Banning people based on submitted user reports? I don't think so.
Anyone who's ever played multi-player has very probably come across someone being called a cheater and found no reason to believe it. Since you're reading Blues, you're probably an experienced enough gamer that you've probably been accused of cheating on a number of occasions.
What can they do to follow up the accusations? Perhaps look at stats but then why bother with reports, just look up stats. Reporting cheating to a server admin is worthwhile because they can spectate the player on the server.
Either these guys are happy with the ban hammer or it's a placebo button to placate people annoyed by suspected cheating.