Former PhoenixNew Times owners Michael Lacey and James Larkin have been charged in California with conspiracy to commit pimping in connection with their controlling interest in the Backpage adult classified ad portal, and warrants have been issued for their arrests.
State agents in Texas, meanwhile, raided the Dallas headquarters of Backpage and arrested Chief Executive Officer Carl Ferrer following allegations that adult and child sex-trafficking victims had been forced into prostitution through escort ads posted on the site.
Ferrer, 55, was arrested on a California warrant after arriving at Houston’s Bush Intercontinental Airport on a flight from Amsterdam, said Texas Attorney General Ken Paxton. In a statement, Paxton said agents from his Law Enforcement Unit participated in a search of Backpage headquarters and Ferrer’s arrest.
Lacey and Larkin could not be reached for comment Thursday. A representative of the California attorney general's officesaid only that the two were "not yet in custody" late Thursday.Local law-enforcement agencies could not immediatelyconfirm whether they planned to pursue any arrests.
Arpaio's $2 million 'portrait' of Lacey benefits ASU
Under California’s law, felony pimping is defined as making money offprostitutes or soliciting customers for prostitution.
“Making money off the backs of innocent human beings by allowing them to be exploited for modern-day slavery is not acceptable in Texas. I intend to use every resource my office has to make sure those who profit from the exploitation and trafficking of persons are held accountable to the fullest extent of the law,” Paxton, a Republican, said in a statement.
California Attorney General Kamala Harris said Ferrer was arrested on felony charges of pimping a minor, pimping, and conspiracy to commit pimping. He is being held in lieu of $500,000 bond and will face an extradition hearing before he can be returned to California.
Harris said in a statement that the site’s ads for “escort services” essentially make it an online brothel that generates millions of dollars from the illegal sex trade.
“Raking in millions of dollars from the trafficking and exploitation of vulnerable victims is outrageous, despicable and illegal,” said Harris, a Democrat who is running for the U.S. Senate in next month’s election. “Backpage and its executives purposefully and unlawfully designed Backpage to be the world’s top online brothel.”
An attorney representing Backpage, Liz McDougall, did not immediately respond to a telephone message left by the Associated Press.
The site advertises a wide range of services, but the California arrest warrant alleges that internal business records show that 99 percent its revenue came from its adult services section between January 2013 and March 2015. California officials said the site collects fees from users who use coded language and nearly nude photos to offer sex for money.
The site operates in hundreds of cities worldwide, authorities said, including more than 30 in California. It collected $2.5 million per month just from California, or more than $51 million during the 29 months covered by the internal revenue reports.
Authorities said the state’s three-year investigation found many of the ads include victims of sex trafficking including children under the age of 18.
The department said the investigation was prompted in part by the National Center for Missing and Exploited Children, which reported 2,900 instances to California authorities since 2012 when suspected child sex trafficking occurred via Backpage.
State agents posted escort ads online and met with those who posted to confirm that the communications were to arrange for commercial sex.
Backpage has been the subject of recent Senate hearings into its classified ads, which often promote escort services. Last month, the Supreme Court refused to block a Senate subpoena seeking information on how Backpage screens ads for possible sex trafficking.
Lacey and Larkin originally built a small empire of alternative newspapers across the country.In 1977, the two bought out the other owners of the Phoenix New Times and began it anew with Lacey as editor and Larkin as publisher. In 1983, they acquired Westword in Denver, and over the next 15 years, added papers in Miami, Dallas, Houston, San Francisco and Los Angeles. In 2005, they bought the parent company of the venerable Village Voicein New York.
Lacey and Larkin were also the subjects of a late-night raid and arrest in 2007 in what was widely viewed as a politically motivated arrest by Sheriff Joe Arpaio’s deputies after the New Times published details of a grand-jury matter. They sued and received a $3.75 million settlement from Maricopa County in 2013.
The pairdonated $2 million of that to Arizona State University’s Walter Cronkite School of Journalismand Mass Communication, though the university said the gift was later returned. The donation of money from the settlement was"in no way connected to any company that the donors have owned, including backpage.com," the university said in a statement. "Opinions diverged about its implementation and it was agreed that the donation would be returned."
In September 2012, Lacey and co-owner Larkin agreed to sell their newspaper company to a newly created company owned by a group of the papers' editors and publishers.
The men retained their interest in Backpage, a site they had founded in 2004.
Dominique Roe-Sepowitz, an associate professor at Arizona State University, has tracked ads on the Backpage website and, working with law enforcement, has confirmed that underage girls were being advertised. She said that the overwhelming number of the 200 confirmed ads featuring girls she found were from Backpage.
She saidduring a phone interview on Thursday night that "finding the Web-based platform for thetrafficking of human beings responsible for that trafficking is an important step for us to stop this problem."
Roe-Sepowitz, the director of the university's office of sex-trafficking intervention research,said the website used mechanisms that purported to ensure that women in the ads were over 18. For example, she said, people creating ads could not choose to display an age under 18.
"But the mechanisms they put in to protect themselves were incredibly permeable," she said.
Roe-Sepowitz said that three years ago, she and a Phoenix Police Department commander met with an attorney for Backpage and suggested changes that could ensure underage women were not being advertised, but to no avail.
What 'sex trafficking' really means
Kathleen Winn, the co-chair of the Arizona Anti-Trafficking Network, said she became involved in the issue in 2011 while working in the community-outreach office of the Arizona Attorney General’s Office.
Winn said a group of activistsled by Cindy McCain, wife of U.S. Sen. John McCain, succeeded in changing Arizona law in 2014 to crack down on online advertising of girls for sex, a law she said was targeted at Backpage.
Winn said it was telling that the two men sold New Times, the journalism enterprise that started their business, but kept Backpage.
“They were never going to give up that cash cow,” she said. “It was too profitable.”
The Associated Press and reporters Richard Ruelas and Lindsey Collom of The Arizona Republiccontributed to this article.
Note: An earlier version of this article indicated Arizona State University had accepted a $2 million donation fromLacey and Larkin. The article has been updated with theuniversity's statement that the gift was later returned.
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