Donna, here is what I suggest.
1. You need to attempt to find the source of the moisture. I would suggest purchasing or finding a company that has a boroscope. You could then inspect the interior of the wall to see if you have anything growing (mold or mildew). If you don’t want to go through the hassle of finding one of these, find someone that can remove some of the wall in the closet (could be a plumber) so that it can be inspected.
2. Stop the leak. (Repair pipes or showerstall, etc)
3. Remove and replace any insulation that has turned black.
4. If the smell still persists it would be helpful to treat any areas that had mildew or mold growing on them. One way to do this is with a heat treatment. This is the same method of heat treatment that is used to control termites in the southwestern portion of the United States.