That's a very sensible decision. Second chances should always be offered to people, but never third chances. If someone can't learn from their mistakes and take a second chance seriously than I have no time for them at all.
Come on Zabini, you strike me as far too intelligent to let the Ministry Gossip machine get to you. If everything that is popular opinion was true than Harry would be dating the Minister and Lavender and I would be having a competition to see who can sleep with every male member of the Department of Magical Law Enforcement first.