I think it's already a rule

Sadly not

Should be illegal if the victim doesnt like it

The rule only stands that we aren't allowed to impersonate any staff member: "Do not impersonate staff, in chat or elsewhere.". However, due to the last day incidents, I do believe that such rule should be amplified to any member of the CC Net Community, unless such allows it. This would removed any advantages granted to the "copy-cat" against misinformed players in situation such as Sieges.

smh ccnet becoming pay to win

I can respect that in the past this was done as a joke, with it not being used maliciously a majority of the time. But in the context of sieges it can just be annoying.

Sure there is a visible difference (in rank + colour) and there is a spelling difference, but some players dont pay attention in the heat of the moment.

Tecnically one could say that such rule is underlying in the rule 6 of General Rules as using the command /nick for Trapping and Luring is surely something that can be considered an "unintended game mechanic".
Nevertheless, having it specified would be a greater favour for everyone.

agreed i died to this and it was not ok

Yeah this needs to be a rule, people using the nick command in general is really annoying. Just stick to one name. There should be a cooldown or something, or maybe the players should have to ask an admin to have their name changed. Or maybe a money requirement for a name change?