Nibog,
You are obvously talking about Class B airspace (where VFR flights are separated from VFR flights).
In anything less, VFRs are not separated from VFRs and in D or E controlled airspace, VFRs are not separated from IFRs. Thus assuming that the aerobatic flight is VFR

I take it that you would only ask a pilot to turn off verified mode C during aerobatics in class B airspace.
Do you work in Belgium?
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Scott,
The problem in the UK is that incorrect mode C readouts are not reported and if they are the reports are not followed up unless an incident or accident occurs.
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Very ironic that I have to be told that the permit to fly aircraft converging on me at the same level has an unverified mode C...............Heck, the altimeter the pilot is looking at was probably picked up on a stall at some car boot sale and is not required by the airworthiness requirements to be calibrated! Seems to me that the mode C may be the only true indication of level!
Regards,
DFC