I recently saw a thread that went something like, "I traded for this pet, and I reported it just to be sure, and now it's gone and frozen-- i've been watching it and the owner hasn't gotten it unfrozen??? it's been months???"
I'm thinking, yeah, that's what happens! You report UCs and they get frozen onto their original account... who is an inactive player... and does not care to get them back... and probably did not care to begin with. Goodbye, UC.
There's no "justice" in reporting "stolen" UCs. It's like junking; you can't "steal" something that nobody wanted anyway. By reporting the UC, all you're doing is removing them from existence.
The previous owner didn't care, the new owner is now pet-less, another UC bites the dust, and you've accomplished nothing aside from making it harder for YOU to trade. It's a lose-lose-lose-lose.
If the "real" owner doesn't come after your UC themselves (and they rarely ever do), chances are they're too busy dropping their daughter off at school or something, and have not thought about Neopets in years.
Let it be, the UC is now owned by someone who actually wants it (or will be traded to someone who does).
It's definitely getting out of hand, unfortunately.