There are consequences. The person will get bashed and flamed if they don't comply. Ta da!
And it also ruins your reputation in the design community. Like say a well-known subdomain hoster, or "family", wants to host someone. It's a chance to get your name out there so when individual people see it, they can hire you. Not as a full-time job -- just $50, one layout, go. Some other person has jocked from numerous people and thus has a pretty impressive spectrum of design. They get hosted. But that's not fair; it wasn't theirs. That was the other person's spot, the person that really designed it.
Just because you can do something and there's no LEGAL repercussions doesn't mean you should. I could go have sex with someone else's boyfriend; there's nothing legally wrong about it, right? But should I? And people should just accept it cause if a person is living, they're there for the taking (and having sex with)? I don't think so.
