Backpage.com CEO and Two Shareholders Arrested for Pimping

The CEO and two of the controlling shareholders of Backpage.com, an online advertising website which is much like the well-known, Craigslist were arrested last week for profiting from prostitution officials said.

The State Attorney General, Kamala Harris said on Thursday, October 6, 2016, that Backpage and its executives were purposely using Backpage as an online brothel, using their “escort services” category to generate millions of dollars from the illegal sex trade; some involving minors. “Raking in millions of dollars from the trafficking and exploitation of vulnerable victims is outrageous, despicable and illegal,” said Attorney General Harris.

Carl Ferrer, the Chief Executive Officer (CEO) was arrested on felony charges of pimping a minor, pimping and conspiracy to commit pimping, officials said. In addition to that arrest, “controlling shareholders”, Michael Lacey and James Larkin were also criminally charged with conspiracy to commit pimping.

Although Backpage.com  offers ad space for a variety of items and services, it is clear when browsing that only certain sections grew. The arrest warrant alleged that the “vast majority” of the revenue stream was generated through the prostitution-related ads in the adult services section. Fees are collected for those posting “escort” ads many times offering sex for money using coded language, for example, “I am happy and capable of fulfilling all your needs,” and “Always play safe.”

In addition to the coded and sometimes bluntly sexually explicit ads most of the ads have nearly nude photos of those advertised. Some of the ads were verified by the California Department of Justice investigation involved victims of sex trafficking, some being under 18 years of age. Backpage.com began their online services in 2004 and grew to service hundreds of cities worldwide with over 30 cities in California. “Backpage’s internal revenue reports show that from January 2013 to March 2015, 99% of Backpage’s worldwide income was directly attributable to the “adult” section,” Department of Justice officials said. “During this 29-month period, Backpage’s self-reporting demonstrates that gross monthly income from California rose to $2.5 million per month, with over $51 million in revenue derived from California in that period.”

After seeing the income generated by the “adult” ads, Ferrer, according to the arrest warrant, created prostitution-related sites to promote Backpage adult services. These escort directories, which included EvilEmpire.com and BigCity.com were used solely for Backpage users and according to DOJ officials, enabled Ferrer and his co-conspirators to expand Backpage’s share in the online sex advertising market. These sites featured photos and contact information taken directly from the Backpage.com website.

The three-year California Department of Justice investigation was sparked by media reports, law enforcement concerns and the National Center for Missing and Exploited Children (NCMEC). These investigations included undercover operations, posting “escort” ads and arranging to meet with people who advertised in the “escort” section. During these meetings it was confirmed that commercial sex was the purpose of these ads for both buyers and sellers, officials said. The NCMEC reported 2,900 instances of suspected child sex trafficking in California, via Backpage.com since 2012.

Numerous agencies, both law enforcement and others from California, as well as other states assisted in the investigation.
Anyone who was a victim of trafficking via Backpage is encouraged to file a report with the California Department of Justice by emailing backpage@doj.ca.gov.

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