January 21, 2014
Beanie Baby Billionaire Hopes to Dodge Prison Time for Tax Evasion
Ty Warner, the billionaire responsible for the creation of the popular Beanie Babies toy is hoping that a federal judge will show mercy and sentence him to probation rather than prison for tax evasion. The 69-year-old acknowledged that he failed to report millions of dollars of interest income from an overseas Swiss bank account as he pleaded guilty to a single count of felony tax evasion in October.
Warner was ousted by UBS as the Swiss banking giant attempted to mitigate its own criminal liability by handing over a list of 285 names involved in offshore tax evasion.
Warner agreed to pay more than $16 million in back taxes and interest, plus a $53.5 million penalty as part of his plea agreement.
“Ty fully understands the gravity of his crime and his culpability in committing it,” his attorney, Gregory J. Scandaglia, said in a sentencing memorandum. “He knew it was unlawful to evade taxes on the income from this account, and he accepts responsibility for his conduct.”
Scandaglia believes that the financial penalty was a thorough punishment and urged U.S. District Judge Charles P. Kocoras to sentence him to probation and community service rather than prison, given his age and lack of criminal history. He also asked the court to consider the $1 billion in income taxes Warner has paid in his lifetime and that he has “created thousands of jobs, including highly profitable careers for many of its early employees, some of whom rose from hourly wage jobs to become millionaires.”
“Ty is paying dearly for his mistakes and will continue to do so for the rest of his life,” Scandaglia said in the court filing. “He does not seek to diminish the gravity of his conduct, but he respectfully asks the court to consider all of the facts.”