Calling form_set_error() in custom validation code does not cause form submission to fail

I'll paste the code below but basically, even though I call form_set_error(), webform is service up the confirmation page. You do see the red error boxes on the confirmation page however ...

Here's my code that should cause webform to redisplay the form along with a form error:

  if (preg_match('#'.$ok_string.'#', $html) != 1) {
    //Can't find the ok string so the login must have failed. Tell user bad login, try again
    form_set_error('submitted][username', t('Couldnt find ' . $ok_string . ' in result'));
    form_set_error('submitted][password', t('Unable to log in. Incorrect username or password?'));
    curl_close($crl);
    return;
  }