Billionaire Beanie Baby creator, citing unhappy childhood, asks for probation
BY KIM JANSSEN Federal Courts Reporter January 2, 2014 1:30PM
Beanie Baby creator Ty Warner leaving the Dirksen Federal Building after being arraigned on federal tax evasion charges on Wednesday, October 2, 2013, in Chicago. | Chandler West/For Sun-Times Media
Updated: February 4, 2014 6:23AM
Convicted tax evader and billionaire Beanie Baby creator Ty Warner says he should be spared prison because of his troubled childhood, charity work and efforts to come clean as a tax cheat.
The 69-year-old plush toy magnate faces up to 5 years behind bars when he’s sentenced later this month, but argues in court papers filed this week that he should instead get probation or be placed under house arrest.
During a tearful appearance in court late last year, Warner pleaded guilty to hiding millions of dollars from the IRS in a Swiss bank account, accepting a plea deal under which he’s agreed to pay a $53 million civil penalty and $16 million in back taxes.
Prosecutors have yet to indicate how long they think Warner should get, but Warner’s attorney Gregory J. Scandaglia, wrote in a 36-page filing this week that Warner grew up in an “unhappy family” helping care for his schizophrenic mother with little help from his dad.
Describing how Warner helped numerous friends, colleagues and attorneys and donated millions to charity as he worked himself up from a broke college student who took jobs as a busboy, bellman, valet car parker and fruit market vendor, to become a man of extreme wealth, Scandaglia wrote that Warner “emerged from an unhappy family and a youth devoid of educational advantages to become, through decades of hard work and extraordinary creativity, a self-made American success story.”
Warner took a second mortgage on his Hinsdale condo in the 1980s to start his toy business, before striking it rich when he invented the $5 Beanie Baby in the 1990s.
Scandaglia noted that the majority of defendants charged with similar crimes connected to overseas UBS accounts have been spared prison time, and that one defendant who hid even more money than Warner in a Swiss UBS account got just 5 seconds of probation from a federal judge in Florida.
Many more tax cheats who used the Swiss UBS accounts avoided prosecution under an amnesty program, which Warner was denied access to.
But prosecutors may point to the case of Skokie gravestone business owner Peter Troost, who was last year sentenced to a year behind bars for an almost identical crime involving far smaller sums.