CHICAGO, Sept. 19 (UPI) -- Ty Warner, the Chicago businessman who made a fortune from Beanie Babies, will pay a $53.5 million penalty for tax evasion, federal officials said Wednesday.
Warner's attorney, Gregory Scandaglia, confirmed the plea agreement, the Chicago Tribune reported. The charges involve an account Warner opened in 1996 at UBS in Zurich, Switzerland, with court documents alleging he earned almost $900,000 from the account in 2002 and did not pay taxes on it.
"The charge alleges that Warner went to great lengths to hide from his accountants and the IRS more than $3.1 million in foreign income generated in a secret Swiss account," Gary Shapiro, U.S. attorney for the Northern District of Illinois, said.
Warner, 69, founded Ty Inc. in 1986, sinking his life savings into the business and taking out a mortgage on his house. In 1993, he produced the first Beanie Babies, and the toys became a national craze.
Forbes ranked Warner as the 209th richest person in the United States in its annual list released this week, estimating his fortune at $2.6 billion.
Scandaglia said Warner had been trying for several years to settle his tax issues, including attempting to enroll in the Internal Revenue Service voluntary disclosure program. The penalty is half the balance in his Swiss account during the period when he was failing to pay taxes.
Warner is scheduled to appear before a federal judge to enter his plea Oct. 2.