Part of the purpose for evaluation is to provide feedback. I'm not going to claim that the form of feedback is great, but it does offer motivation to improve.

The other thing that feedback feeds into is credentials. I realize that some people are dismissive of this aspect of the degree, but it is important to pursue further studies or secure a job. While you can argue that these people are only cheating themselves, and some of them are cheating themselves, a great many will continue to cheat as they advance in academia or the workforce. In other words, they are cheating others out of opportunities.