Backpage.com CEO pleads guilty to facilitating prostitution, agrees to testify for the prosecution

(Image credit: AFP/Getty Images)

published 13 April 2018

On Thursday, a federal judge in Arizona unsealed an April 5 plea agreement in which Backpage.com CEO Carl Ferrer admits to charges of facilitating prostitution and money laundering, and Ferrer also pleaded guilty to California state charges of conspiracy and money laundering. As part of the plea deals, Ferrer agreed to testify against former colleagues at Backpage, which the FBI seized and shut down on April 6, calling it a lucrative nationwide "online brothel." Also Thursday, Texas Attorney General Ken Paxton said that the company, headquartered in Dallas, has pleaded guilty to money laundering conspiracy.

"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," Attorney General Jeff Sessions said in a statement. "But this illegality stops right now." California Attorney General Xavier Becerra called the plea deal "a game changer in combating human trafficking" and "modern-day slavery" in California and worldwide.

Backpage founders Michael Lacey, 69, and James Larkin, 68, have pleaded not guilty, as have five other executives, and Lacey and Larkin are in prison in Arizona while they await a court hearing. Under the plea deals, Ferrer, 57, would spend no more than five years in prison and could pay up to $250,000 in fines. Federal prosecutors say that Backpage, founded in 2004, took over the business of running racy ads for escorts, massages, and other services after Craigslist shut down its adult section under pressure in 2010. Backpage officials say they tried to remove ads for things like prostitution and underage sex trafficking from their site.