That does suck...
I was 'hacked' about 6 months ago too. Just playing some L4D2 then I got that very same 'Another device is signed in on this account, you will now be signed out' or whatever it is; been a while. Fortunately I had my laptop right next to me, so promptly signed in on xbox.com, signed in, changed password then all security questions, associated email address etc.
They had time to buy 5000 MSP, but slow enough that I changed the password and everything before they did.
So I ended up with someone buying 5000 MSP with my money, but I didn't lose the account and kept the points, could have been a lot worse.
No idea how it happened, my pass was 10 chars long with numbers, upper and lowercase, and special characters. And no, I didn't sign up to any 'WE'LL GIVE YOU FREE MSP, GIVE US YOUR LOG-IN DETAILS' or anything stupid. Also use a different password for everything.
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