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That's about how I would do it, although I would jump right to have a nice day and not offer an opinion on the likelihood of assessment. Bottom line is that the client has no obligation to do anything other than to fix the problem by depositing the lost earnings.

Nope.

A 401(k) plan with Safe Harbor only contributions is generally exempt from the Top Heavy provisions. You can google for the cite.

This is too complicated to be discussed without having counsel review all of the applicable laws including the rules under FINRA that govern the payment of commissions to registered reps. I know Series 7 brokers who are brokers of record on their own IRA accounts or accounts of family members who avoid ERISA/PT issues by waiving their commissions. I don't know if this would be a PT if the Broker received incentive comp or bonus from plan sponsor for meeting certain level of commission sales even if no commission is paid on the 401k trades. Financial services industry comp is extremely complicated and there are many forms of comp that may be a problem when retirement plans are the client.

You could also set up your own SIMPLE IRA and make up the difference to $18,000 in that plan. If you're 50, you ought to be able to get to a total of $24,000 between the two SIMPLEs (plus the SIMPLE IRA employer contribution of up to 3%).