It is really disappointing to have people like that on Steemit but no matter where you go, things can unfortunately happen. It sucks to know you can get flagged for doing the right thing. Its very discouraging but that's just what it is. Steemit is still a great community. I hope you get your reputation back up soon and malicious flagging doesn't happen again.
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The good thing is that the community is large enough that the reputation system actually works. Its comforting to know that though these people may cause some damage, they eventually weed themselves out by being negative.