you know what Bungie I think the best way to fix cheating and not lose players. Is by instead of baning them, 1 send the cheaters to another server filled with cheaters. 2 give a title that is permanent, Example a title called cheater where they can't remove or replace the title with other titles they own. 3 give them an aura called cheater.
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I would make their toons unable to run in any activity. Bit like a ball n chain and no sparrows. I'm sure they would get sick of walking everywhere