As I understand it, the genie is not incentivized to honest. It is incentivized to not get caught being dishonest.
Since we care about the genie actually being honest, the technique can be thought about as a way of making it more likely that the genie is honest, with the threat of punishing dishonestly a component of that technique.
Since we care about the genie actually being honest, the technique can be thought about as a way of making it more likely that the genie is honest, with the threat of punishing dishonestly a component of that technique.