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Compliance Into the Weeds

Compliance into the Weeds: Unpacking the University of Michigan Football Scandal: Compliance and Consequences

The award-winning Compliance into the Weeds is the only weekly podcast that takes a deep dive into a compliance-related topic, literally going into the weeds to explore a subject more fully. Seeking insightful perspectives on compliance? Look no further than Compliance into the Weeds! In this episode, Tom Fox and Matt Kelly discuss the recent University of Michigan football scandal.

They draw parallels to the infamous 2017 Houston Astros sign-stealing incident and examine the numerous compliance failures within Michigan’s football program. Highlighted issues include impermissible scouting, leadership failures by Jim Harbaugh, marginalization of the compliance function, and the NCAA’s ineffective enforcement. The conversation highlights crucial lessons for corporate compliance, emphasizing the importance of documentation, intern training, cooperation in investigations, and maintaining robust enforcement actions.

Key highlights:

  • Michigan Football Scandal Overview
  • Impermissible Scouting and Violations
  • Leadership Failures and Compliance Issues
  • NCAA’s Toothless Enforcement
  • Comparisons to Corporate Compliance
  • Lessons for Compliance Officers

Ed. Note: Tom Fox has written a 5-part blog post series on the UM Cheating Scandal. It will be posted each day this week. You can view the full series on his blog, the FCPA Compliance and Ethics Blog.

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A multi-award-winning podcast, Compliance into the Weeds was most recently honored as one of the Top 25 Regulatory Compliance Podcasts, a Top 10 Business Law Podcast, and a Top 12 Risk Management Podcast.

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Blog

UM Cheating Scandal Part 2: A Culture at War With Compliance

In August 2025, the NCAA released its long-awaited Report on infractions committed by and for the University of Michigan football program. For compliance professionals, this case should be viewed not merely as a college sports story but as a case study in organizational misconduct, leadership failure, and cultural breakdown. Just as an FCPA enforcement action lays bare how companies slip into non-compliance, this NCAA decision reveals how one of the country’s premier football programs allowed systemic misconduct to flourish.

In Part 1 of this series, we looked at the factual background of the University of Michigan football program’s NCAA infractions case: the impermissible scouting scheme, recruiting inducements, failures to cooperate, and the repeat violator status that ultimately sealed the program’s fate. But if the facts explain what happened, they do not explain why it happened. So today, in Part 2, we consider the lack of a culture of compliance inside Michigan football.

The “why” lies in culture. And here, the NCAA’s decision is crystal clear: Michigan’s football program did not have a culture of compliance. The compliance office existed, it was well-resourced, and a respected Chief Compliance Officer staffed it. Yet the football program treated compliance as a nuisance, an adversary, even an enemy. For compliance professionals, this is where the story gets interesting. Because in sports, as in business, culture eats policy for breakfast.

The Adversarial Relationship with Compliance

The NCAA decision describes a “contentious relationship” between Michigan football and the university’s compliance office. Staff members regularly dismissed or mocked compliance staff. One recruiting staffer went so far as to describe them in a text message as “true scum of the earth.” Others referred to compliance as “roadblocks” or even “shitty at their jobs.” Indeed, UM’s Chief Compliance Officer herself acknowledged that she was “perceived as a thorn in [Harbaugh’s] side.” Even the athletic director noted the “tension” he observed between the two offices.

For any corporate compliance officer, this picture may sound all too familiar. You have a respected compliance function, staffed by experienced professionals, but the business unit sees them as the enemy. Compliance is viewed not as a partner but as an obstacle. When that perception takes hold, it is only a matter of time before rules are ignored, controls are bypassed, and misconduct proliferates.

Willful Blindness and “Not Wanting to Know”

The culture in Michigan football was not simply adversarial; it was deliberately blind. Regarding Connor Stalions’ elaborate signal-stealing scheme, multiple staffers admitted that “no one really cared how you got it done as long as you got it done.” A student-athlete noted that the staff “went out of their way not to know” what Stalions was up to.

