The U.S. creator of the once-popular Beanie Babies stuffed animals has agreed to plead guilty to tax evasion and pay more than $53 million for hiding assets in secret Swiss bank accounts.
Ty Warner, a 69-year-old billionaire from Chicago, faces up to five years in prison, in addition to the financial penalty.
In one of the largest cases involving hidden offshore assets, U.S. prosecutors allege that as sales of the small, cuddly toys soared in the mid-1990s, Warner sent profits to a secret account at the Swiss banking giant UBS. By 2002, authorities said he had $94 million at UBS and later moved it to another Swiss bank to conceal his holdings.
The Justice Department said Warner should have paid taxes of nearly $900,000 on about $3 million in interest income earned in the secret account.
U.S. authorities are in the midst of a crackdown on taxpayers hiding money in offshore accounts. In the last several years, more than 80 taxpayers have faced criminal charges. In addition, more than 38,000 have voluntarily disclosed their offshore accounts and paid penalties, but avoided prosecution.
American parents and their young children often waited for hours in long lines to buy the latest Beanie Babies produced by Warner's company. Some buyers then resold the dolls for substantially more than the usual retail price of less than $10, but the popularity of the toys has since waned.
Some information for this report was provided by AP.