Obviously nobody wants reported posts by User X to be seen by all the other users because reporting is a confidential thing. So this forum has the user permissions set to 'only thread starter can see the thread and reply to it'
Staff can see all threads and all replies in that forum. It helps to deal with reports quickly and fairly. I had this set up on my old VB forum as well.
One problem I've got is that no-one gets any alerts from that forum. There is no alert to the thread starter (the reporter), there is no alert to any of the staff that reply in that thread either. This is the only forum it happens in so I'm guessing it has something to do with the permission that only the thread starter can see his/her own thread.
Am I missing something here?