That "aliens" picture doesnt really hit the tip... it is indeed possible they have a small team of GMs roaming around for people doing suspicous stuff. If you happen to appear right in their face, well, that will not have a happy end.
But still nobody knows for sure, and that is what itches me a lot. Not calling anyone here a liar, but since we do not exactly know each one´s behaviour regarding the use of Midnight, we will never get evidence about the possible flagging and banning source.
Me, for example. I only used click to teleport as well as careful self-written coordinate lists for daily node farming (Ori, Omnom only) on 7 characters for almost 5 weeks until May 27th, then went on vacation for a week and came back yesterday. No ban for me until now, but all the posts about people being banned made me puzzled. Name-ESP is always-on for obvious reasons... since i do not teleport right to the nodes but anywhere beneath, its necessary and healthy for the account to look around for other players / waiting for all NPCs and PCs to load before teleporting to the node.
TL;DR: All the discussion about bans and their possible reasoning is pointless because - as you see - we have lots of different conspiracy theories for it, everyone uses Midnight differently. No known circumstances etc, etc... all i wish for is if people write about their ban they shall provide all information they can give. maybe we will notice pattern or something like that.
Fact is, its not up to buFFy! to do something with Midnight, its totally up to us to use it well-thought.