How is poor sportsmanship handled in League of Legends?

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The FAQ pages on Riot Games' site is somewhat lacking in information - how exactly does one get punished for poor behavior in the game, what's against the rules, and what are the consequences? Could someone summarize it for me?
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Does reporting work in League of Legends?
Reports are significant on a per-game basis because no one is punished on game data alone. So if there are no reports in a given game, the system assumes no one had a bad time, and there's no reason to consider punishing a player.What happens when you get reported in league?
When a player is reported, their case is first reviewed by our automated Disciplinary System. This intelligent system analyzes the match data, reads the in-game chat log, and weighs the offending player's report history* before measuring out the appropriate disciplinary action.5 Times Players Were FINED For Strange Reasons - League of Legends
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