Domain Tasting was a problem for a few years, but let's be honest, 99.99% of the best stuff was taken beforehand. Domain tasting focused a lot on expired names, monitoring DNS/whois and frontrunning. It was but a hiccup in the timeline of domaining.

As far as punishment, looking ACPA, 100k penalty for cybersquatting. That's taken out some of the biggest offenders (see IREIT).