I think Scaff has made the position quite clear, but I'd like to add something to the discussion. Enforcing the rules (such as they are) on the use of profanity (and issues regarding the swear filter) is a job that should be at the discretion of the moderating staff - for the benefit of everybody. In my view, the alternatives (i.e. no restrictions at all, or automatic penalties) are far less desirable.
A strict, black and white rule and/or automatic infractions for tripping the swear filter would be unfair, therefore there really isn't much other way of dealing with the situation fairly than to deal with situations as and when they arise - usually on a case by case basis. I think everyone would agree that, with a modicum of common sense, it is quite easy to know where to draw the line. If for some reason a member over-steps that line (either wityingly or unwittingly), it is the duty of a moderator to bring that to the member's attention. How the member then deals with the situation is entirely up to them.
Another point that should possibly be mentioned is that of how moderators deal with individual cases where there may be a point of dispute. Often, it doesn't help either party if more than one moderator is used to convey the message - hence why some issues begin to have the appearance of a 'personal' issue. All I can say is, that in the vast majority of cases where there may be a reason for dispute, mods do seek advice from each other and opinions on more contentious issues before then relaying the message back to the individual member. I think that it is a good thing for moderators to take the responsibility of dealing with situations and seeing them through, rather than opening up more channels of communication and potentially complicating a straightforward issue...
