You need to have an alternative, and it needs to be a credible and reliable one, to ensure that it does not end up being the case that one scam is replaced with another scam.
We have carved out a class of engagements, labeled it deeply asocial, criminalized it and now we pursue people who engage in it through legal means.
Business really doesn't have this. Personal example - last week I was at a place where the business owner tried to overcharge me by an order of magnitude and then verbally attacked me when I caught him and backed out of the transaction.
His google and yelp reviews are full of people claiming false charges and all kinds of fraud, refusal to correct and repeated abuse until they closed their cards. It's wildly obvious what's going on here and I was on the ball enough to catch it.
I contacted the police and they said "well you should call the BBB or something". It's dozens of reviews of clear credit card fraud and for some reason because he's a merchant, doesn't seem to hit the radar.
These are purely criminal matters - people acting habitually in bad faith with ill intent in a brazenly dishonest manner.
Whether it's plundering the commons, polluting the public discourse, or breaking other types of social compacts, these should be treated the same as any other crime.
You do have points, though, but there might at least be some actions that you and others can take in this case. Maybe a medium change like changing the law on this specific point might make sense.
If there's an accumulation of complaints against this merchant then that should warrant an investigation.
The police have like half the local city budget, can't they do their job?