Without specifying how falsely banned Xbox Live members can get reinstated (customer service presumably can take care of it), Xbox Live evangelist Larry Hyrb announced on his blog: "In our continued effort to keep gameplay safe and secure for our community of more than 14 million members, Microsoft has taken action against a small percentage of Xbox 360 consoles that have been illegally modified in order to play pirated games. You should know that modifying your Xbox 360 console is also a violation of the Xbox LIVE terms of use, will void your warranty and result in a ban from Xbox LIVE."
This isn't the first time owners of advance games have been banned from Xbox Live. In 2007, privileged gamers with early access to Halo 3 cried foul after having their Xbox Live accounts accidentally banned as Microsoft took measures to stop dirty-rotten pirates.