I think the flaw is human nature. All governments and organizations are corrupt. All implementations are always twisted to suit the greed of individuals.

It's entirely possible to create policy and enforcement mechanisms that would mitigate or eliminate excessive greed but nobody with anything votes for it because they'll lose out on their own personal greed by their measure. They want that chance to fleece the masses even if they aren't in the club that's already doing it.

Blame humans.