I don't think you'd be able to suspend him for more than a year, but he absolutely should be.
If it's true that he asked Toronto and the Lakers to add similar things to his contract, while he was a free agent... then he was way more complicit that a guy who didn't turn down free money.
The GM should be relieved of their duties, and banned from the league
And Balmer should be forced to sell the team. Way too blatant circumvention of the rules.
Taking draft picks and cap space, only punish the fans. Punish the people involved instead