I've been following artists beware for a while and the artist accused of this, Mechasheep, seems to be getting an increasingly negative reputation. But back to the issue.. I've been suspecting tracing for a while and my suspicions were confirmed a few weeks ago when a certain drawing was submitted for approval. Mecha posted the stock image she had been using as a ref and it turned out that she directly traced it. Now I wouldn't have reported this here if she was drawing just for fun, but she is and has been paid for this drawing.
Before it was approved and she was paid I had shown the main admin of the site this image as proof - http://i56.tinypic.com/2vaz0j8.png
I wasn't expecting to be completely blown off though.
I know bias and favouritism exists among the staff, but with things like this it's just not an excuse. The admin I reported it to is in control of art section of the site and she said there was nothing wrong with tracing as long as it's not /exactly/ the same as the reference. After I was told this I simply dropped it.
A little while later though some of the other staff discovered the tracing, and went back through some other things that Mecha has drawn and discovered that this isn't the first time she's done this. One of them confronted her and she denied it completely, saying she heavily referenced at best. After talking about all this between ourselves it was decided that this should be reported to the site owner.
Now I don't know if this has been done yet but I'm unsure if I should do anything more.
Nobody has looked into her off-site art yet but I wouldn't be surprised if you found references she forgot to mention. I'm aware that she takes commissions for $ on her furaffinity account and that she has complaints about pushing back older commissions again and again. Then also that she only draws them once she feels like she has enough inspiration for them, yet she can draw for this website 24/7. So really, this is just a warning of what she does before you look into hiring or getting some art from her.
EDIT - More examples of tracing:
http://i.imgur.com/SMhD1.png (Same as above, just a comparison)