As a mutual fund shareholder, you wanted to believe there would be no more scandals, that the bad guys had been caught, would be punished and that the worst was over. You'd have been better off believing in the Tooth Fairy.

An agreement reached last week between former Putnam Investments top dog Lawrence Lasser and the U.S. Securities and Exchange Commission shows all too clearly why "minor" scandals will keep happening in the business for years to come.

That's an ugly conclusion to draw about the business, but it's the logical supposition in light of the Lasser deal, which scarcely drew a headline when it was made public.

Lasser is the only fund company executive charged so far with fraud for authorizing payments to brokers for preferential sales treatment. Putnam paid $40 million to the SEC in 2005 to clear up charges that it never told fund investors or directors that it was paying for "shelf space," or the chance to have brokers make the firm's funds more of a sales priority.

These "revenue-sharing" deals are fairly common, and Putnam is far from alone in being targeted by regulators. Yet in virtually every other case where firms face charges over revenue-sharing deals, it's the business with money on the line; individuals are pretty much ignored.

Broaden the scope to other nefarious activities, and you'll find that the only times executives were named — such as Dick Strong of the Strong funds agreeing to a huge settlement with regulators — was when they were directly involved in allowing rapid trading and circumventing fund rules; without that kind of direct link, however, most actions have been against the business rather than individuals.

The Lasser case was seen as a step up in enforcement, a sign that regulators wanted top managers to know that their necks are on the line. Forget about it: The settlement amounted to $75,000, a one-fingered slap on the wrist.

How inconsequential is that amount to Lasser? Consider that when he left Putnam, his severance package was worth $78 million, and that the company agreed to pay his legal fees. The settlement is less than one-tenth of one percent of Lasser's out-the-door money, never mind the tens of millions of dollars he earned running the company.

Lasser was known as a control freak, the kind of guy who dictated the small stuff — ranging from the food in the executive lunch rooms to the efforts of the sales staff — and that is part of why regulators pursued a case against him where they let other top executives skate. (It does not explain why regulators have not pursued the operatives further down the ladder, the guys who actually made these bad deals happen.)

Now 63, Lasser is retired and living in Brookline, Mass., apparently considering his next move; the settlement does not limit his future participation in the securities business.

Better than nothing? Hardly

That said, people close to the case suggest that the SEC had the choice of reaching this settlement or letting the case drag on and potentially getting nothing. With Putnam paying Lasser's legal fees, the former executive could have afforded to let the case linger forever; insiders suggest that getting something from Lasser was better than getting nothing

They may be wrong, because the broader implications of such wimpy "increased consequences" are clear. The next time an executive is considering some sketchy activity, their thought process could go something like this:

"If I can get away with an action that helps the firm make money — getting a rich salary, bonus and severance package in the process — I can earn enough to be set for life, even if I someday must pay a few grand for sticking it to shareholders."

Since the rapid-trading/market-timing controversy was set off by the New York Attorney General Elliot Spitzer in 2003, the fund industry has seen a range of troubles that amount to "skimming," like the revenue-sharing deals or the kickbacks that some small funds purportedly paid to service firms running their back-room operations.

Seen individually, these cases are not earth-shaking. You're not going to find an investor who can claim to have lost their entire retirement-savings portfolio to this kind of fraud, the way the public saw Enron and WorldCom investors lose everything when those corporate scandals rocked the world.

Have one traumatic fraud that makes an investor lose everything, and you have a case that makes for great drama. This is why Congress is so focused right now on regulating hedge funds, where potential blow-ups are cataclysmic. But a mutual fund is a large pool of investors; skin each of them for a penny here or there and you can wind up making millions while barely upsetting people enough to complain.

Fund industry executives have said that the public reaction to Putnam's involvement in the scandals — investors removing billions of dollars from the firm's funds, angry about governance and performance — shows why the fraud will stop.

But when top managers face a penalty that amounts to a warning of "Don't do this again," and when the guys in the trenches face no real consequences, there's not much deterrent to acting in bad faith.

That's not to say that funds are bad for investors, or that all executives are dirty, because that dramatically overstates the case. Still, expect a host of niggling little frauds to come to light over the next few years, greeted by quick settlements where management feels bad, right up to the point of celebrating the resolution of the case at the nearest bar.

"There are some 'everyone-is-doing-it' abuses that no one seems to be really getting punished for," says Mercer Bullard, founder of Fund Democracy, a shareholder advocacy group. "We'll see more cases, but there will always be another angle, at least until someone decides that hurting shareholders this way deserves real punishment."

The message from the Lasser settlement is clear: That kind of punishment isn't happening to fund executives any time soon.