Yes and no. It is better than nothing, but it is far from perfect, or even being very good! I have also seen many ads where all the pics are obviously fake (there was one lady running ads with pics of porn star Raven Riley for months on BP/Craigslist) and Tineye never did pick up on the picture being fake. Sometimes it will only hit on one picture and not the others. I don't know how it works exactly, but it is not a perfected science.
It is just one tool of many to spot a fraud, and should not be relied upon as the end-all, be-all of screening instruments IMHO. Screen and get references above all else, and read reviews on sites like this for best results I think.