Alright, so this person got promoted to TL3 manually by a mod. However, he’s way past the 5-flag limit during their TL3-ness and still has not lost TL3. So is it possible to lose TL3 if it’s manually granted and not naturally granted?
No.
They are locked in. They need to be unlocked by a full moderator or higher and they will revert to the level they should be.