I sit here, and I watch people argue about things that are pointless, and then I think how boring your life has to be.
Anyway, on topic, I somewhat agree with this. Should it be automatic? No, it shouldn't. Why? Some members earn a legit vouch rep from members who get banned doing something that doesn't even involve them, and now you're asking to take away rep they've earned? It doesn't matter if the member was banned or not, if they earned that rep, they should keep that rep.
It's like someone coming into a store you own, and paying for some type of service. You complete the service, and this guy goes and spreads around the word that you do what you do extremely well. Then, that guy goes to jail. Should your store suffer a blow to its reputation because this guy messed up doing something not pertaining to you?
I believe you have something here, but it's not 100%. It'd cause a lot of trouble and honestly, it'd probably screw a lot more members than it'd help, so I'm voting no.
By the way, it's ignorant to think that just because someone doesn't agree with this, they're a rep whore, so maybe change what your options up there say.