Backpage CEO pleads guilty to conspiracy, money laundering

Sex website CEO pleads guilty in Sacramento to money laundering in Backpage case | The Sacramento Bee

In the Arizona plea, Ferrer acknowledged knowing that a great majority of Backpage.com's ads were for sex services.

Michael Lacey, who was charged along with six others in a 93-count indictment this week following the seizure and removal from the internet of Backpage.com, a classified listing website, and affiliated websites, remained in custody following a detention hearing in US District Court in Arizona.

The state Attorney General's Office said Thursday that Ferrer will cooperate with prosecutors in the case against Larkin and Lacey, which will continue in Sacramento Superior Court.

Four employees and the site's founders pleaded not guilty to the federal charges.

Backpage the company also pleaded guilty to human trafficking in Texas.

A two-year Senate investigation into online sex trafficking revealed the Backpage.com deliberately aided criminal sex trafficking of women and underage girls.

The guilty pleas by the company and CEO Carl Ferrer were made on April 5, but were unsealed late Thursday afternoon.

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The conviction in the Texas criminal court comes just days after the Department of Justice seized the website and indicted founders Michael Lacey, 69, and James Larkin, 68. But that case was dismissed in 2016 after a judge found that the defendants were protected by the federal Communications Decency Act, which provides immunity against charges for speech created on a website by third parties - in this case, the ads on backpage.com.

The plea agreement provides that, if Ferrer fails to comply with either of these requirements, the plea agreement shall be null and void and the United States may bring additional charges against Ferrer.

Ferrer could face up to five years in prison and a $250,000 fine in the federal case in Arizona, while Backpage.com could face a maximum fine of $500,000 for its money laundering conspiracy plea in the Arizona case. The state attorney general's office, which is prosecuting the case, alleges that Backpage's operators illegally funneled almost $45 million through multiple companies and created websites to get around banks that refused to process their transactions.

In his admission statement, Ferrer admitted that he conspired with other Backpage officials to facilitate prostitution crimes being committed by users of the site.

State prosecutors changed tack past year, filing almost 40 new money laundering charges against Ferrer, Larkin and Lacey. He called Ferrer's plea "a game-changer in combatting human trafficking in California, indeed worldwide". He said Ferrer's cooperation in the ongoing investigation into Dallas-based Backpage "could lead to other criminal charges" being filed against the company's associates.

As the largest online sex trafficking marketplace in the world, Backpage facilitated the sex trafficking of innocent women and children through sites it ran for 943 locations in 97 countries and 17 languages.

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