The Beanie Babies craze of the 1990s thrust Ty Warner into the spotlight as he dominated the children’s toy market and amassed a fortune now worth $6 billion.
His plush toy success enabled Warner to assemble a high-end real estate portfolio that included luxury hotels, social clubs and private estates, including a sprawling 6.58-acre mansion in southern California’s celebrity enclave Montecito.
But his dizzying rise to success precipitated a fall from grace, as Warner’s greed ultimately led him to stash millions in Swiss bank accounts and he was ordered to pay back more than $53 million in taxes.
And now the reclusive billionaire has become the talk of the town yet again, after falling victim to a bizarre crime that saw an Army combat veteran break into his estate and violently assault a guest.
Russell Maxwell Phay allegedly broke into Warner’s Montecito estate last week and viciously attacked 60-year-old financial services expert Linda Malek-Aslanian. She remains hospitalized and comatose after suffering a brain injury.
Warner, 80, was home during the attack but ‘not physically harmed’, with the prosecutor saying he was ‘able to escape and contact authorities’ for help. It was unclear why Malek-Alsanian was at Warner’s home but she has previously worked for the billionaire businessman.
Phay, 42, of Nevada, allegedly invaded the property, proclaimed that he owned it, and demanded everyone leave, before attacking Malek-Aslanian and barricading himself in a second-story bathroom.
He tried to evade arrest by jumping from the bathroom window, but was tackled to the ground by sheriff’s deputies and K-9 officers.
The Beanie Babies craze of the 1990s thrust Ty Warner (pictured at his San Ysidro Ranch in Montecito, circa 2005) into the spotlight as he dominated the children’s toy market and amassed a fortune now worth $6 billion
His plush toy success enabled Warner (pictured in 2003) to assemble a high-end real estate portfolio that included luxury hotels, social clubs and private estates
The reclusive billionaire was last week the victim of a bizarre crime that saw Army combat veteran Russell Maxwell Phay break into his sprawling 6.58-acre Montecito estate (pictured) last week and viciously attack one of Warner’s guests
Phay was charged with attempted murder, burglary, kidnapping, and assault. He has pleaded not guilty and remains in custody at the Santa Barbara County jail as he is not eligible for bail.
Phay entered Warner’s home with the ‘intent to commit larceny’ before holding Malek-Aslanian against her will, assaulting her and causing ‘great bodily injury’, prosecutors said in a criminal complaint.
The complaint also identified Malek-Aslanian as being ‘particularly vulnerable’.
Phay served in the military as an Army combat soldier about 20 years ago and previously claimed he was ‘trained to eliminate’ his enemies. He has a criminal record that includes assault and battery charges, as well as prison time for threatening his wife.
Officials did not identify a possible motive and Santa Barbara County District Attorney John Savrnoch says they are ‘uncertain’ why Phay targeted the Beanie Babies mogul’s home, which is neighbored by ritzy homes belonging to dozens of stars including Prince Harry and Meghan Markle.
‘It’s a big house, but of course it’s in an area with a lot of big houses,’ Savrnoch told People Magazine.
He added that authorities do not believe that Phay, whom Savrnoch branded a ‘serious danger to society’, personally knew his alleged victims.
Warner owns several properties in Montecito, including the lavish San Ysidro Ranch hotel which is regularly frequented by Hollywood A-listers and high-profile figures.
Linda Malek-Aslanian, 60, (pictured) a financial services expert who previously worked for Warner’s hotels division, remains hospitalized and comatose after suffering a brain injury in the violent attack
Russell Maxwell Phay, 42, of Nevada, (pictured in his 2018 mugshot) was charged with attempted murder, burglary, kidnapping, and assault. He has pleaded not guilty and remains in custody at the Santa Barbara County jail as he is not eligible for bail
Police responded to reports of a disturbance at Warner’s mansion in the 1000 block of Fairway Road shortly after 4.30pm Wednesday
A BearCat armored vehicle, K-9 officers and a helicopter were deployed to the estate as officers worked to establish a perimeter around the residence
Chris Pratt and Katherine Schwarzenegger were married at the property in June 2019, roughly nine years after the toy tycoon purchased the resort and made it part of Ty Warner Hotels & Resorts, LLC.
The firm also owns the nearby Four Seasons Resort The Biltmore, but the luxury five-star hotel has been closed since the Covid-19 pandemic broke out in March 2020.
The Biltmore hotel is expected to reopen this year, according to a Four Seasons press release.
