If they could ban the account, they would have done it.

Extension is more like a automated tool. Don't need any permission from Facebook. User can install the tool, and click on a button to unfollow your friends.

Facebook could write TOS for his users not to run a script on their website.

I write scripts (userscripts) all the time. I have a script for Gmail that I use it all the time. Gmail doesn't know that.