Alan "Brenlo" Crosby, EQII Senior Producer, posted on the official forums addressing the recent Battlegrounds transmuting bug and actions taken against players who exploited it.

This weekend an exploit was found on the Battlegrounds server which allowed players to transmute items, and have those items returned when leaving the Battlegrounds.  This occured due to a change we made in the code to speed up the return process.  While we understand that this was a bug of our creation, some players chose to take advantage of it, knowing it was not meant to work in that fashion.

Many players took advantage of the bug, to varying degrees.  Some of our community however went to great lengths to abuse the bug.  For those accounts that abused this obvious bug, we have taken action.  Some have been removed from the game altogether, while others are losing all of the items on their characters.  All will face at least some time removed from the game as we sort through the various logs and track down their ill-gained platinum and items.

While we hate to remove anyone from our community, our family, there are times that for the good of the servers, the in-game economy and the community we do find ourselves forced to take action.  Unfortunately, this was one such occasion.