McNeo, I believe that's how it works now and I don't like it this way. Permanent changes don't encourage RP in my eyes. Instead they could even lead to the OORP process of creating a new character..
A draconian punishment like this should only be used in rare circumstances and require the rp described with FR5.
It should be easier to set up (non permanent) rep changes to give an more immediate inrp sanction to a player that offended a faction.
The usual inrp faction reporting facilities should be sufficient to have a valid reason to FR5 someone. For example: If the RFP considers a report of an officer valid to add the offender to the criminal database, it should also be enough for a non permanent FR5.
