If you're a rational criminal, you might think along these lines: * I am considering committing a crime that is worth X to me. * The price (punishment) for th

If you're a rational criminal, you might think along these lines: * I am considering committing a crime that is worth X to me. * The price (punishment) for this crime is Y. * I only have to pay the price if I'm caught and convicted, both of which have some probability between 0 and 1. So the effective price for committing this crime is Y multiplied by the probability I'm caught and convicted. If X > P(caught) * P(convicted) * Y Then I should commit the crime. Otherwise, it's not worth it. For financial crimes, it's safe to say that P(caught) and P(convicted) get lower and lower the richer and more powerful you become. You have access to the best accountants and attorneys, making certain financial crime reliably profitable and increasingly attractive. Therefore it stands to reason that while there is a line past which a punishment becomes excessive, an effective punishment must lead would-be criminals to decide that the risk is not worth it. Until this is the case, we have to either increase P(caught & convicted), or else increase Y; we can't do neither. Probably increasing both is best; an increase in fines (Y) could fund the increased enforcement (P) necessary. Good luck passing those laws, though.