Free flags are like free ammo, you can't really expect something good from it.

How do you want to prevent single users like @haejin and many others to extract hundreds of dollars (per person) every day?
I don't consider this, plagiarism and spam as minor problems.
It's so discouraging for newbies to observe these kinds of behaviour. Some told me that they don't like to take part in a community where pure greed gets rewarded ...
I think there has to be any solution, and if no flags then anything else.
Of course I respect your different point of view but cannot agree here.

It's impossible and no entity will have enough resources or manpower to constantly scan the whole chain to detected abuse.

Algorithms will do. They seek and preselect suspicious activities, so that humans only have to check whether these cases suggested by software are worth to investigate further or not. In addition users can always report abuse manually.
Anyway, there is still a long way to go until mass adoption, and I think it's worth solving problems now which in the worst case could prevent to reach mass adoption at all ...