Interesting, this is the first I've heard of the "reputation rehab" angle on the guy. Do you have any further reading you could link me to?
Rather than going full Inglorious Basterds, I think it's important to have both "carrot" and "stick" options for these people. It doesn't really do us any good if there's no way to come back from having been involved in hate groups. Just make sure to keep the Richard Spencer treatment available, to provide them some motivation to get their heads right.