So, the GMs keep saying to report wrongdoings or else you get punished as well (for failure to report). What I'm wondering is, how is it determined that someone knew something was going on and deserves punishment for failure to say anything? Is it like...being a bystander and hearing about/seeing it? Or do you actually have to be involved in the act some way?

Not that I wouldn't report things if I actually saw it happen. This has just been confusing me for awhile and I'd like some clarification on it.
I don't use @main. Do not ask for me there
~Characters~
"Lady" Linnea: 99/69 Spirit
Champion
Aslinn: 9x/6x High Wizard
Jocelinn: Low-level dagger stalker
Lemon Poring: 9x/50 Brewer
Alchemist