Go into the ACP >> Users and Groups tab >> Click Manage Groups on the left
On the top is "User defined Groups", there is likely a moderator group there that got converted to User defined Group. Delete it.
The predefined Groups on the bottom are created by phpBB and should include:
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Newly registered users
Add your moderator to the Global Moderator Group if they are not already added. While you are there you should make sure you are part of the administrators Group.
Next you should check permissions, ACP >> Permissions tab
Under the Global Permissions make sure they are set correctly, these are for basic permission outside of forums like can or cannot use PM's. Check them for Administrators, Global moderators and go through each group under Groups permissions.
Next check the Forum permissions, go to ACP >> Permissions tab >> forum permission. Where it says select a forum check the "all forums" box and hit submit. On the next page on the left hand side typically there should be no users listed. On the right side if you have any groups listed in the lower
"Add groups" that means that group has no assigned forums. Typically this not normal. If it is "user defined Group" you probably don't need it and can go back to the manage Groups tab and delete it. If it is phpBB created group leave it.
Above that under "Manage groups" highlight the first group, go the the last group listed and select it by hitting shift and then click. All groups in that pane should now be highlighted. Click edit permissions. On the following page it will list all forums and the permissions assigned to each group. Adjust as necessary.