Does the punishment fit the crime? In this case, how is such a level of trading in the account of an elderly person in order to generate commission revenue any different from theft? Why is a $5,000 fine sufficient to punish that theft?  Why is the broker not responsible for the customers' full losses?   

In many cases, it seems that the regulators over-punish technical violations of complicated rules where no harm is done. Here, there is a clear act of malfeasance, but…

This is a good illustration of the fact that a firm can be subject to a legal violation for failure to supervise even when, as in this case, there is no resulting violation of the substantive rule.

See also yesterday's story: .  

One question that needs to be answered is whether it is appropriate for the government to step in and establish prices, as opposed to allowing them to be set by market forces. Or is it the case that market forces can not work here because consumers are the injured third party in the fee dispute and they are not well positioned to enforce their preferences; e.g, by moving their accounts to another bank which charges lower fees? If the government does establish a fee schedule, what is the…