My understanding is that when a user completes a suspension any past misdeed or ill-advised behavior is forgotten. It does not prevent such a user from being nominated for the position of moderator. Only if that suspension concluded within the last 12 months would they even be shown the banner advising that their candidacy appeared problematic - see Make rules about candidate eligibility due to suspension more apparent.
If elected as moderator, then every action they take is visible to the other moderators, and most of them are visible to the community too. Consequently, I have confidence that they would not be able to act in contravention of the Code of Conduct while in that role, and I would not anticipate them trying to.