Federal prosecutors have charged the creators of the website Backpage.com, one of the largest web forums for classified ads, with facilitating prostitution and conspiracy to launder money in a 93-count indictment unsealed Monday in Arizona.
Michael Lacey and Jim Larkin, along with their co-indictees face charges ranging from facilitating prostitution to money laundering.
Senate subpoenas revealed that Backpage executives were complicit in the enabling of traffickers, including some of whom went so far as to coach them on how to avoid criminal charges through editing out words like "cheerleader", "little girl", and "school girl", from their online ads.
The indictment says Backpage took in some $500 million from selling prostitution ads.
The government claimed there were internal company documents and evidence of meetings in which the defendants admitted they knew that most of the website's ads involved prostitution. Federal law enforcement authorities are in the process of seizing Backpage.com and its affiliated websites.
"These factors suggest that Lacey could easily flee the country and use the wealth he has stashed overseas to live out the remainder of his life, in a lavish style, as a fugitive", prosecutors said in a court filing, echoing a similar statement they made about Larkin.
Larry Kazan, who represents Lacey, didn't return a call seeking comment. It's not clear how that ruling by a state judge will be viewed in the federal prosecution.
"When Backpage was running adult ads, we used to get tips, but that has dropped off", Sargent Eric Quan with the San Jose Police Department's human-trafficking unit told The New York Times a year ago.
Backpage has been in legal fights for years, but mostly in civil cases filed by young women and their families. The site had argued it simply hosted the ads. The law, however, does not, protect sites from federal liability against criminal law, like child-pornography laws.
The indictment said the site contended it tried to prevent prostitution ads, but investigators determined that was not the case.
The founders are already facing money laundering charges in California. Lacey and Larkin created Backpage in Phoenix as owners of the New Times alternative weekly newspaper chain, which became Village Voice Media Holdings after Lacey and Larkin bought the iconic NY weekly. He, Lacey and Larkin did appear before the Senate Permanent Subcommittee on Investigations in 2017, but they declined to answer questions, citing the First and Fifth Amendments.
These are all malfeasances NOT protected under the Communications Decency Act - legislation that protects platforms from being prosecuted for content posted by third parties on their site - AKA the very shield Backpage has used to weasel out of many-a-lawsuit in the past. Their charges relate to federal allegations that Backpage.com promoted illegal sex trafficking alongside consensual paid encounters.