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by Doug Thews.
Original Post: Halo 2 Detects Modded Xboxes?
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Speculation is that there's code inside Halo 2 that looks to see if an Xbox has been modded. If it has, then Halo 2 sends some kind of signal to Xbox Live! with the box's serial number and that user's Live! account ends up getting banned (which is covered in the Xbox & Live! agreements in case you were wondering).
CNet.com posted this article that talks about a surge of Live! account bans reported by Xbox owners of modded systems. While Microsoft hasn't confirmed that there is specific code in Halo 2 to report on modded systems, this is the very reason that I have resisted the urge to participate in the Xbox modding craze. Unless I can use a spare (re: free) Xbox that I can use as a sort of beta system, I surely don't want to mess with my "production" Xbox at the expense of screwing up my Live! account or capabilities. And, like it or not, all of this IS COVERED under the original Xbox and Xbox Live! license agreements.