I've had more time to think about this, and the answer is simple - they
have to hammer them, because if they don't it then gives a free pass to the Saudis owning Newcastle to do the same thing, and whoever comes in and buys the next club, then the next one. Nip it in the bud now and show that the sport cannot be bought as easily as this.
- Strip them of their titles - all of them, leagues and cup wins. Titles do not get awarded to 2nd place teams, they show 'no winner' instead. There is no joy to be had of being awarded a title by default, it cannot be celebrated and keeping 'no winner' on record will remind us of what happened. Also, it prevents Gerrard getting a winners medal

- Demote them to League 2, at least. They've cheated to a massive scale and need to be punished for that accordingly. Demotion must happen.
- A serious point deduction for next season, say -30 - enough to make sure they don't go up first time of asking. If the demotion is only a single league, then increase the points deduction. They can't be in a position where they go down for a season and come straight back up to the PL.
- Transfer ban for a significant amount of time, 2-5 years.
- Ban from European competition for 5-10 years (depending on demotion).
The above doesn't take into account potential financial claims from clubs who have been relegated from the PL due to losses or goals conceded in games against them. Nor does it include teams that have been eliminated from domestic cup competitions, for whom potential extra revenue would have been important. Also, there will be European teams who have been eliminated from the CL, either entirely or been demoted to the EL, for whom that loss of additional prize money and TV rights will have made a serious impact to.
They of course have to be proven guilty of the most serious of crimes alleged against them for any of the above to happen, which is the difficult part, as I am positive that they will fight this for years, whilst continuing to be more 'creative' with their accounting in the meantime.