I paid a fine in the underground today!

I never ride in the underground without buying a ticket and I usually get very good care of the ticket that during all the years of using the undergound I only lost my ticket once, about 2 or 3 years ago, and this because I was trying to catch a train and was really in a bad state as it was during the same week when my aunt, God bless her soul, passed away. However, today was my second appointment with such unfortunate event. I wasn't in a hurry but I was reading a novel (Persuation by Jane Austin)which I took out from my bag while waiting for the undergound to continue, as the undergound is always delayed in the afternoon. This was probably the moment when I dropped the ticket but I didn't realize this till I got down and searched for it but found nothing. I could have passed after any passenger like I see people do everyday but to preserve my dignity, I just went to the officer and told him that I've lost my ticket and to prove to him that I wasn't riding without a ticket I showed him the an extra ticket that I had in my wallet from the day before. However, he insisted on me paying the fine. I'm not upset because I had to pay a fine because from the time I realized that I've lost the ticket I was prepared to that (and I'm usually a person who likes to stick to the rules ) and I'm not upset form the man for doing his job but what I'm made about is that I see people sneaking out everyday under the officer's sight and he (may be not the same person)doesn't move a toe. So what is the rule here? and how is the law applied? and most of all when?!