Ban reason and the moderator name were public on Something Awful, which allowed the community to respond (actively or passively), and for more senior moderators/admin to take public action against rogue moderators. The transparent audit trail countered the incentive to ban somewhat, but a lot of people also treating getting banned as a game.
It's because you can't reasonably put everything in the rules. They would be thousands of words and still have holes and special carve-outs, _and_ users will still argue about rules application if you say your rules cover everything.
It's more reasonable to have "a spirit of the law", so to speak.
Lemmy isn't simply Lemmy since it's federated. A screenshot like this is somewhat meaningless without specifying on which instance this happened. There are instances with very lax or even no moderation at all.