Users reporting users is a terrible way to manage account misuse/bad behaviour. Your average user on your average platform is a low form of life incase you hadn’t noticed.
Worse is if your competitors report you and get you banned while having profitable ads, there goes a large marketing channel and likely a chunk of revenue, think shopify stores, restauranteurs. Reddit is full of these stories
It depends a lot on how you train and incentivize them. Most big-corp social media seems to not care very much about false positives, but it doesn't have to be like that.