My view is that it is a waste of time fining someone for something like this.
What would probably happen in FAA land is that you'd be mandated to retake the FI or CPL flight test, or a portion of it, with a FAA insepector. I reckon they should do this in the UK too. Let you keep the £500 but then ensure you "lose" your ticket until to take the remedial test to a satisfactory standard.