Michael Lacey and Jim Larkin, who built a nationwide media empire out of the alternative weekly newspaper PhoenixNew Times,turned themselves in to authorities in Californiaon Monday, facing charges they profited from the prostitution business through ads on their Backpage website.
The California Department of Justice issued a warrant for the arrest of Lacey and Larkin on Thursday. The two men are charged with conspiring to commit the crime of pimping, according to the criminal complaint.
The men turned themselves intothe sheriff's department of Sacramento County late Monday afternoon andwere booked into the county'smainjail, according to Kristin Ford, deputy communications director for the California Department of Justice.
According to the county's jail website, both men were being held without bail.
Lacey and Larkinareaccused of profiting from a classified advertising website that was a thinly-disguised online brothel.
Liz McDougall, an attorney for the website, said Monday she had no comment on the arrest. She had previously called the action against the company“an election-year stunt, not a good faith action by law enforcement.”
Agents in Texas raided the Dallas offices of Backpage on Thursday and also arrested CEO Carl Ferrer in the Houston airport as he returned from a trip to Amsterdam.
In announcing Ferrer's arrest and the warrants for Lacey and Larkin, authorities in California accused the menof knowingly running their business in a way that promoted and facilitated prostitution. Lacey and Larkin lost any claim to deniability, according to authorities, because law enforcement had told them repeatedly that their site was used for prostitution, some involving girls.
According to documents filed to justify the arrest warrant, an investigator said that Backpage derived at least 90 percent of its revenue from adult ads, mostly female escorts. The website was making between $1.5 million and $2.5 million each month.
Lacey and Larkin received regular bonuses from the company, the declaration reads, including one for $10 millionin September2014.
Backpage allows users to post all manner of classified ads, but it becamedominated by adultads, including those advertising escort services.
As part of the California investigation, according to the court papers, an agent placed an ad offering escort services and another ad offering a sofa for sale. The escort ad resulted in hundreds of calls and texts; the sofa received only one query.
In 2012, Lacey and Larkin sold off the newspapers and made Backpage its own company,. The two had controlling interest in the new company. Lacey said the two did soin part, because it was difficult to run the news operations while fighting the legal troubles of Backpage.
The website had become the target of legal action and protests in several states because users had illicitly posted ads to market prostitution.
"I was dealing with those issues when I should have been dealing with journalism," Lacey told The Arizona Republic in 2012, disclosing the sale.
The pressure on Backpage came as the issue gained political traction.
Activists were able to redefine prostitution, which had been seen as a nuisance crime, as an epidemic under the term, sex trafficking. Activists warned that girls were being lured into prostitution and that adult prostitutes should also be seen as victims, as they were likely lured into prostitution as girls.
Law enforcement would conduct undercover stings, luring men into hotel rooms, often by posting fake ads on the Backpage website.
Attorney for Backpage calls raid, charges against owners a stunt
McDougall had argued beforea state task force on sex trafficking that the website provided a benefit to law enforcement by providing a place where law enforcement could investigate trafficking and sexual predators. If the site closed its adult ads, McDougall argued, such traffic might move overseas, away from U.S. jurisdiction.
Ferrer is facing10 counts associated with felony pimping, five of whichinvolved minors, authorities allege.
Lacey and Larkin are each charged withone count of conspiring to commit acts of pimping.The crime carries a maximum prison sentence ofeight years.
The criminal complaint was signed by California Attorney GeneralKamala Harris,whois running as a Democrat for a U.S. Senate seat, the first open Senate seat in California in decades.
Lacey and Larkin were jailed at the same time in October2007, though the chargesof obstruction of justicewere later dropped.
New Timesengaged in a legal feud with Maricopa County Sheriff Joe Arpaio after printing his home address on the newspaper’s cover and on its website, the latter a violation of state statute.
A grand jury subpoena asked New Times for information on visitors to its website. Lacey and Larkin balked at the move and wrote a story disclosing the subpoena, a violation of the law. The two were arrested at their homes by sheriff’s deputiesbut later released.
The two sued and received a $3.75 million settlement from Maricopa County in 2013.
Montini: Rebels, entrepreneurs, victims, icons, philanthropists … pimps?
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