I know when I spent a lot of time dealing with fraud in a different market, the most effective tool was to catch and shadowban the accounts rather than banning them.

If we banned them, they just created a new account and kept doing the same things.

When we detected them and the isolated them from all other good standing accounts, only allowing them to interact with other shadowbanned users, it virtually solved the problem. Normal users went about their day and the cheaters/fraudsters wasted a lot of time never getting through to anyone.

In gaming it seems like creating a cheaters purgatory where they are stuck competing against other cheaters forever would probably end up being its own special league after a while. Like when people suggested steroids in pro-baseball should be legal.

Yeah, we actually discussed doing something like that.

That's what GTA5 did (though, they marked you with a dunce cap)...

.. even though it's a good idea (and we nearly implemented it actually), there's probably a reason that GTA5 is still plagued with cheaters.