Well, that's shooting own leg for government and people: 1. This is a business which generates taxes 2. This is a business which generates employment 3. This is a business which provides a service to people and current clients will suffer from shutdown.

If you can simply fine it hard enough to make them stop cheating like that in future, that should be more than enough. Simple fines to make cheats unprofitable should do the thing.

Also the rule "to shutdown" the entire division might be misused on the wrong way or to blackmail the business. Once you shut down the division, it's much harder to reverse it, than simply to return a fine.