Does it matter if it's illegal? To you I mean. You're still sleeping at night right? Speeding's illegal, streaming TV shows is illegal, smoking pot's illegal, not declaring tips is illegal.. have you never done any of these things? Unless you're a cop, I wouldn't worry so much about it. Morally, he's not hurting anyone.
And no, using iOS Betas without a developer account is not illegal. Frowned upon is a better phrase.
I think if there is a poster here who hasn't done all of those things, he or she should be slapped in the face for not living life.