Yesterday it became clear that scammers had found an exploit that enables them to re-use redeem codes on Xbox Live. Today, Microsoft is apparently "aware of the situation and have taken steps to invalidate the codes obtained illegitimately". It is also querying the $1.2 million loss of revenue being reported.
In terms of the figure of $1.2m, Microsoft told Gamasutra that amount is "inaccurate". It then stated that, "We canít share specific numbers, but the figure is nowhere near the amount that has been reported."