Monk AC Penalty
 

So after you go above 14.9/18.9/22.9 stones you incur an armor class penalty.

Does anyone know how severe this penalty is or how it grows the more weight you carry?

Is there a cap? Or can your AC go all the way to 0?

Interesting - I did a little messing around. It appears that there may not be a simple answer to the AC penalty question. My level 33 monk shows no penalty until he hits 17 stone. At 16.9 stone, no penalty. From there, the difference appears at transition from x + .9 to x + 1.0 stone up to and including +30.0 stone, but may be at different points after that. I do not know if there is a cap, though I suspect before your AC hits zero you are encumbered to the point where you cannot move anyway.
stone AC
17.0 -3
18.0 -8
19.0 -12
20.0 -15
21.0 -20
22.0 -23
23.0 -27
24.0 -32
25.0 -35
30.0 -55
35.0 -59
40.0 -68
100.0 -107

There's a post about it somewhere from 2009-2010, but the Inventory screen does NOT display Monk AC values properly, especially with weight penalty. It is a known issue.

I will try to look for the post now.

I believe this was described in a set of patch notes from some months back.