Based on information found at various places on the Internet, this error appears to be a fraud protection measure.
First check to make sure all of the contact information you provided to
Microsoft is correct. You can do that at the following URL:
https://live.xbox.com/accounts/ContactIn…
It is likely that even after you verify your information, you will
still have to call Xbox Support again before your account's purchasing
functions can be reactivated. If you did fill out one of your contact
information fields incorrectly, fix it and try explaining your
situation to an Xbox Support agent.
So if your system is still under warranty and you meet the requirements above then you can send your unit to Microsoft since they do not charge you for the repair.
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