If you see someone in your ward doing something they shouldn't you would tell the bishop and ask how to proceed would you not. That;s how it should be, you tell the HCO if something is wrong, and HE decides how to handle it, i would bet there have been plenty of cases, where this has happened and the HCO didn't just boot them out right away but rather encouraged the "snitcher" to help the honor code breaker out and watch to see if he keeps making mistakes. If you see a problem anywhere where there are rules your duty is to report it, then they manager or whatever can decide how to proceed.