Former USA Gymnastics CEO Steve Penny arrested in Gatlinburg

U.S. Marshals tracked down and arrested a key figure in the USA Gymnastics sex-abuse scandal to a Gatlinburg cabin Wednesday night. 

Former CEO and president of USA Gymnastics Steve Penny was arrested on a fugitive warrant accusing him of tampering with evidence related to the investigation into possible wrongdoing at the Karolyi Ranch.

Marshals and Sevier County deputies tracked Penny to a rental cabin at 933 High Mountain Way after spotting his SUV in the driveway around 8 p.m., according to the warrant. He remains in the Sevier County jail pending extradition to Walker County, Texas, where he was indicted by a grand jury Sept. 28 on a count of tampering with evidence, a third-degree felony. Penny could appear in Sevier County General Sessions Court on Nov. 1.

According to a release from David Weeks, the district attorney in Walker County, Penny ordered the removal of documents from the Karolyi Ranch after learning the Texas Rangers were investigating allegations that Larry Nassar had sexually abused gymnasts there. The records were delivered to Penny in Indianapolis, but their current whereabouts are unknown.

The third-degree felony is punishable by two to 10 years in prison.

“The removal of the documents was done for the purpose of impairing the ongoing investigation by destroying or hiding the documents,” the statement said. “The Texas Rangers and the detectives believe that those records … would have helped in their investigation of Nassar as well as assisted with the investigation of other offenses that may have occurred at the Karolyi Ranch.”

Penny was arrested while on vacation with wife and three daughters, his attorney, Edith Matthai, told USA TODAY Sports in an email. He had not known he'd been indicted, she said. 

"If Mr. Penny had any idea he was sought in Texas this would have been appropriately handled through counsel," Matthai wrote. "Mr Penny has not and would not have attempted to avoid the service of a summons. 

"Mr. Penny is confident that when all the facts are known the allegations against him will be disproven," Matthai added. 

Olympic champions Simone Biles, Aly Raisman, Gabby Douglas and McKayla Maroney are among the more than 350 young women and girls who have said Nassar molested them under the guise of medical treatment. Some of that abuse occurred at the Karolyi Ranch, the site of monthly training camps for the U.S. women’s team.

Nassar, the longtime physician for USA Gymnastics and Michigan State, is serving an effective life sentence after pleading guilty to federal child pornography charges and state sexual abuse charges.

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It’s not known when Penny ordered the removal of the documents, believed to be gymnasts' medical records. The Texas Rangers went to the ranch in November 2017 to investigate abuse claims against Nassar, which had come to light two months earlier when Rachael Denhollander contacted The Indianapolis Star, part of the USA TODAY Network. 

Rhonda Faehn, former head of the women’s program, told a Senate committee in June that a USA Gymnastics employee had been asked to retrieve the records. In written follow-up questions, Faehn said that employee, Amy White, “told me she was ordered by Steve Penny to remove the records and bring them back to Indianapolis.”

White told her the records were removed in a “large suitcase and two large boxes,” Faehn said.

Faehn said she did not have direct knowledge of the removal, when it happened or where the records are currently. In July, then-CEO Kerry Perry confirmed Faehn’s account, saying Penny told Amy White to bring back medical records from the ranch. USA Gymnastics did not log them, Perry said.

“Where those documents went from there, I don’t know,” Perry told the committee. “I was also told that there was not a sort of logging in, if you will, of those documents in the organization, but those documents were given to then-CEO Steve Penny.”

She continued, "To my knowledge, they do not exist in our custody.”

Penny was called to testify during the Senate hearing in June, but invoked his Fifth Amendment right not to answer questions so as not to incriminate himself. He is named as a defendant in federal lawsuits filed by Raisman and fellow Olympic champion  Jordyn Wieber, as well as in California state court by former gymnasts Mattie Larson and Jeanette Antolin.

Penny resigned under pressure from the U.S. Olympic Committee in March 2017 for USA Gymnastics’ handling of abuse cases. Perry resigned last month, also under pressure from the USOC.

Neither the USOC nor USA Gymnastics responded to messages from USA TODAY Sports late Wednesday seeking comment. 

Gymnasts have said Bela and Martha Karolyi created a culture of fear and intimidation in the women’s program that allowed Nassar to thrive.

Bela Karolyi was hired in late 1999 to be the first women’s national team coordinator, and Martha replaced him in 2001 and served until after the Rio Olympics in 2016. Monthly training camps were held at their ranch from 2000 until earlier this year.

The ranch is located in the heart of Sam Houston National Forest, where there was little cell phone reception or internet access. The gymnasts said Nassar took advantage of the sparse conditions and intense training environment to groom them, lending a sympathetic ear on tough days and sneaking them snacks. He also had free rein at the facility, the only adult allowed to enter their rooms.

Nassar was indicted in Walker County in June on six counts of sexual assault of a child, a second-degree felony. Also indicted was former USA Gymnastics trainer Debbie Van Horn, on one count of sexual assault.

The Karolyis were interviewed at length, but Walker County officials said they found “no corroborated evidence of criminal conduct.”

They did say at the time, however, that the investigation remained opened, and they had asked USA Gymnastics for records and documents.

“If we get other information and we gain access to records and things,” Walker County assistant district attorney Stephanie Stroud said then, “there may be other charges.”

News Sentinel staff writer Matt Lakin contributed to this story.