This is not a post adding to the complaints about cheaters. These things exist and the best thing we can do is identify cheaters accurately. I am an experienced modder and I was able to learn the basics of how these hacks work with just a little forum reading. Use these guidelines to be certain someone is actually cheating and not just a skilled PC player with high end peripherals.
Aimbot (cannot name hacks specifically, you'll know it when you see it):
On the basic level this cheat allows perfect auto-aim, but it's not much better than a skilled PC player, so hard to identify like that. It also shows boxes around players, chests, enemies and fort keys that are visible through objects. This is the way to spot people using it. If they forget to turn off local chat, you may hear them describing player or chest locations when they are at a distance or out of sight. You may also see them looking through an island when players are on the other side. If you know your teammate is behind an object from the player and they still appear to be tracking them, they are probably cheating. Most players using the aimbot also use the Eye of Reach without scoping. If a player instantly ratchets around 180 degrees or so and headshots you at an odd angle without using the scope, it's probably the aimbot. Skilled players are not so Terminator precise when doing the same thing, though they can do it.
Flagged as Friendly
This one is much less common, but you will see it. I didn't look up the fine details, but like many other games, it is possible to flag yourself as friendly to other players with a hack. There are two ways that players use this to their advantage. One is to be invincible to everything but your cannon balls and exploding Gunpowder Barrels. The other is to team up with other cheaters, without worrying about friendly fire. This one is harder to spot, because players using lag to their advantage can also avoid damage without hacking. If a player is hit directly with a sword thrust and a shot to the head, but doesn't seem at all bothered, they may be cheating. There is only one way to be absolutely certain, so be very careful not to report players who are just luckier than you. If a player is using this hack and has flagged as friendly to your crew, if you sink their ship, they will respawn near yours instead of at their new boat. If you are absolutely certain you sunk them and killed them after the boat was all the way down and they still respawn nearby, they are cheating. This appears to only work for a limited time. They will eventually be forcibly respawned at a new boat, even if they don't die.
That's my report so far. I thought instead of cheaters just being bogeymen, we should get scientific. Please add anything you learn.