That is a recipe for disaster, people would be anonymously spamming CSEM to other people online, calling the police on them for various reasons, like revenge, or simply to troll them. There is also an issue of proving that a person saw such materials. How can you know that? How can you verify it? And how can you prove, that it was intentional? Besides, seeing such materials isn’t a problem. It’s not wrong because it’s a sin, it’s wrong because real people are hurt in its production, and once produced, the distribution of such materials affects such victims even long after their experiences. The main problem is production and distribution, fighting those two naturally affect the possession.
I assume you are talking about possession, but not distribution and production. If that is the case, the financial penalty with the addition of permanently taking away such materials from such person, instead of jail time, seems reasonable, mainly because it could reduce the incentive for malicious individuals or groups to frame someone by dropping some of such materials into their home or on their drives, to use the law enforcement against them. Governments sometimes like to use that tactic on inconvenient individuals, in order to discredit them in the public eye, and as an excuse to enter someones home and take away their belongings legally. Kind of like in the case of drug possession laws, when some corrupt cops plant some drugs while searching someone’s car or enter peoples houses under the suspicion, of possession of drugs.
It’s way harder to frame a person for production and distribution, and in those cases, the law enforcement needs the legal ability to disrupt such activities permanently. A financial penalty instead of jail is definitely a wrong idea.
Life in prison - yes. Death penalty - no, for as long as our legal system isn’t perfect and makes mistakes.