I don't think it's fair for users to be fooled by someone who is a "verified vendor" or whatever title they get, then say "ah well damn don't you guys do research?"... With this mindset your potentially saying that buying from vendors on this site is a land mine field, some paths will be safe and others might blow up in my face so it's the consumers responsibility to somehow navigate a camouflaged field of explosives with mis-information and mis-leading "vendor" status titles.
I'd like to start out by saying I don't think he even has any products that he advertises here.
Second, there is an angle of truth to what you say, there is no distinction between say a 'Gold Sponsor" or any other vendor who sells here commercially. I classify everyone that way simply because I have not made any other category of vendor, this site is still small and growing and frankly, I've been wacking other moles. Making this change takes me all of two seconds to do, once I've sat down and determined what kind of model I want to follow, but since I've not even worked out how or when people will become a "Verified Vendor" as you put it, nor what benefits such a status would entail, it has not been done. Yet.
I've written several guides for our document section, I don't always tell the readers to wear safety glasses either much like I expect them to be intelligent with their spending. So while I know related issues can be addressed in time, for now I'm satisfied with my method of handling things considering I've just eliminated the only instance of this problem I've been made aware, and people will simply have to brave the world of financial decisions using their brain for the time being.
I do like your idea of a "Verified Vendor" and will likely implement such feature. Additionally, the demotion of the 'visual designation' for a non paying vendor to a color besides a green banner which is generally reserved for an elevated member group. And in those cases where someone becomes a verified vendor, I certainly could request someone to provide something like a photocopy of their drivers license, or perhaps articles of organization, etc. That isn't an issue and that part is something I've already considered.
As to your original post as I've seemed to have missed it:
Letting someone like this advertise on your platform, and actively assisting them in creating an appearance of legitimacy is even worse than being a consumer who was fooled by said tactics.
Scammers cannot be eliminated entirely, otherwise they wouldn't exist anywhere. There can be safety measures in place to try and mitigate this, but if you'll allow me to exaggerate for emphasis, small business don't start out with a team of private investigators and the secret service for security guards either. Actively assisting someone and allowing them to exist temporarily until caught are two very different things when viewed through the lens of intention. The underpinning points of concern you have are valid, but your application of it here, in this situation, I am struggling to acknowledge as anything more than hypothetical and slightly embellished. Could you please show me a thread Jerry has posted here advertising one of his products? I could be wrong, but I do not think he has started any and this may be the answer to your question as to why this was not already resolved, because it hasn't been an issue which has stemmed from this forum. I've even asked people if they had heard about him from here, and they said they found the complaints here and had already purchased. My day consists of choosing which fire to put out in most cases.
Have you taken a look at our Dispute | Octagon section? It is dedicated to issues such as vendor complaints, tuner disputes, controversial topics and such. Having the active intention to assist someone to commit crimes is far from our motive, intention or part of our daily routine.
As I've said before, not all our policies are perfect, everything is open for an intelligent discussion but you'd be more successful if you phrased your concerns as requests or suggestions rather than borderline attacks or accusations of hypocrisy. But please, I await a list of threads started by people like Jerry which make this site a land mine field for potential buyers as you boldy put it. I'll find a solution for handling that if I do not have a protocol already.
On a lighter note: What do you call a land minefield with only one mine which was already removed?