Made $500 Million From Prostitution, Say Prosecutors

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Backpage CEO Carl Ferrer pleaded guilty to human trafficking in three states.

The CEO, in a federal plea agreement unsealed in federal court in Arizona on Thursday, admitted that during the 14 years of the site's existence, "the great majority" of Backpage's allegedly hundreds of millions of dollars in revenue came from placing illegal ads for prostitution.

Ferrer then traveled to Sacramento where he pleaded guilty to money laundering once more and was released on bond. co-founder Michael Lacey was arrested April 6 and accused of facilitating prostitution by running ads for sexual services and laundering the revenues.

A woman who waited outside during the burglary previously pleaded guilty to her role in the crime.

Law enforcement agencies, including the Federal Bureau of Investigation and Justice Department, seized Backpage's servers last week after the DOJ found the site took "consistent and concerted actions" to intentionally allow ads for illegal sex work, The Washington Post reported.

Ferrer's plea agreement also requires him to take all steps within his power to immediately shut down the Backpage website, including providing technical assistance to the United States to effectuate the shutdown, and to take all steps within his power to forfeit to the United States all corporate assets and other property owned or controlled by various Backpage-related entities.

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The most serious of the charges carries a maximum sentence of up to 20 years in prison, the official added.

Ferrer pleaded guilty to a single count of conspiracy to commit money laundering and three counts of money laundering. Magistrate Judge Bridget Bade said Thursday that attorneys have agreed on the terms of release, but other details must be ironed out. The hearing will resume Monday.

According to California Attorney General Xavier Becerra, Ferrer has agreed to assist in the prosecution of Backpage's co-founders Michael Lacey and James Larkin, shut down the site worldwide, and hand over the site's data to law enforcement. Additionally, the business pleaded guilty to human trafficking.

The company founders were among company officials indicted by a federal grand jury in Arizona, while Ferrer, 57, was noticeably absent from the indictment. Ferrer was noticeably absent from the federal indictment, which referenced a "CF" who was heavily involved with the site.

In October 2016, Attorney General Paxton's Law Enforcement Division arrested Ferrer in Houston.

"For far too long, existed as the dominant marketplace for illicit commercial sex, a place where sex traffickers frequently advertised children and adults alike", Attorney General Jeff Sessions said in a statement.

The U.S. Senate also recently approved the Stop Enabling Sex Traffickers Act (SESTA), which would remove a legal loophole that shields websites that knowingly take part in human sex trafficking from legal liability.