The only authority is your individual conscience. This is your community.
Are we wikipedians citizens or policemen? Are sysops policemen? If I suspect that another user is breaking the law, should I report that to you or should I take action against the abuser? Speaking for myself, I have no interest whatsoever to play the role of a police.
Maybe wikipedians are both, maybe wikipedians are neither. I suspect that the analogy is a bit too stretched for us to communicate well using it.
What I'd say is that if you see someone violating copyrights, and you feel like doing something about it, then do so, and I will support you. If you don't feel like doing something about it, then don't, and I'll support that, too. It's your right to let it go on.
My wish and hope, though, is that we all do a little bit of the "dirty work". It's hard to tell an eager newcomer not to upload copyrighted materials. It's hard to do it in a way that's nice. So anyone who doesn't feel up to it, can feel free to do something else instead.
When I was new to Wikipedia, I remember it was very hard to understand who was in charge, giving orders, and who was just giving their personal opinion. If somebody tells me I "shouldn't" do this or that, I like to know the authority of that statement.
Sure. The interesting thing about Wikipedia, though, is that there's very little "in charge" and there's very little "giving orders". No one has much power over others.
HOWEVER, having said that, we are here together with an agreed upon vision: to write an encyclopedia for the widest possible distribution. This vision gives us a shared context, and some "rules" follow directly from that.
--Jimbo