The “Good Ship” Backpage.com and its few remaining crew are sailing into an uncertain future, still barely afloat and leaking water, with a federal trial winding down for its one-time owner, Michael Lacey, and four executives facing charges of facilitating prostitution and money laundering.
If it sinks, all the way down, some could be looking at life sentences.
Either way, Backpage.com is history, its days of providing a forum for purveyors of sex, with adults and children, gone forever.
The defendants hold fast to their company, refusing plea bargain deals offered by federal prosecutors. As a result, Scott Spear, a former executive vice president; John “Jed” Brunst, the former chief financial officer; Andrew Padilla, the operations manager; and Joye Vaught, the assistant operations manager, remain on trial along with Lacey.
It seems like there truly is honor among thieves–but not all of them.
The government shut down Backpage in 2018 and found rats willing to cut deals to testify against Backpage.com’s owners in return for lighter sentences.
As always, when a boat is in trouble, the rats start fleeing, and it has been true at Backpage.com.
The rats were happy to stay aboard and draw fat salaries when the lucrative classified ad service was bringing in some $500 million over the 14 years of its existence. But when things went sour, they bailed
Former Backpage.com CEO Carl Ferrer took a plea deal in 2018 and turned against his former employers, Lacey and the late Jim Larkin, who committed suicide before the trial began. Ferrer pled guilty to one count of conspiracy to facilitate prostitution and three counts of money laundering, which could get him five years in prison but likely will not, thanks to his willing and enthusiastic cooperation.
Larkin and Lacey saw their possessions seized by the federal government as income from criminal activities. In return for testifying against the owners and employees of Backpage.com, though, Ferrer got to keep his house, his car and some cash.
The second rat to jump ship was Dan Hyer, former marketing and sales director of Backpage.com. Hyer, like Ferrer, faces a maximum fine of $250,000 and up to five years in prison for his conviction. Prosecutors agreed to dismiss 50 charges of facilitating prostitution and 17 money laundering charges.
Hyer testified against his former employer and colleagues, explaining from the witness stand that Backpage.com was designed to compete with Craigslist.org, another online service that advertised prostitutes. After Craigslist.org took down its adult advertising section in response to protests, Backpage.com became the country’s largest online sex ad website and its profits exploded.
The plea bargains were a sweet deal for federal prosecutors. They now had two witnesses familiar with the details of the inner workings of the website and willing to testify to how it all went down. Ferrer testified that Backpage.com ads were for prostitution and that all the defendants were well aware of it.
Ferrer and Hyer were well motivated in their testimony. Defense attorney Paul Cambria said “They were testifying with prison bars rattling in their ears.” Bruce Feder, representing Scott Spear, told the jury that both Ferrer and Hyer were “singing for their supper.”
By far, however, the biggest rat to flee the Backpage.com ship wasn’t charged, didn’t testify, wasn’t in the courtroom, and wasn’t even in Phoenix. That is full-time antireligious bigot Tony Ortega—definitely King Rat Number Three.
Ortega stridently and vigorously defended Backpage.com when he was editor at The Village Voice. Backpage.com supported the entire Village Voice Media operation, including his newspaper and his salary.
“The First Amendment was shouted down in the name of children,” Ortega wrote. “Having run off Craigslist, reformers, the devout, and the government-funded have turned their guns upon Village Voice Media.”
He asserted, “The whole point of Backpage.com is that we aren’t involved after two consenting adults find each other through the community bulletin board.”
The website, he said, “exists solely so that people can freely express themselves, sometimes in ways that make other people uncomfortable”—a mild statement when the subject is children being advertised for prostitution.
He ranted on until it all started to unravel under the pressure of authorities and protesters. One of Backpage.com’s most vocal critics was the Church of Scientology. By threatening his paycheck, the Church drew Ortega’s vitriol, and he began an assault on the Church that continues to this day.
In September 2012, Ortega was fired from Village Voice Media, reportedly with two years’ salary payoff for his silence. After 17 years of employment with Larkin and Lacey, his obsession had begun to interfere with his job, and he was dumped. He hasn’t worked as a journalist since.
He could have written reams in his blog in support of Lacey and the other defendants, but he wrote not a word. His silence speaks volumes. Perhaps he hoped to avoid the knock of a federal prosecutor on his door.
The tribulations of his former employers and colleagues—possible life sentences—don’t mean a thing to King Rat Tony Ortega. The case will go to the jury soon, and then the rats will find out how far it is to the bottom.