Backpage Founders Slapped With 93 Counts In Sex Trafficking Bust

Editorial, April 8, 2018: Congress targets Backpage.com, but harming internet freedoms as well

Lacey, Larkin and five others who work for the site were indicted on federal charges in what authorities said was a scheme to knowingly facilitate prostitution by running ads for sexual services and using foreign banks to hide revenues. Although the indictment does not charge the defendants with sex trafficking crimes - sex trafficking, which involves the prostitution of children and forced prostitution of adults, is legally distinct from prostitution more generally - the official said the case was part of the government's larger efforts to combat trafficking.

The indictment also claims the website laundered some of its profits, alleging "virtually every dollar" earned by Backpage "represents the proceeds of illegal activity". An indictment accused the site of enabling child sex trafficking.

The indictment said the site contended it tried to prevent prostitution ads, but investigators determined that was not the case and that owners declined to take steps to confront the problem. It has previously seized websites suspected of facilitating prostitution, such as RentBoy.com and MyRedBook.com, and obtained convictions of the sites' operators. But prosecutors alleged that the prostitution-related ads "simply migrated to other sections of the website, where they remain to this day".

A notice that appeared Friday afternoon at Backpage.com says the websites are being seized as part of an enforcement action by the Federal Bureau of Investigation, U.S. Postal Inspection Service and the Internal Revenue Service.

Backpage.com was founded in Arizona, where it is also has banking accounts and servers, according to an official with the United States attorney's office.

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The indictment said it was implausible for Backpage.com to contend such ads were offering lawful escort services. Backpage refused the victim's father's request to remove the ads showing his deceased daughter, the indictment said.

But those charges were dismissed after a judge ruled in August that anything to do with the site's online publishing was protected by a federal law that grants immunity to websites that post content created by others. ABC15 also witnessed the Federal Bureau of Investigation agents at both Lacey's and Larkin's homes in Paradise Valley. Nicknamed "FOSTA", for the Fight Online Sex Trafficking Act, it would enable victims and state prosecutors to pursue websites in criminal and civil court without being blocked by Section 230.

According to prosecutors, the seven people charged are: Michael Lacey, 69, of Paradise Valley, Arizona; James Larkin, 68, of Paradise Valley, Arizona; Scott Spear, 67, of Scottsdale, Arizona; John E. "Jed" Brunst, 66, of Phoenix, Arizona; Daniel Hyer, 49, of Dallas, Texas; Andrew Padilla, 45, of Plano, Texas; and Jaala Joye Vaught, 37, of Addison, Texas.

But opponents of the bill noted that federal prosecutors already had the tools to pursue websites such as Backpage, and indeed the new indictment did not require the new legislation.

On Friday, the g-men swooped, and nabbed the chief executive, the chief financial officer, marketing director, the operations manager and his deputy, as well as others who had invested in the website.

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