Sat, Apr 14, 2018 - Page 7 News List

Backpage.com CEO pleads guilty and will testify

‘DOMINANT MARKETPLACE’:The Web site was the main place to post ads for illicit commercial sex and for sex-trafficked children and adults, the US attorney general said

AP, SACRAMENTO, California

The chief executive of Backpage.com pleaded guilty to state and federal charges including conspiracy and money laundering, and agreed to testify in ongoing prosecutions against others at the Web site that authorities have dubbed a lucrative nationwide “online brothel,” authorities said.

“For far too long, Backpage.com existed as the dominant marketplace for illicit commercial sex, a place where sex traffickers frequently advertised children and adults alike,” US Attorney General Jeff Sessions said in a statement. “But this illegality stops right now.”

Backpage brought in US$500 million since it began in 2004, mostly though prominent risque advertising for escorts and massages, among other services and some goods for sale, federal prosecutors said.

Authorities said that the site was allegedly used often to traffic underage victims, while company officials said they tried to scrub the Web site of such ads.

Chief executive officer Carl Ferrer is to serve no more than five years in prison under a California agreement in which he pleaded guilty to one count of conspiracy and three counts of money laundering.

Also on Thursday, Texas Attorney General Ken Paxton announced that the company pleaded guilty to human trafficking.

A federal judge in Phoenix unsealed a plea deal from Thursday last week revealing that Ferrer pleaded guilty to conspiracy and that Backpage.com pleaded guilty to money laundering conspiracy.

Under his plea agreement, Ferrer agreed to make the company’s data available to law enforcement as investigations and prosecutions continue. The guilty pleas are the latest in a cascade of developments in the last week against the company founded by the former owners of the Village Voice in New York City, Michael Lacey, 69, and James Larkin, 68.

The company founders were among Backpage officials indicted by a federal grand jury in Arizona. Larkin and Ferrer did not respond to multiple telephone and e-mail messages from reporters.

The US Department of Justice seized and shut down the Web site, and Ferrer’s federal plea deal requires him to help the government seize all the company’s assets.

Ferrer could face up to five years in prison and a US$250,000 fine in the federal case in Arizona, while Backpage.com could face a maximum fine of US$500,000 for its money laundering conspiracy plea in the Arizona case.

The federal plea deal says that any prison sentence Ferrer would face would run concurrent with his five-year terms in Texas and California.

California Attorney General Xavier Becerra said in a statement announcing the plea deal that “human trafficking is modern-day slavery, and it is happening in our own backyard.”

Texas state agents raided the Dallas headquarters of Backpage and arrested Ferrer on a California warrant after he arrived at Houston’s Bush Intercontinental Airport on a flight from Amsterdam on Oct. 6, 2016. The Dutch-owned company is incorporated in Delaware, but its principal place of business is in Dallas.

Paxon called Thursday’s pleas “a significant victory in the fight against human trafficking in Texas and around the world.”

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