Companies are gaming verified purchases now. There are several sites that provide a service of connecting reviewers with companies who provide their products for a hefty discount with the expectation of getting a perfect review.
Companies are allowed to vet your previous reviews to determine how likely you are to give a good review before giving you a discount code. If reviewers don't deliver, they stop getting discounted products, or even get banned from these sites.
Banning products: Companies could knock out competing products by starting a "false flag" review campaign that Amazon eventually discovers.
Banning reviews: It can be legitimate to provide samples of products for people to review and helps encourage competition, it's more about the method of the approach.
The best approach is if Amazon just facilitated the whole approach to ensure integrity. I think they attempted this with their Vine program, but that might be too one-size-fits-all for some companies.
Banning products is not something you would do every day. It's the kind of thing you do randomly in large swaths so "false flag" operations are likely to hurt you as help and are not free.
Banning reviews: No it's not legitimate. Customer reviews are useful specifically because they are by people that thought the service might be worth while. If you can't afford a 911 or don't like the way it looks then your opinion is not meaningful.
From amazon's perspective review integrity is expensive but so is giving up. As a customer it feels like they gave up a while ago which opens them up to competitors.
EX: Newegg is where you buy video cards not Amazon.
Companies are allowed to vet your previous reviews to determine how likely you are to give a good review before giving you a discount code. If reviewers don't deliver, they stop getting discounted products, or even get banned from these sites.