Beanie Babies founder, H. Ty Warner is mandated to pay $53M for offshore tax evasion, according to Forbes.
Warner was the brainchild behind the creation of a generation of collectors. He created wealth for himself and others, since some of the plush stuffed animals became collector's items worth thousands. However, he did some of it in secret Swiss accounts and the IRS now stands to charge him with a $53 million fine.
Charged with tax evasion,. Warner has already said he'll plead guilty. In fact, a statement issued by Mr. Warner's lawyer, Gregory Scandaglia, indicated that a plea agreement has already been reached. Mr. Warner will plead guilty to a single count of tax evasion and will resolve all issues of taxes owed. Plus, as part of his plea agreement, he will pay a more than $53 million FBAR penalty.
Mr. Warner who ranked number 209 on Forbes 400 list is not the first Forbes 400 member to draw tax charges. Leandro Rizutto who ranked number 296, founder of Conair, had his own run in with tax crimes. Another is Igor M. Olenicoff who ranked number 184, a California real estate developer with a net worth of $2.9 billion.
According to the charging document, Mr. Warner opened a secret UBS account in 1996. In late 2002, he moved $93 million to Zürcher Kantonalbank. That account produced over $3 million of income in 2002 alone, which he failed to mention on his Form 1040. He even amended his 2002 return in 2007, but once again omitted the offshore income
Mr. Warner still paid considerable tax on the nearly $50 million of 2002 income he did report. But he shorted the IRS by about $1.2 million. All these years later, that's a painful omission, not only drawing the tax evasion charge but huge FBAR penalties too.
