Michigan’s Real Punishment? A $20M-Plus Gut Punch That Deserves Our Attention

Forget the headlines about suspensions and show-cause penalties — Joel Klatt says the real hammer in the Michigan sign-stealing saga is financial, and it’s brutal.

With fines that could eclipse $30 million, Klatt argues the NCAA has quietly delivered a blow that could be more severe than most fans and pundits realize.

“If we talk about this from a pro perspective, as the money grows in college football and we get into revenue sharing, what’s the most penalizing thing that you can do to a program that affects them right now? Take away revenue,” Klatt said on his podcast, “The Joel Klatt Show.” “So, the fine of upwards of up to $30 million isn’t a small fine. Some will say it’s the price of doing business, and they’d pay it every year if it guaranteed us a national championship. 

“That’s fine, but, in the era of revenue sharing, I will tell you that every athletic director across the country — whether it’s Big Ten or SEC athletic directors — all they talk about is revenue. All they talk about is finding money, because they don’t feel like they have enough to keep the entire program up to speed.”

Thanks to the approval of the House v. NCAA settlement in June, schools will now be able to pay student-athletes directly through a revenue-sharing model. But there is an annual cap that each school has to deal with. For the 2025-26 academic year, schools have a limit of roughly $20.5 million to pay all of their student-athletes.

“They’re going to have to share the $20.5 million and still find all this money for all of their other sports,” Klatt explained. “So, when you fine a school like Michigan $30 million, it’s not small. I feel like that was the right way to go for them. The other thing you can do is hinder their way to build a roster. That’s how they do it in the NFL. They’ve got to do some convoluted things on when and how you can recruit.”

As Klatt mentioned, the NCAA’s penalties against Michigan also included recruiting restrictions. Head coach Sherrone Moore’s program will have a 25% reduction in football official visits during the 2025-26 season and a 14-week prohibition on recruiting communications during the four-year probation period.

However, it doesn’t appear that Michigan has felt the wrath of the recruiting restrictions yet. Four days after the penalties came down, the Wolverines were able to land five-star recruit Savion Hiter, who is widely viewed as one of the top running backs in the 2026 recruiting class.

While the fines could hurt Michigan down the line, the Wolverines were also hit with penalties when the news of the scandal first broke, as the Big Ten suspended then-Michigan head coach Jim Harbaugh three games on the eve of its matchup against Penn State in November 2023. 

While Michigan defeated Penn State and Ohio State without Harbaugh, Klatt believes that the suspension could’ve derailed the team’s national championship season. 

“Harbaugh flew with the team to Penn State and was at the hotel, but he was suspended for the game,” Klatt said. “That’s a lot of distraction when you’re about to play on the road against a top-10 opponent. That’s not nothing. For some people, this punishment is not going to go far enough. That’s fine. I totally understand that. I think if you’re Michigan, you look at this and even think, ‘Man, I think we got off pretty easy.’ But let’s not forget that for the most difficult and important games of that season, they had to play without their head coach, Jim Harbaugh.

“Harbaugh was not there for the Ohio State game, and that was a game between two undefeateds and the loser was not going to the playoff. The loser was not going to the Big Ten Championship Game. So, if Michigan loses that game, the national championship doesn’t happen. I think from Michigan’s side, they would’ve said that’s because ‘our head coach wasn’t there.’”

Harbaugh was also penalized for his role in the sign-stealing scandal by the NCAA, receiving a 10-year show-cause on top of the four-year show-cause he’s already serving due to previous recruiting violations. Connor Stalions, the mastermind behind the scandal, received an eight-year show-cause penalty.

Klatt noted that Harbaugh is “never coming back” to Michigan, as he’s now the head coach of the Los Angeles Chargers. Klatt also thought the suspension the NCAA gave Moore wasn’t significant as it tagged on one game to the already self-imposed two-game suspension he was set to serve for the 2025 season. In total, Moore will miss Michigan’s third and fourth games this season, while also missing Michigan’s season-opener against Western Michigan in 2026.

Sherrone Moore will be suspended for three total games as a result of the sign-stealing scandal. (Photo by Michael Hickey/Getty Images)

“I immediately thought, ‘Oh, they gave him the Oklahoma game as well,'” Klatt said, referring to Michigan’s Week 2 matchup against Oklahoma. “The NCAA grew a spine and said that’s not enough. So, you’re also going to sit out the Oklahoma game, which would hurt them as a team and him personally, because he went to Oklahoma. … What are we doing?”

Still, while some might scoff at the idea of a fine being a harsh punishment, Klatt argued that it was the best the NCAA could do – and it might be pretty effective.

“I said when the investigation finishes and pending what they actually did, if rules were broken, then they should be punished. So, good. I’m glad that they’re getting punished because clearly rules were broken,” Klatt said. “Was the punishment fair? Did the punishment fit the crime? … I never want to penalize a current player who had nothing to do with this for some actions of some people who aren’t in the program anymore.”

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