I think it largely depends on the situation and personal judgment. It is not a good idea to always wait until a scam happens to warn the community. If there are obvious red flags and valid reasons,
You personal judgment (when wrong) should not damage others reputation.
This point has given me food for thought recently and I think it is the subject of a thread on its own.
I agree with Stalker22, I prefer to red tag someone when I have clear suspicions even if I don't have hard evidence rather than wait for the scam to happen and red tag then.
I did so in two recent cases: Royse777 and Shaker_finance.
In the case of Royse777 I red tagged her and supported the flag when many people didn't want to due to previous reputation. I was seeing that Bitlucy could be a clear exit scam and she was involved. Something had to be done to try to put pressure on her to fix the problem. When the scam had already passed, it was when many in DT supported the flag and red tag her. The red tag should be used if you think that trading with that person is high risk, and here there is a component of subjectivity, which should be minimal.
In any case, if I'm wrong, I can change the red tag and nowadays it doesn't hurt anyone to have a red tag for two or three days until things become clearer.
If negative feedback is only used to tag someone when they have already scammed, then it is useless.