The financial penalty is fair (4)
I believe the answer is:
fine
This clue is a double definition.
'the financial penalty' is the first definition.
(a payment extracted as punishment)
'fair' is the second definition.
(I've seen this before)
'is' is the link.
(Other definitions for fine that I've seen before include "Splendid - financial penalty" , "A financial penalty - excellent" , "Eric" , "Fee payable for misdemeanour" , "An exquisite penalty?" .)