Well, enforcing character traits upon character is a bad thing anyways IMHO to roleplaying muds. Every individual character has it's own traits and characteristics. Enforcing racism among your players would be like forcing all your players to be close to nature or explorers... In a non-themed RP envireoment, this simply can't be a good thing as some races tend to be more open and socially accepting then others, while other races border on xenophobia.

Then again, if this mud in question is a themed mud, say something post-apocalypse or post-war, then it might make sense. It still would be a bit bit of a leash on RP, but in such a case it might be acceptable. Sadly, no links to reviews/muds are given so I can't check out what kind of mud it is...