In addition to hotels, Warner’s property portfolio – which extends beyond California – includes nearby private members clubs including The Montecito Club, Sandpiper Golf Club, and the Coral Casino Beach and Cabana Club.
An annual membership at Sandpiper Golf Club ranges between $500 and $1,400, depending on the facility and membership type.
Membership at Warner’s extremely exclusive Coral Casino Beach and Cabana Club is limited to just 600 people and requires a referral from an existing member.
Members pay an initiation fee of $300,000 and monthly dues of around $2,500.
The Montecito Club, which includes access to the Coral Casino Beach & Cabana Club, has membership costing around $2,500 per month – after an initiation fee of $275,000, according to The Montecito Journal.
Members living within 25 miles of the club can pay a discounted initiation fee of $3,000 and monthly dues of $175.
Warner owns several properties in Montecito, including the lavish San Ysidro Ranch hotel (pictured) which is regularly frequented by Hollywood A-listers and high-profile figures
Chris Pratt and Katherine Schwarzenegger were married at the property in June 2019, roughly nine years after the toy tycoon purchased the resort and made it part of Ty Warner Hotels & Resorts, LLC. Pictured is a dining area at the resort
Membership at Warner’s extremely exclusive Coral Casino Beach and Cabana Club (pictured) is limited to just 600 people and requires a referral from an existing member. Members pay an initiation fee of $300,000 and monthly dues of around $2,500
The 80-year-old billionaire has never married or had children, but has been publicly romantically involved with several women.
He lived in his Montecito mega-mansion with his longtime partner Kathryn Zimmie for a decade. But the pair split in 2020 with Zimmie suing him over alleged ‘emotional and physical abuse’, The New York Post reported at the time.
Zimmie was seeking half of the Montecito estate, which at the time of the complaint was worth roughly $400 million. Warner’s lawyer, at the time, denied Zimmie’s allegations, claiming that her ‘lawsuit is a money grab filled with lies’.
The toy tycoon was also romantically involved with at least two women who were previously employed by his company Ty Inc.
Patricia Roche was a partner at the company, according to a profile by Women’s Health. She is credited with helping to turn Ty Inc. into an incredibly lucrative toy company and reportedly inspired popular Beanie Baby, Patti the Platypus.
Warner also dated Faith McGowan, a divorced mother of two who worked as a lighting designer for the firm. The pair were first linked together in the 90s after Warner, whom McGowan was not a fan of, won her and her children over.
She was heavily involved in the early creation of the Beanie Babies craze and her children even helped with research and development.
McGowan and Warner separated in 2001, but are said to have stayed in contact until her death in 2013. The toy tycoon was among those who attended her funeral.
It is unclear what Warner’s relationship is with Malek-Aslanian, the financial services expert who was violently attacked at his home.
Malek-Aslanian, who according to broker records is currently employed at New York Life, previously worked for Warner’s hotels division.
The Montecito Club, (pictured) which includes access to the Coral Casino Beach & Cabana Club, with membership costing around $2,500 per month – after an initiation fee of $275,000
Members living within 25 miles of the Montecito Club (pictured) can pay a discounted initiation fee of $3,000 and monthly dues of $175
Warner was born in Chicago in 1944 and had a tough upbringing in an unhappy family. He claimed in later life that he had been ‘a youth devoid of educational advantages’.
He was sent to military school at the age of 15, before attending college in Kalamazoo, Michigan in 1962. But Warner was forced to leave his academic institution because he couldn’t afford his tuition.
He attempted to enlist in the military but was unsuccessful after being deemed unfit to serve due to hearing loss.
His mother was later diagnosed as a paranoid-schizophrenic and he helped take care of her, working odd jobs as a busboy, bellboy, and encyclopedia salesman to make ends meet.
He got his first up-close look at the toy industry during his employment at San Francisco-based Dakin, a company that produced stuffed animals and figurines.
Dakin was the market leader at the time, selling almost 70 million toys a year, and Warner was the best person they had at getting their products out the door.
But his 15-year tenure at the company ground to a halt in 1980 after his bosses learned that Warner, who wanted a bigger slice of the action, had begun creating his own line on the side.
Warner took a three-year sabbatical to Italy, where he discovered plush toys that inspired him to form his own company, Biography.com reports.
He formed Ty Inc., where he launched Beanie Babies, and first introduced prototypes at the World Toy Fair in 1993 before manufacturing began in 1994.
