Maybe.
But it is part of CAA regulations: https://www.caa.co.uk/commercial-industry/airlines/dangerous-goods/changes-to-rules-on-the-carriage-of-lithium-cellsbatteries-and-power-banks/

Must be in carry-on and cannot be used in flight.
So, technically the plane was flying illegally.
Fires on planes are NO joke. And lithium batteries love fire, whether starting it themselves or getting hot enough to set other things on fire.

How they discovered it was charging in the hold during flight, I have no idea.
It had to have been a passenger mentioning it.
The cargo hold is completely sealed off from in-flight accessible areas (some older planes have small access hatches that require tools to open).