MIT has, predictably, become a cesspool of corruption. People called this about two decades ago.

The problems are:

1) Ambitious people are drawn to such institutions

2) There are $40B swishing around

3) Incentives align for fame and impact, but not for honesty or positive impact

Maintaining alignment would require checks-and-balances and transparency measures, which no one cared to put in. MIT -- much more so than competing schools -- relied on NDAs and non-disparage agreements to cover up scandals.

Incentive structures and market dynamics played out, as no one cared to act.

As a curiosity, MIT was not well-known to the public prior to Good Will Hunting, and did its best work while it was still a fairly niche institution, prior to 2000.

It was exceptionally well-know in specific communities (computer science, physics, electronics, etc.), and was at or near the top in most hard fields, but that didn't translate to public recognition. If you asked a random waitress or sales-person, they'd typically confuse MIT for ITT (which had ads running all the time).

For public opinion, the undisputed #1 university in the US was Harvard, followed by Yale, Stanford, and Princeton, followed by the rest of the Ivy League

For universities, public reputation follows performance by several decades.