I'm pretty sure this was already the case in some games before, depending on the netcode of the game.

The old FAQ said:

What if a borrower is caught cheating or committing fraud while playing my shared games? Your Family Sharing privileges may be revoked and your account may also be VAC banned if a borrower cheats or commits fraud. In addition, not all VAC protected games are shareable. We recommend you only authorize familiar Steam Accounts and familiar computers you know to be secure. And as always, never give your password to anyone.

If it's a game with VAC it probably always worked as described above, but for example: People in Fall Guys did use this trick to avoid getting banned for cheating until they turned off Family Share for Fall Guys shortly after release.