Even when red flags were raised, they were dismissed. One intern reported that Stalions asked him to rent a car under false pretenses. When he brought this up to an Assistant Coach, including concerns about “signal stealing,” he was told the coach “did not want to hear any more about that.” Another coach, confronted by an opponent who accused Michigan of improper sign stealing, relayed the concern internally, only to be met with a shrug and denial.

This is the corporate equivalent of sales teams ignoring whistleblowers who raise concerns about improper payments, or executives waving away red flags because they don’t want to know. It is the textbook definition of willful blindness, a concept the DOJ and SEC regularly cite in enforcement actions.

Excluding Compliance from the Room

The Chief Compliance Officer testified that she and her team were rarely, if ever, invited into football operations by the football staff. Instead, they had to push their way in: “I can’t think of a time when we scheduled a meeting at football’s request. It was pretty much always us saying, hey, we’ve got to get in there, we’ve got to do some education”.

Obviously, this matters, even if only for optics. Compliance cannot be effective if it is excluded from the business. When compliance officers are locked out of meetings, ignored in decision-making, or treated as outsiders, they cannot monitor risks or detect misconduct. In corporate settings, we often see this when compliance is not given a seat at the table in M&A due diligence, sales strategy, or third-party onboarding. The result is predictable: compliance is left to clean up violations after the fact, rather than preventing them in real time.

Interns, Education, and the Forgotten Workforce

One of the most revealing details in the NCAA’s decision involves the interns. Stalions used interns heavily in his scouting scheme. They were instructed to attend games, film sidelines, and even help analyze signals. Some were unsure whether their actions were permissible. The Chief Compliance Officer admitted that Michigan had no targeted compliance education for interns. Here, you can recall HP and its FCPA enforcement action, where a contract employee was unsure how to raise compliance concerns. Interns came and went frequently, making them difficult to track. Compliance training was focused on full-time staff, not on lower-level interns.

Sound familiar? In corporate compliance, we often see companies that train executives but neglect contractors, temporary workers, or third-party agents. Yet these “lower-level” actors usually pose the greatest risks, precisely because they are less trained, less supervised, and more vulnerable to pressure.

The lesson here is straightforward: compliance education cannot stop with senior leaders. It must cascade down to every level of the organization, including temporary staff, contractors, and anyone acting on behalf of the enterprise.

Harbaugh’s Leadership and the Tone at the Top

At the center of all of this was head coach Jim Harbaugh. The NCAA made it clear: “Harbaugh did not embrace responsibility. He and his program had a contentious relationship with compliance, leading coaches and staff members to act, at times, with disregard for the rules”.

This is the compliance officer’s nightmare. When the leader of the organization treats compliance as an adversary, that tone cascades down. Staff pick up on it. Interns internalize it. Even student-athletes understood the message: compliance was not to be welcomed.

Tone at the top is more than a catchphrase; it is the single greatest driver of compliance culture. Regulators from the DOJ to the FCA in the UK emphasize it again and again. Harbaugh’s indifference or worse, hostility, set a tone that made noncompliance not just possible but inevitable.

The Cost of Compliance as “The Enemy”

The Michigan case is a powerful example of the dangers of treating compliance as the enemy. When business units (or in this case, football staff) see compliance as an obstacle, several consequences follow:

  1. Red flags are ignored — because staff fear raising them or believe no one cares.
  2. Compliance staff are marginalized, making it harder to educate or monitor.
  3. Misconduct festers in the shadows — as employees learn that leadership values results over rules.
  4. Investigations are obstructed — because a culture that disrespects compliance has no incentive to cooperate with regulators.

For corporations, the consequences are clear: higher penalties, damaged reputations, and, in some cases, existential crises.

Corporate Parallels: Uber, Wells Fargo, and Beyond

Michigan football’s cultural breakdown is hardly unique. We’ve seen the same dynamic play out in corporate scandals:

  • At Uber, a “growth at any cost” culture led to systemic misconduct and regulatory run-ins.
  • At Wells Fargo, sales culture so dominated compliance that millions of fake accounts were created, even as compliance officers raised alarms.
  • At Odebrecht, a construction giant, compliance existed on paper but was ignored in practice, allowing a global bribery scheme to flourish.

