Steve Penny resigned as president and chief executive of USA Gymnastics on Thursday as the Olympic sports organization continued to face heavy criticism for its handling of allegations of sexual abuse against coaches and officials over the years.
Penny's resignation came a week after a rare intervention by the U.S. Olympic Committee, which recommended Penny resign to USA Gymnastics chairman Paul Parilla.
“We all care deeply about the safety of our athletes, which is fundamental to a rewarding experience at any level of gymnastics,” Penny said in a statement. “It has been heartbreaking to learn of instances of abuse and it sickens me that young athletes would be exploited in such a manner. . . . My decision to step aside as CEO is solely to support the best interests of USA Gymnastics at this time.”
USA Gymnastics' board, which just last week defended Penny as “among the strongest advocates for our athletes,” said Penny's resignation would “help USA Gymnastics face its current challenges and implement solutions to move the organization forward in promoting a safe environment for its athletes at all levels.”
As president of USA Gymnastics, Penny ran an organization that selects and trains Team USA for world championships and the Olympics, while also overseeing a grass roots domestic talent network that included more than 1,800 member clubs across the country.
Penny and USA Gymnastics, based in Indianapolis, have faced rising criticism from abuse victims and members of Congress over how the organization has handled allegations of abuse against local coaches across the country and specifically over Penny’s handling of 2015 allegations made against Larry Nassar, a former longtime Team USA physician charged with more than 20 counts of sexual assault against women and girls in Michigan.
In August, the Indianapolis Star published an investigative report based, in part, on a lawsuit filed in Georgia by a girl who had been victimized as an 11-year-old by a USA Gymnastics member coach who was convicted in 2006 of sexual exploitation of children. USA Gymnastics had received complaints in 1998 and 1999 from other club owners that the coach, Bill McCabe, had made sexually suggestive comments about children. USA Gymnastics declined to investigate the allegations, Penny and others testified in depositions because they did not come directly from a victim of the coach.
In the weeks after that story published, dozens of women contacted the Star alleging that Nassar, who also treated women and girls through his full-time position at Michigan State University, had sexually assaulted them during routine examinations. Nassar has denied the charges. In November, Nassar was arrested in Michigan on charges of sexually assaulting a child, and more than 20 charges in both state and federal court have been added since. Three former Team USA members have said Nassar assaulted them.
Penny had personally reported Nassar to the FBI in July 2015, according to a timeline released by USA Gymnastics, but that report was made five weeks after Penny first became aware of a complaint against Nassar. Sen. Dianne Feinstein (D-Calif.) has proposed federal legislation that would, among other things, require Olympic officials to report suspicions of child abuse to law enforcement immediately.
More than 60 women have sued USA Gymnastics and Michigan State alleging their negligence allowed abuse by Nassar to occur. A woman complained to Michigan State in 2014 about Nassar, but his supervisors permitted him to keep his job until last September. USA Gymnastics fired Nassar, who had been a volunteer, in 2015.
In public statements, the USOC had been largely supportive of Penny until recently. The USOC cannot force an Olympic governing body to fire a chief executive, but it can apply political pressure, and it ultimately can decertify an Olympic governing body, revoking its association with the Olympics.
The USOC’s decision to recommend Penny's resignation contrasts starkly with how the organization responded in 2010, when USA Swimming and chief executive Chuck Wielgus faced similar allegations of ignoring sex abuse complaints. The USOC did not intervene, and Wielgus kept his job.
“Today's announcement will hopefully allow USA Gymnastics to shift its attention to the future with a secure environment for its athletes and continued success in competition,” USOC board chairman Larry Probst said in a statement.
A former broadcasting executive with TBS, Penny worked for USA Cycling before joining USA Gymnastics in 1999 as a senior vice president in charge of sponsorships and marketing. He took over as chief executive in 2005.
On the national stage, his tenure was marked by great success by America’s top female gymnasts. Team USA has produced the past four all-around female gymnastics champions and won team golds at the 2012 and 2016 Olympics.
In 2015, according to the organization's most recent 990 filing with the IRS, USA Gymnastics had $23.7 million in revenue and paid Penny $628,000 in total compensation.