if you have, say, better than 90% accuracy in reporting spam or rules violations then you will receive a merit for each new report submitted (as long as it is accurate, of course).
Merit farmers will create a few thousand sockpuppet accounts, create multiple spam with each sockpuppet account, and then use their main account to report all their own sockpuppet spam. Voila, instant 1000 merit.
Well of course NOW they will do this if it's implemented.
I said myself that this may or may not be a good idea.