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There has always been a button in Battlefield 3 to report cheaters. The problem is, of course, that the Battlelog "report" button never actually did anything, which made it a pretty terrible way of stopping the problem.
The new function lets Battlefield 3 gamers report cheaters and stat padders, submit links to Battle reports, and select players suspected of cheating. There's still a human element - someone from the DICE anti-cheat team will still sit down and check out the reported individuals, so the system (theoretically) cannot be abused.
Jimmy the Geek