I don’t know whether there were fewer applicants this year, but their yield last year was slightly down. However, even if the number of applicants hasn’t dropped, USC is in desperate need of having their name in the headlines for a reason which wasn’t connected to a scandal.
I also think that this particular move was chosen because the most recent scandal was about how under-qualified wealthy applicants were bribing their way into USC. That is exactly the type of scandal which reminded people that USC’s nickname was “University of Spoiled Children”.