Beanie Baby founder Ty Warner, who has a net worth of $2.6 billion, recently came in at No. 209 on Forbes annual list of the richest Americans. But the Chicago-based billionaire will have to pay a $53.5 million penalty on federal tax evasion charges, prosecutors said Wednesday.
The 69-year-old billionaire allegedly failed to report income he deposited to a secret offshore account he started with Swiss bank UBS in 1996.
“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,” said Gary Shapiro, U.S. attorney for the Northern District of Illinois, in a statement.
Warner made his fortune manufacturing plush toys through Ty Inc., including the ultra-collectable Beanie Baby line.
“This is an unfortunate situation that Mr. Warner has been trying to resolve for several years now – including through an attempt to enroll in the IRS’s Offshore Voluntary Disclosure Program in 2009,” Warner's attorney said in a statement. “Mr. Warner accepts full responsibility for his actions with this plea agreement.”
Prosecutors said that in 2002, Warner earned $3.1 million in gross income through investments held in UBS, which he failed to report on his taxes.
“Regardless of wealth, everyone must pay taxes on all of their income, not just the amount they choose to report,” Shapiro added.