There are forms of cloaking that some would consider acceptable practices and then there are some forms of cloaking that everyone would consider unacceptable. One such case of cloaking was presented by Phil Craven over at the Search Engine Watch Forums under the thread title Obnoxious cloaking scam. In that thread, Phil discusses a case where he found a client being taken advantage of by his hosting company. Basically, the hosting company was basically serving up a cloaked page to the search engine bots on arrival. In these cloaked pages were added text links to benefit the hosting company, without the consent of the client. In addition, new subdirectories are added to the unsuspecting client's site.
GoogleGuy saw the thread, as PhilC and others wanted to and offered to help. Its important for this type of scam to get out there in the public, so please tell people about this thread and type of cloaking.