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:
- Red flags are ignored — because staff fear raising them or believe no one cares.
- Compliance staff are marginalized, making it harder to educate or monitor.
- Misconduct festers in the shadows — as employees learn that leadership values results over rules.
- 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?
- 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.
- 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.
- Train the forgotten workforce. Interns, contractors, and agents often do the risky work. Make sure they are trained, monitored, and held accountable.
- 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.
- 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.
