I've dealt with the exact same thing. Unreal isn't it when you call them on their activities, they try to turn the tables on you like you are doing something wrong?
Forget probation, ban the bums. Who wants people of that character as part of your site?
I tried to look at my situation positively. These type of copycat sites started by the disgruntled or unethical members, will attract similar people, thus getting them out of your hair.
Besides what has been suggested, you might also want to censor the URL so it can't be displayed in PMs. No mater how hard you try to keep them off your site, they may come back on under new accounts and resume their PM campaign.
Stick to your guns because you are in the right.
Finally, don't post what is going on your open board. It just gives them satisfaction that you acknowledged them.
