Cheaters and hackers beware, a console ban is a permanent ban. If you try and sign into LIVE and get “This console has been banned for violations of the Terms of Use. To protect the Xbox LIVE service and its members, Microsoft does not provide details about console bans. There is no recourse for Terms of Use violations.” your console is done for.  Buyer beware as a console that has been tampered with an sold or given away is still going to be banned.  Your warranty is void and you will not be able to have your console serviced.

I have not committed any fraud, I’ve never had action taken against me by the enforcement team, and I know for a fact I have not modified my console.  Can you undo my suspension?

The investigations and subsequent actions taken by the Xbox LIVE enforcement team are conservative in nature.  We work very hard to try to fully understand that a console has been modified by looking at a variety of information.  Sometimes it’s possible that a previous owner or another user may have performed unauthorized modifications to the console.  It is also possible that the purchaser of a used Xbox 360 was not aware the console was modified.  In either case we cannot undo the console suspension.  We recommend customers who believe they have not modified their Xbox themselves (or committed other actions on the service to warrant suspension) to contact previous owners or users of the console.

Check out the rest of the story at Xbox LIVE Policies on Console Suspensions