No it more like you've been punished and went to jail in country A(stars), so went into hiding in country B(fulltilt), but now country A occupied country B so your pretty much fu**ed.
''I got punished for my 'crime' and i can't believe that i'm not allowed to play online poker anymore because of that one time mistake!!''
Well thats pretty much what a life-time ban means. Not saying this is fair, should probably be a 5-10 year ban depending on what you do but its their rules and if you want to play there you have to follow them. People do stuff much worse then cheating at poker and they don't get a life-time imprisonment.
As for your punishment transfering between site's this is pretty logical imo. If you get banned on one site for cheating you should get banned on every site, but since the market isn't regulated this isn't possible.
That being said i think they should not confiscate your founds on FT, but they are fully in their rights in not letting you play there. You have cheated on their site(stars) and now full tilt is their site as well and letting you play there would just be dumb.
Like i said you can take it up with their support, but being banned for cheating your chances are pretty slim.