What Punkbuster does is scan your computer’s memory for any known cheats or hacks. What cheaters do is run outside programs that affect the game in ways that work to their advantage, like automatic aiming, invincibility, and so on. If Punkbuster catches you running one of these programs, you will be kicked out of the game. Furthermore, the owner of the server could choose to ban you from that server, which happens quite often.
Why is Punkbuster so necessary? Imagine: if you just spent fifty bucks on a brand new game, then go online to play only to see your character be killed or so limited that you can’t even play the game. What fun is that? Cheaters and hackers can completely ruin a game and it can be incredibly frustrating when you have to deal with one. I actually quit playing a game called Battlefield: Modern Combat on the Xbox because so many people were glitching, which is where you find flaws in the code that lets you hide inside of buildings where nobody can see you.