Warner developed Beanie Babies after taking a three-year sabbatical to Italy, where he discovered plush toys that inspired him to form his own company, Ty, Inc. He first introduced prototypes of the popular toy at the World Toy Fair in 1993 before manufacturing began in 1994
Ty Warner attends The Chef of the Century to Open His First Manhattan Restaurant, L’Atelier de Joel Robuchon at Four Seasons Hotel, New York at Four Seasons Hotel on September 8, 2005
The range began with nine original Beanie Babies including Splash the Whale, Patti the Platypus, Chocolate the Moose, Squealer the Pig, Spot the Dog, Flash the Dolphin.
Warner said until then toys were ‘stiff and hard’. He credits part of Beanie Babies’ success to the design and flexibility to ‘wave, dance, and cuddle’ at the will of their owner. The adorable little toys were small enough to be carried around.
With a $5 price tag, Beanie Babies were also affordable enough for kids to be able to buy them with pocket money.
But the key to their unrivalled success was in creating scarcity. While sales were slow initially, Warner made the inspired decision to pull back the quantities of toys on sale.
He restricted stores to only carrying 36 of each character, which resulted in customers becoming obsessed with getting their hands on them while they could.
He also carefully elected which characters to retire which spawned a resale market that saw the toys skyrocket in value.
Sales hit more than $280 million by the end of 1996 and Warner’s personal income for that year, pretax, was a whopping $90 million.
The following year, he secured a collaboration with McDonald’s which amplified the Beanie Babies mania. The fast food chain manufactured 100 million Teenie Beanie Babies for their Happy Meals.
The promotion was expected to run for five weeks, but instead lasted only two.
By 1998, more than half of America owned at least one of Warner’s creations. His pretax salary skyrocketed to $700 million, with over $1.3 billion in sales
Sweet Sasha (L) and Marvelous Malia dolls made by Beanie Baby creator, Ty Inc., are pictured at Lamont’s gift shop in Chicago on January 22, 2009. The 12-inch dolls were released as part of the company’s TyGirlz Collection and despite the resemblance, a Ty Inc. spokesperson claimed at the time that the names did not refer to then-President Barack Obama’s daughters
By 1998, more than half of America owned at least one of Warner’s creations. His pretax salary skyrocketed to $700 million, with over $1.3 billion in sales. He upgraded from his home office to operating out of a 370,000-square-foot warehouse.
But within another year, the novelty appeared to be waning. When a series of retirements were announced, resale prices stayed about the same.
Another collection of 24 new Beanie Babies was announced, flooding the market which put collectors off. In 2000, Beanies were being flogged in three for $10 bargains and began to appear in dollar stores.
Sales dropped substantially at the start of the new millennium, and in 2004 Warner’s tax return claimed losses of more than $39 million.
He’d made investments in the four years prior, purchasing hotels, and property including the Four Seasons Hotel in New York, the San Ysidro Ranch in Montecito, the Montecito Country Club and the Sandpiper Golf Course in Santa Barbara.
Warner’s success enabled him to purchase a sprawling 6.58-acre Montecito estate off Butterfly Beach where he lived from 2010 to 2020 with his former long-term partner.
By 2007, he moved onto Ty Girlz, a series of dolls with unique patterns which were connected to a website, but both were discontinued in 2013.
In September that year, Warner’s distinguished reputation was challenged when he was charged with one count of tax evasion for failing to report more than $24.4 million in income, and evading nearly $5.6 million in federal taxes from millions hid for more than a decade in a secret account at a Swiss bank.
Beanie Babies founder Ty Warner is escorted from the Dirksen US Courthouse in Chicago, Illinois, on Wednesday, October 2, 2013 after entering a guilty plea for tax evasion
The toymaker pleaded guilty, admitting that between 1996 and 2008 he opened and maintained undeclared foreign bank accounts. He said he felt ‘shame and embarrassment’ for what he had done.
Warner faced up to five years in prison, with prosecutor Michelle Petersen asking US District Judge Charles Kocoras to give Warner at least a year behind bars.
He was handed two years’ probation and complete 500 hours of community service for at least three Chicago high schools as well as pay a $100,000 fine.
Warner also paid more than $53 million in a civil penalty, representing 50 percent of the highest balance of his unreported foreign bank accounts.
His well-known philanthropic efforts, which exceed donating over $300 million to charities since the launch of Ty Inc, were considered in the judge’s decision.
Warner’s net worth is currently valued at $6 billion and he is ranked 595 on Forbes’ Billionaires list.
