great extension by the way, although I do have an issue, I think the issue was also mentioned a few posts above mine.
I have successfully created a group called "Banned Users" and when I issue the infraction to my test account, the test account is indeed put into the banned users group with read only to select forum access. However, the permissions are not enforced because the test account stays in the registered users group with normal forum permissions and access. So in actual fact, my test account is now in both the registered users and banned users, therefore not having the permissions enforced from the banned users group.
My suggestion would be that when you put a user into a pre-defined group for an infraction, there should be an option to allow the administrator when issuing an infraction to remove the user from all existing groups that they are already in and only be placed in the infractions group, and in the case of infractions that expire, an option or value should exist so that the user is then automatically placed back into there original group prior to being issued the infraction.
I hope this helps, if you need any more info, please feel free to ask.