What I am writing about USC does not address the Penn State situation at all. I am as disgusted about Penn State as any reasonable person should be, meaning I am totally and thoroughly disgusted.
About USC, the NCAA penalizes a school if the violations are so vast and numerous, and openly known, that it is obvious that a school should have known. That rule is in effect to prevent the "did not know/looking the other away" defense of violations.
From the following article:
http://rivals.yahoo.com/ncaa/football/news?slug=ys-uscpenalties061010"The report indicates that Bush and Mayo were able to engage in rule-breaking at least in part because of USC’s negligence, which included lack of staffing in the area of compliance, lax regulation on the sidelines and in the locker room, and, in at least one instance, a rebuke of running backs coach Todd McNair, who the NCAA cited for lying during the investigation." For instance, it was widely known that agents were often in the locker room, or on the sidelines with special passes during games.
In other words, USC had things purposely set up in a way that made it difficult to find out about violations, meaning that they were looking the other way with regard to certain obvious activities. Given all of the publicity about violations at other schools, USC knew that it should monitor things more closely, but failed to do so.
Meanwhile, USC's athletic program benefited tremendously from Bush's and Mayo's participation within the football and basketball programs respectively. Don't you think that if high school athletes know about houses, cars, and huge monetary payments to players, that many of them would look to go to that school so they could receive the same improper benefits?
Here is what they found, among other findings:
"Among the report’s findings concerning Bush, the NCAA detailed 18 specific instances of violations by the running back and his family. Based largely on the relationship with several marketing agents, the violations included multiple cash payments, a house for Bush’s parents, an automobile outfitted with rims and a stereo system, airfare, hotel stays, limousine service, meals, auto repairs, clothing, furniture and appliances.
"The NCAA detailed at least 12 instances of violations by Mayo, based on his relationship with a runner for a sports agency. Those violations included the receipt of cash, airfare, meals, training sessions, merchandise, wireless phones, the payment of phone bills, a television and other gifts and favors."
Again, if a school purposely has weak compliance and looks the other way, it helps them to recruit superior players. Their violations constituted a lot more than ".......an agent, who wasn't even connected to the school in any way, gave a player and his parents some improper financial benefits".
As for this comment: "The school was not told and had no idea, but they were still punished severely......", as stated before, they purposely set up their system to make it easy to use the excuse that they did not know. That is why the NCAA penalizes institutions if it is obvious that they purposely looked the other way and/or if things were set up in a way that made it difficult to spot the infractions.
My school, the University of Florida, was penalized severely for these types of violations in the eighties, and as a result, they have a very active, almost paranoid system in place to do all they can to prevent the infractions. They even have an ongoing marketing program aimed at alumni, centered around the proposition that alums should call the athletic department and "ask before you act" if there is even the tiniest question of propriety. I once employed a kid who was being recruited by the Gators, and through cross referencing, they found out that the owner of the business (me) was associated with the university. Their compliance officer actually called me up to check, and they were not satisfied until they investigated and realized that he had been working for me prior to his recruitment, and they found out that he did his job and got paid just like all my other employees. In the early nineties, one of UF's best defensive players showed up in the fall with a bright new car. When he could not prove that he or his family had paid for it, he was permanently dismissed from the team, and he then entered a supplemental NFL draft that exists due to that type of situation.
If USC had a strong compliance program in place like UF's, meaning that it was obvious that the school did everything they could to prevent and expose cheating, they would not have been seriously penalized. Plenty of schools find out about violations via their active compliance programs, then self report to the NCAA, and avoid serious penalties.