The one time it happened, referenced above, the moderator was removed from her post over one matter. She was later banned over an unrelated matter. This was long, long before there was any formalized procedure of mod notes, warnings, suspensions, or the like.
If a moderator committed a severe enough offense, they could potentially be banned immediately just like any other poster. For lesser offenses, it would be likely that they would simply be asked to step down as a moderator long before they were candidates for banning.