DALLAS (AP) — State agents raided the Dallas headquarters of adult
classified ad portal Backpage and arrested Chief Executive Officer Carl
Ferrer on Thursday 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.
money off the backs of innocent human beings by allowing them to be
exploited for modern-day slavery is not acceptable in Texas,” Texas
Attorney General Ken Paxton, a Republican, said in a statement.
Attorney General Kamala Harris said that 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.
“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 telephone and email messages left by The Associated Press.
The site’s controlling shareholders, Michael Lacey, 68, and James
Larkin, 67, have been charged with conspiracy to commit pimping, Harris
said in a statement. Neither of them has been taken into custody by late
Thursday although warrants have been issued for their arrest. Under
California’s law, felony pimping is defined as making money off of
prostitutes or soliciting customers for prostitution.
Lacey and Larkin are former owners of the Village Voice and the
Phoenix New Times. An attorney who previously represented the two men,
Michael Manning, did not immediately respond to a telephone message from
Backpage advertises a wide range of services, but the California
arrest warrant alleges that internal business records obtained through a
search warrant 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.
Worldwide revenue from sex ads topped $3.1 million in just one week
last year, according to a court affidavit. It says Ferrer expanded
Backpage’s share of online sex marketing by creating affiliated sites
including EvilEmpire.com and BigCity.com with related content.
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.
Larkin and Lacey each received $10 million bonuses from the website
in September 2014, according to the court filing. It says Backpage was
created in 2004, but since 2014 has been owned by a Netherlands-based
company that has Ferrer as its only named partner.
California 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.
One of the advertisers, identified only as 15-year-old “E.S.,” ”was
forced into prostitution at the age of 13 by her pimp,” according to an
affidavit filed with the complaint. She used other online advertising
services until they were shut down, the court filing says, when she
turned to Backpage.
“I mean really, coming from someone my age, there is
too much access, like it’s too easy for people to get on it and post an
ad,” she told California Special Agent Brian Fichtner, according to his
California officials said their 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 using Backpage.
The criminal complaint includes allegations that five minors, three
of them including “E.S.” under age 16, paid to post advertisements on
The charges against Ferrer could bring him nearly 22 years in prison, while Larkin and Lacey face a maximum six years.
Backpage has been the subject of recent Senate hearings into its
classified ads. Last month, the Supreme Court refused to block a Senate
subpoena seeking information on how Backpage screens ads for possible
U.S. Sens. Rob Portman, R-Ohio, and Claire McCaskill, D-Missouri,
chairman and ranking member of the Permanent Subcommittee on
Investigations, issued a statement hailing the criminal charges
resulting from what they called “the scourge of online sex trafficking.”
They put the site’s estimated annual revenues at more than $150
million, calling it “a market leader in commercial sex advertising.”
Thompson reported from Sacramento, Calif. Associated Press Writer Bob Christie contributed from Phoenix.