How do I report someone who uses local classifieds to offer services on modding a system? Do I report him to the local authorities? (ie: the police)
Since he/she is posting in the local paper I would have to say unless they are breaking the law then there is not much you can do. You could try contacting the local paper and ask them to take it down but they don't have to unless some law is being violated. If the seller is listing his/her GT then I would say file a complaint on it via the console (send it a FR and then file then remove request).
Check out the NEW XBL Account Security FAQ
But they are in direct violation of their xbox live user agreement. And are in fact promoting the continued violation and misuse of his and the countless number of people who would use his services. Now this isn't the first time I've seen this. I think that microsoft should take some form of action against these people. Otherwise, their job is going to be extensively harder, and is in fact flooding their network with more and more illegally modded systems.
They do, it's called the banhammer.
Ryder Cup: 10-6 up and you blew it? hahahahahahahahahahahahahaha. Oh wait you serious? Let me laugh even harder BWAHAHAHAHAHAHAHAHAHAHA!
where can i find more info on this "banhammer"?
Nevermind. Good ol Microsoft! You never let me down! Sometimes the best action is no action at all.
Account banhammer - http://forums.xbox.com/xbox_forums/xbox_support/f/41.aspx Console banhammer - http://forums.xbox.com/xbox_forums/xbox_support/f/2366.aspx