PHOENIX – Two alternative newspaper publishers and others who helped found and run the lucrative classifieds site Backpage.com knew the overwhelming majority of their income came from prostitution ads, but they tried to hide it As the company raked in hundreds of millions of dollars, prosecutors alleged in opening arguments on Friday.
Michael Lacey and James Larkin, the founders of the Phoenix New Times who developed a national newspaper empire that for a time included New York’s Village Voice, and four others are accused of facilitating prostitution. The former journalists and two others are also charged with money laundering in what authorities see as a scheme to continue collecting money after banks raised concerns that the transactions facilitated illegal activities.
“These defendants knew they were prostitution ads but they didn’t shut down the website, they didn’t stop the ads from being posted on the website,” prosecutor Reginald Jones told jurors.
Jones alleged that Backpage managers hired content moderators whose job was not to remove prostitution ads but to modify them so that they weren’t so blatant. He said the website had developed a partnership with a website where customers wrote reviews of prostitutes, which generated significant traffic to Backpage.
The government closed the site in 2018.
Defense attorneys have asked Phoenix-based U.S. District Judge Susan Brnovich to declare the trial quashed. They said, among other things, that Jones failed to properly brief them on the allegations he planned to make in his opening statement and that he violated the defendants’ right to remain silent when he said they ” couldn’t deny “they knew the vast majority of Backpage’s ads were for prostitution.
Defense lawyers chose not to make an opening statement in order to prepare a written motion to quash the trial.
Lacey and Larkin said the site never allows ads of a sexual nature and uses people and automated tools to try to remove such ads. While prosecutors say the site has posted numerous ads depicting child sex trafficking victims, no one in the Arizona federal case is charged with sex trafficking or child sex trafficking.
In a statement before the trial began, Lacey and Larkin called the lawsuit against them an “epic government overrun”, maintained that the site’s content was protected by the First Amendment, and said the site was helping law enforcement agencies. order whenever there were concerns about the safety of a woman or child.
A Government Accountability Office report released in June noted that the FBI’s ability to identify victims and sex traffickers declined significantly after the government seized Backpage, as law enforcement was aware of the site and Backpage was generally responsive to requests for information.
The site’s marketing director has previously pleaded guilty to conspiring to facilitate prostitution and admitted to participating in a scheme to give prostitutes free advertising to conquer their business. Additionally, the company’s CEO, when the government shut down the site, Carl Ferrer, pleaded guilty to another federal conspiracy case in Arizona and money laundering charges in California.