PHOENIX (AP) — On Tuesday in Phoenix, two former leaders of the defunct classified website Backpage.com are set to be sentenced for their involvement in promoting prostitution through selling advertisements for sexual services.
Prosecutors have advised that both ex-CEO Carl Ferrer and ex-sales director Dan Hyer receive five years of probation in addition to restitution payments. This recommendation comes after they both admitted to conspiracy charges in 2018. The prosecutor noted that the two men had confessed to their offenses and assisted authorities by providing testimony against one of the company’s founders during a trial in 2023.
The founder of Backpage, Michael Lacey, was found guilty of one count of international money laundering concealment and was given a five-year prison sentence, along with a $3 million fine. However, he remains at liberty while appealing the decision. Chief financial officer John Brunst and executive vice president Scott Spear are both serving decade-long sentences for conspiracy and money laundering offenses.
According to prosecutors, the operators of Backpage neglected multiple warnings to cease running prostitution advertisements, including those linked to minors. They were said to have offered free ads to sex workers and encouraged partnerships with individuals in the industry to entice them to post ads on their platform.
The operators claimed they did not permit ads explicitly for sex and made attempts to eliminate such ads by having staff remove them and using automated systems. Their legal defense argued that the site’s content was protected under the First Amendment.
However, upon pleading guilty, Ferrer admitted awareness that most of Backpage’s earnings came from escort ads. He also confessed to sanitizing ads by taking out images and text that suggested prostitution and subsequently publishing the altered advertisements.
In sentencing memos, both the prosecutor and Ferrer’s attorneys say he helped shut down the site through his cooperation.
His lawyers say Ferrer provided evidence linking defendants to the criminal enterprise and testified that Backpage’s increase in revenue stemmed mostly from prostitution.
Hyer has previously participated in a scheme to give free ads to sex workers in a bid to draw them away from competitors and win over their future business.
His attorney said her client is sincerely remorseful for his actions and contributed directly to the convictions of other defendants.
Lacey’s first trial in 2021 ended in a mistrial when another judge concluded prosecutors had too many references to child sex trafficking in a case where no one faced such a charge.
Before launching Backpage, Lacey founded the Phoenix New Times weekly newspaper with James Larkin, who was charged in the case and died by suicide in 2023 just before the second trial against Backpage’s operators was scheduled to begin.
Lacey and Larkin held ownership interests in other weeklies such as The Village Voice and ultimately sold their newspapers in 2013. But they held onto Backpage, which authorities say generated $500 million in prostitution-related revenue from its inception in 2004 until 2018, when the government shut it down.
A U.S. Government Accountability Office report released in June 2021 said the FBI’s ability to identify victims and sex traffickers had decreased significantly after Backpage was seized by the government, because law enforcement was familiar with the site and Backpage was generally responsive to requests for information.
