legal Undershirt?

[Jurassic Referee]

And in the same vein....

This was brought up by Freddy as a result of a badly-written test question....

Casebook play 3.5 SITUATION B:
The officials are on the court prior to the game observing the team warm-ups. One official notices that a member of team A is wearing a decorative necklace.
RULING: The official shall inform the team member to remove the jewelry immediately. Upon compliance, the team member may continue to warm up with his or her teammates and may start the game without penalty.

Questions:
1) What do you do if the team member refuses to remove the jewelry immediately?
2) What, if anything, is the penalty for that refusal?
3) Does the same ruling(s) apply to illegal undershirts?

Inquiring minds need to know!