Do you know him?
If so tell his parents, lie and say the code cost you $40-$50 so they will actually care. I did this to my friends friend who came round to my place once when he took my MS-Point code card. His dad threw the X-Box out the second story window XD, the look on his face when I appeared at his door and his mom asked him "Did you steal this boys code?" was fucking priceless!
If you don't, report him to X-Box live with proof that you have and bought the code, at the best he will be banned for a long time/forever, at the least you should get given a new code or compensated.