In each case, the lesson was the same: when culture treats compliance as an obstacle, violations become not just likely but inevitable.

The Compliance Officer’s Dilemma

One striking aspect of the NCAA decision is how much it sympathized with Michigan’s Chief Compliance Officer. The panel noted that she was “a well-respected leader in the industry” and that she “did everything she could to promote compliance.” Yet her efforts “were not welcomed. Instead, they were rebuked, dismissed, and disregarded”.

This raises an important question for compliance professionals: what happens when the business refuses to engage? What happens when leadership is openly hostile to compliance?

The DOJ has been clear on this point. It is not enough to have compliance programs that look good on paper. Regulators will ask whether compliance has sufficient stature, resources, and access to management. If compliance is marginalized, companies cannot expect leniency.

Lessons for Corporate Compliance Officers

What should compliance professionals take from Michigan’s cultural breakdown?

  1. Measure culture, not just policies. Policies are necessary, but culture drives behavior. Tools like employee surveys, exit interviews, and hotline trends can help assess whether compliance is trusted or distrusted.
  2. Fight for access. Compliance must be in the room where business decisions are made. If your team is always chasing after the business, you are already behind.
  3. Train the forgotten workforce. Interns, contractors, and agents often do the risky work. Make sure they are trained, monitored, and held accountable.
  4. Escalate leadership failures. If tone at the top is toxic, escalate to the board. Regulators are increasingly holding boards accountable for failing to address cultural risks.
  5. Document resistance. If business leaders are hostile to compliance, document it. This may protect you later and show regulators that the compliance function was not complicit.

Culture Wins Every Time

The Michigan football infractions case demonstrates what happens when compliance is marginalized. The Chief Compliance Officer could not overcome a culture that treated compliance as an enemy. Harbaugh’s tone at the top, combined with willful blindness, ensured that misconduct flourished.

For corporate compliance officers, the lesson is sobering: no matter how good your compliance systems are, culture will win. If leadership sets the wrong tone, compliance will fail.

Join us tomorrow, as we continue this series with Part 3, where we will examine the penalties Michigan received, including fines, suspensions, and probation, and draw lessons on how repeat violations, obstruction, and cultural failure influence sanctioning decisions.

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Word of the Week

Word of the Week with Kenneth O’Neal – Discussing Character: Importance, Decline, and Impact

Each week, Kenneth O’Neal discusses a word that describes a principle or value of the Qualities of Success. We suggest you use the Word of the Week in your thoughts, deeds, and actions. You may currently possess the qualities and desire to develop them to a higher level. You could replace a bad habit with a good habit. Write an action step and use it daily to produce the quality in your life. In this episode, Kenneth O’Neal and Rick Phipps discuss the word – Character.

Kenneth and Rick discuss the concept of character and its significance in personal and professional life, exploring the decline in character and moral standards over the past 25 years. They cite examples like Watergate and Enron to illustrate their points. The discussion includes the origins of the word’ character,’ the positive effects of strong character, and the challenges faced in maintaining it in modern society. They emphasize the importance of integrity, consistent values, and effective communication, drawing on historical figures like George Washington to exemplify strong character. The episode concludes with a call to action for listeners to reflect on their character and strive to do the right thing.

Key highlights:

  • Weekly Word: Character
  • The Importance of Strong Character
  • Decline in Character and Cultural Values
  • Historical Examples of Character

Resources:

KRONEAL Consulting

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Daily Compliance News

Daily Compliance News: August 4, 2025, The Market-Based Culture Edition

Welcome to the Daily Compliance News. Each day, Tom Fox, the Voice of Compliance, brings you compliance-related stories to start your day. Sit back, enjoy a cup of morning coffee, and listen in to the Daily Compliance News. All, from the Compliance Podcast Network. Each day, we consider four stories from the business world, compliance, ethics, risk management, leadership, or general interest for the compliance professional.

