Beanie Babies Billionaire Rumbled For Tax Dodging, Faces Penalty & Prison
The creator of the Beanie Babies has been charged with tax evasion.
The creator of the Beanie Babies global stuffed toy brand, H. Ty Warner, will be found guilty of tax evasion and will be charged with a $53 million penalty, it has emerged.
H. Ty Warner, a 69 year-old billionaire who lives in Chicago, reportedly intends to plead guilty and accept the large penalty fine, according to his attorney's statement, via The Huffington Post.
Warner, with an estimate personal fortune of $2.6 billion, has been found to have failed to report income he earned in an offshore bank account, which carries grave consequences. If he is convicted, he could face a prison sentence and more penalty charges.
Court documents allege that Warner initiated and maintained a secret offshore Swiss bank account in 1996 and didn't report any of the $3.1 million he earned in gross income through the account. Warner's attorney, Gregory Scandaglia, said "This is an unfortunate situation that Mr. Warner has been trying to resolve for several years now," describing Warner's fine as "a civil penalty[...]for failure to file a Foreign Bank Account Report."
"Beanie Baby's getting a black eye," said Allen Adamson, managing director of the New York-based branding firm Landor Associates. "The well-honed image of Beanie Babies, so much a part of the lives of many children and their parents, could take a hit[...]It's so jarring because this product feels so sweet, so innocent. To find out the person behind it isn't so sweet and innocent..." lamented Adamson.
Made by Warner's company Ty Warner Inc. since 1993, the Beanie Babies brand of half-stuffed, half bean-filled novelty toys have earned their place in the hearts and memories of generations of children. The brand is adept at evolving and keeping on top of current trends, incorporating the latest cartoon characters into their designs.
Each toy is given an aptronym: a name to describe the animals personality, e.g. Snort the bull, alongside a birth date and special poem for each toy. The toys became part of a mid-nineties, early-noughties craze amongst children to collect all of the toys, with collectibles now able to fetch thousands of dollars.
Despite Warner's tax troubles, branding expert Laura Ries doubts that the legal issues with affect many people's perception of the brand: "[The brand is] not as cool as it was[...]I don't think consumers care the owner didn't pay his taxes and is in big legal trouble."