First off, thank you all for your replies.
Ceroria | XyZebrAbC, you make some really great points and while I agree that there are some mods online and helping on Teamspeak, I've seen a large portion in [DND] rooms. (No, I don't poke them. I just let the hacker go and mind my own business.) Yes, as of now the forum reports can get handled, but if a reward system were to be put in place I was worried about the influx of reports. I was not trying to reprimand the current staff team, as they do an amazing job at getting to reports.
Accounts getting hacked is actually quite rare. Yes, if their password is 'password123' or something along those lines, they did it to themselves. And if their account was hacked, they are never getting it back. I've read threads about it and the hacker will change security questions & often gets a hold of the victims email as well. (Therefore no password reset!) There are also websites where you can buy/rent hundreds of accounts for only a couple dollars, meaning there are so many hacked accounts in circulation (presumably from the large Mojang/Amazon Web Services SSL breach earlier in the year) that the gain from having a one-strike system would far outweigh the consequences for the few that do get their accounts hacked.