Top stories include:

  • AT&T CEO ditches ethics-based culture for market-based culture. (Business Insider)
  • Ukraine announces arrests for military procurement corruption. (NYT)
  • The first insider trading conviction for NFTs is overturned. (Reuters)
  • Asia’s ‘scamdemic’ problem. (Bloomberg)

You can donate to flood relief for victims of the Kerr County flooding by going to the Hill Country Flood Relief here.

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Compliance Tip of the Day

Compliance Tip of the Day – AI, Whistleblowing and a Culture of Speak Up

Welcome to “Compliance Tip of the Day,” the podcast where we bring you daily insights and practical advice on navigating the ever-evolving landscape of compliance and regulatory requirements. Whether you’re a seasoned compliance professional or just starting your journey, we aim to provide you with bite-sized, actionable tips to help you stay on top of your compliance game. Join us as we explore the latest industry trends, share best practices, and demystify complex compliance issues to keep your organization on the right side of the law. Tune in daily for your dose of compliance wisdom, and let’s make compliance a little less daunting, one tip at a time.

How can AI enhance your whistleblower program, improve your culture of Speak Up, and crowdsource intelligence from your employees?

For more on this topic, check out The Compliance Handbook, a Guide to Operationalizing Your Compliance Program, 6th edition, which LexisNexis recently released. It is available here.

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Innovation in Compliance

Innovation in Compliance – The Power of Accountability and Team Culture with Gina Cotner

Innovation comes in many areas, and compliance professionals need to be ready for it and embrace it. Join Tom Fox, the Voice of Compliance, as he visits with top innovative minds, thinkers, and creators in the award-winning Innovation in Compliance podcast. In this engaging episode, Tom Fox sits down with Gina Cotner, the founder and CEO & Founder of Athena Executive Services, to explore the importance of team culture and accountability in corporate settings.

Cotner delves into her professional background and the organic development of a strong team culture at Athena. She emphasizes the critical role of accountability as a cultural standard and provides actionable insights for leaders on how to instill this within their organizations. Key takeaways include the significance of consistency, the balance between compassion and accountability, and the role of follow-up as a leadership tool. With real-world examples and practical advice, Cotner provides a comprehensive guide to building and maintaining a high-performing, accountable team.

Key highlights:

  • Gina Cotner’s Professional Background
  • The Importance of Team Culture
  • Accountability in High-Performing Teams
  • Misunderstandings About Accountability
  • Building a Culture of Accountability
  • Consistency and Psychological Safety
  • Follow-Up as a Leadership Tool
  • Compassion in Leadership

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Hill Country Hustlers

Hill Country Hustlers: A Journey to Hill Country Hospitality: Jenny McCombs of Full Moon Inn and 1776 Bar

In this episode of the Hill Country Hustlers podcast, host Zachary Green chats with Jenny McCombs, the co-owner of Full Moon Inn Bed and Breakfast and the 1776 Bar in Fredericksburg, Texas. Jenny shares her journey of fulfilling a lifelong dream to live in Fredericksburg, her transition from running a flower shop to owning a B&B, and the unique challenges of managing a historic property. She discusses the community feel of her business, the importance of personal touch and hospitality, and their efforts to create a welcoming environment for guests from all over the world. Jenny also highlights their enthusiastic local engagement through events like live music nights and community potlucks, as well as their vision of using their success to support and uplift others in their community.

Key highlights:

  • Behind the Business: Meet Jenny McCombs
  • Inside the Full Moon Inn Experience
  • Community, Culture & Connection
  • Patriotism and Purpose at 1776 Bar
  • Lessons in Life, Faith & Business

Resources:

Zach Green on LinkedIn

Jenny McCombs on Facebook

Full Moon Inn Bed & Breakfast Website

1776 Bar on Facebook

Full Moon Inn on Facebook

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2 Gurus Talk Compliance

2 Gurus Talk Compliance – Episode 54 – The FCPA is Back On Edition

What happens when two top compliance commentators get together? They talk compliance, of course. Join Tom Fox and Kristy Grant-Hart in 2 Gurus Talk Compliance as they discuss the latest compliance issues in this week’s episode!

