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I've seen a system like this work on several forums but like anything else it requires a certain amount of moderation. For one being able to give negative reputation should not be possible as this is GREATLY abused between members who don't like each other. It's human nature, that simple  . With that, the reputation system becomes somewhat of a record of good posts without any negative things in it (we can leave that to the moderators, who are afterall qualified to do exactly that, determine whats right and wrong. If we would have members do that us moderators would become useless.). The forum that has it in effect recently also made abuse of the system punishable by warnings and even bans. Users would for instance request reputation at the bottom of a topic or have a "Rep me and I'll rep you" sentence in their signature. This has since then stopped.
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These were exactly the concerns I had in mind, but seems there is an answer to it after all.