Well, I think the government and various criminal organizations have figured out how to circumvent the GSM encoding on most cell phone for awhile now, but somebody else figured it out and released a fair amount of info to the general public, including source code.
This means phone calls on GSM based cell phones can be intercepted, decrypted, and listened to. The documents released are pretty technical and I don’t think just anybody can implement it.
There are laws in the US against the manufacture or distribution of equipment dealing with cell phone hacking, but sooner or later something will be available that makes this operation technically feasible for anybody with the interest and minimal education.
This material was discussed at a conference and here are the slides for those interested:
http://events.ccc.de/congress/2009/Fahrplan/attachments/1479_26C3.Karsten.Nohl.GSM.pdf
The project website:
http://reflextor.com/trac/a51
Article:
http://www.pcworld.com/businesscenter/article/185552.gsm_encryption_cracked_showing_its_age.html