Society

Billionaire Beanie Baby Owner Ty Warner Convicted Of Tax Evasion

| by Jonathan Wolfe

Beanie Babies. They’re fun, lovable stuffed animals that children have adored for years. The man who owns Beanie Babies, on the other hand, is now a convicted tax-evading criminal.

Billionaire Ty Warner was found guilty recently of shielding over $100 million from taxes by hiding it in a Swiss bank. An investigation focused on him by the IRS was the latest of many as the US government attempts to crackdown on the widespread practice of the rich evading taxes via Swiss Bank accounts.

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In the IRS investigation, Warner was found guilty of a number of tax evading charges. In 1996, he transferred $93.6 million to the small Swiss bank Zuercher Kantonalbank. He filed a false income statement in 2002 claiming $49.1 million in earnings while omitting an additional $3.2 million he made on the side.

He failed to fill out a Report of Foreign Bank and Financial Account form in 2002. In 2007 he filled out a form, but conveniently understated his tax by $885,300. In total, he admitted to understating his income by up to $24.4 million from 1999-2007.

Warner’s legal team is now asking the presiding judge over his case to give him probation, not prison time, for his crimes. His lawyers argue that “dozens of individuals who engaged in the exact same conduct with respect to undisclosed overseas accounts” were given probation rather than prison time.

“This case concerns an isolated event in Ty’s otherwise law-abiding life, during which he has paid approximately $1 billion in taxes,” his attorney states. “There is no reason to believe prison time is necessary to prevent him from engaging in tax evasion again.”

Warner’s request was filed on December 31. He will be sentenced on January 14. As of right now, he is facing 46-57 months in prison for his crimes. In addition to his sentencing, Warner must pay a $53.6 million penalty to the IRS with an additional $16 million in interest.

Sources: Financial Post, Chicago Tribune