Microsoft has backtracked on its original threat to ban the LIVE accounts of gamers who have purchased Halo 3 early following high street retailer Argos' admin error.

Earlier today, a Microsoft rep told Pro-G that gamers who played Halo 3 early would have their LIVE accounts banned. The rep also confirmed that Microsoft was able to ban accounts based on information collected by the console which showed when the game was played.

However, Pro-G has since been contacted by another MS rep, who said the ban only applies to Microsoft employees.

What this means for those of you lucky enough to have taken advantage of the Argos error is that you can start playing the game, if you already weren't, free from retribution.

Update: A full statement from Microsoft on the Halo 3 banning scandal can be found here.