Jos, you have misunderstood. If you want to be precise about it (and therefore correct, in a limited sense), sanction can be used as a verb or as a noun.

Sanction means 'to ratify'. If you sanction something, you approve it. Doesn't matter whether it's approving something seen as positive or negative. But, in that sense, sanction is a verb - you are doing something. Sanction, as a noun, is only used in the sense of 'penalty'. In that context, yes, you are correct. But that isn't the whole of the word, nor its original usage.