Stories this week include:

  • DOJ’s New FCPA Playbook: ‘Time to get to work’ – Ropes & Gray
  • Thought from the Compliance in AI Conference—Kristy attended
  • Building brands with culture—Fast Company
  • How to Say No at Work—Wall Street Journal
  • Fake cop pulls over real cop on I-4, gets arrested, authorities say—WESH 2
  • What does the crash mean for Boeing? (⁠BBC⁠)
  • The CITGO auction date has been extended (yet again). (⁠Reuters⁠)
  • Rubio is pressing OFAC to investigate Harvard. ⁠(NYT⁠)
  • Brad Bondi loses the DC Bar election. (⁠Reuters⁠)
  • The EU levies fresh sanctions on the Nord pipeline. (NYT⁠)

Resources:

Kristy Grant-Hart on LinkedIn

Prove Your Worth

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Compliance Into the Weeds

Compliance into the Weeds: The COSO Governance Framework

The award-winning Compliance into the Weeds is the only weekly podcast that takes a deep dive into a compliance-related topic, literally going into the weeds to explore a subject more fully. Are you seeking insightful perspectives on compliance? Look no further than Compliance into the Weeds! In this episode of Compliance into the Weeds, Tom Fox and Matt Kelly discuss the recently released COSO Corporate Governance Framework.

Tom and Matt take a deep dive into the new COSO Corporate Governance Framework draft. They discuss the importance of public comment on the draft, which is open until July 11, and explore the framework’s six key components. The framework aims to provide discipline in achieving good governance within organizations, covering areas such as strategy, culture, human resources, and resilience. Kelly highlights the significance of culture in compliance and the role of information quality in the future, providing practical tips on implementing and testing the framework. The episode highlights the importance of this framework for various stakeholders, encouraging practitioners to review and provide feedback on the draft.

Key highlights:

  • Overview of COSO’s Draft Corporate Governance Framework
  • The Six Objectives of the Framework
  • Importance of Culture in Compliance
  • Principles and Points of Focus
  • Resilience in Corporate Governance

Resources:

Matt Kelly in Radical Compliance

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A multi-award-winning podcast, Compliance into the Weeds, was most recently honored as one of the Top 25 Regulatory Compliance Podcasts, a Top 10 Business Law Podcast, and a Top 12 Risk Management Podcast.

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Culture Crafters

Culture Crafters – Navigating Business Volatility Through Corporate Culture

It is always interesting when the regulators catch up to the business world. That is what has happened around corporate culture. The Department of Justice is now assessing corporate culture for any company under investigation. Yet, more than simply complying with this mandate, companies should strive to cultivate the best culture possible. The reason is deceptively simple: the better the culture, the better the company. However, many business executives and even compliance professionals are unaware of how to create a culture that enables their employees, and thereby their organization, to implement such strategies. How can you unlock the power of a thriving workplace culture?

In this episode, host Tom Fox visits Sam Silverstein and Tara Stone to explore the impact of corporate culture on an organization’s ability to navigate volatile business environments, specifically using the recent tariff fluctuations as a backdrop. The conversation delves into how preemptively fostering a strong corporate culture can help companies withstand and even thrive during periods of significant change. Key emphasis is placed on the importance of trust, communication, accountability, and maintaining core values. Both Sam and Tara share insights on how leaders can prepare their organizations during stable times to better handle future challenges, drawing on their experiences and frameworks for building high-performance workplace cultures.

Key highlights:

  • Understanding Volatility in Corporate Culture
  • The Role of Trust in Navigating Volatility
  • Embracing Change and Overcoming Fear
  • Accountability and Leadership in Turbulent Times
  • Building Trust and Core Values

Resources:

Sam Silverstein

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Sam Silverstein

The Culture Audit™

Tara Stone

Tara Stone on LinkedIn