Reuters - A $250 IMSI Catcher, cell tower simulator that can be made and deployed by just about anyone.
While not discussed in this 3 minute news story, you don't have to be making a call for your phone to connect to a simulated cell phone tower; it will try to connect to the strongest tower it can find automatically.
Once your device is connected to a simulated cellphone tower the attacker has complete access to your phone, they can activate the microphone even when your not on the phone, use the camera and can even install spyware onto your device for use at a later time. Hardware level vulnerabilities limit the effectiveness of software level security, so you need to take steps to protect yourself.
The threat is very real and the technology is available to anyone for as little as $250.
I certainly encourage you to look around the blog to get an idea of just how vulnerable your cell phone actually is.