Computer generated *manufacturer's* coupons, sure. (50c off Tide or what have you.) But most stores accept their own store coupons that came off the internet - that's sort of the point of putting them on the internet!
The fraud was this - people were figuring out ways to print hundreds of copies of coupons, and then using them. The biggest problem was with free items like free Dove soap or free Maybelline lipstick. Some people figured out they could set their printer default to 100 or whatever ridiculous number they wanted, and the coupon would print that many. Other people figured out how to capture the image, then print as many as they wanted. Then, TONS of free stuff! It wasn't too long after that that people learned how to not only capture the image, but then manipulate the image to make it say something it hadn't originally, which would result in greater savings than intended.
The coupon software is much better these days (if you set your printer default to anything but 1, they won't print anything at all, at least with the big coupon software companies), but the stores are sticking with their rules anyway.