First, I did not say that the OP had any sort of responsibility to take it upon himself/herself to inform other players about the scammer. He/she does not, but it's quite the feather in the cap of a player who doesn't >have< to do something good for the community but >chooses< to do so. That should not be a controversial point to make.
But that's not what the OP was doing, he called it "defending himself". There's no altruism there, only a bruised ego. He also said everybody else in the chat already knew the offender was full of it. That was the primary concern of your first post: that if the OP put the guy on ignore, other players weren't going to be warned. If it weren't causing the OP such grief that he was compelled to ask for advice about it, you might be right, he could get down in the mud with the guy and hope everybody else can keep track of which one is the good guy. However, it doesn't sound like that's working, so I think doing it just to warn other players is a lousy reason to continue to live with the aggravation that the OP expressed.
On the point above...why have laws against fraud then? I mean, if the best way to repeat being defrauded is to be defrauded once and thereby learn from the mistake, then all such laws are superfluous, would they not be?
Well, experience is indeed the best teacher. Human nature will drive people who've never been burned to touch that stove even when warned that it's hot. So yes, the best way to learn to recognize and avoid fraud is to be a victim of it. That doesn't mean anybody's encouraging fraud as a teaching tool, and it doesn't mean the perpetrator should avoid consequences, it simply means the victim is now better able to avoid it in the future, moreso than someone who's not experienced it. It's a lesson learned.
Secondly, let's not make the mistake of thinking that passing a law against something wipes it out of existence. Laws merely provide a means of punishment and restitution when they're broken, they don't prevent anybody from doing anything until they're locked up for doing it in the first place. That's why there should be laws against fraud,
and even though there are, people will still scam others,
and the victims will be subsequently more vigilant. It's not an either-or situation.
Why Inno has rules in place that are apparently haphazardly enforced, I cannot say. It sounds like they should tighten that up. Until then, the advice given here is sound and I think exhaustive: report him, message his guild leaders and yours, put him on ignore, and move on.