"VAC uses a delay banning system. What this means is, a cheater gets flagged by VAC and then gets banned in the future. So it is very possible you can see someone cheating on a server. This is done so a cheater doesn't not know what cheat got them banned ... creating confusion.
You can be assured that the player has most likely (if not then soon to be) banned by VAC. The system just hasn't instituted its latest ban list." -
OcarD - Valve Administration