To those saying "[i]The kid wasn't hacked.. he willingly gave that guy Kirmit access to his console. That's not hacking.[/i]"
You obviously have no idea what hacking really is and clearly have never heard of social engineering which is in fact a form of hacking. Ever hear of a guy named Kevin Mitnick? Social Engineering was one of the primary tools he used to convince people to give him their credentials which he later used to illegally gain access to private computers and networks and Kevin was arrested and served time in prison.
Kevin didn't steal any passwords or usernames. He merely convinced people by deceiving into thinking he was an employee of the same company they worked for. This is essentially the same tactic this guy KirmitTHEfrog used to gain access to not just that one kids console but also another players console a few months prior.
So yes, that Kirmit guy DID in fact hack into the kids console which I am sure is in violation of Sony's terms of service for PSN.
Social Engineering Definition:
http://en.m.wikipedia.org/wiki/Social_engineering_(security)
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