We do not "punish" anyone. We vote against their up vote, simple as that. And we only do it for the top most comment self votery voters per day. Previously that was measured by their self vote reward but now we are adjusting for SP. If any account meets this criteria then they will be flagged.
We act in order to affect change on the system. There would be no reason to act against self voters unless the system was insufficient in this area, so you have it backwards.
We're going to keep evolving the algorithm so perhaps the better way for you to go here is look into it and make some suggestions for improvement if you think there should be some. I respond to everyone.