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A founder of the lucrative classified site Backpage. Jury selection for Michael Lacey and four former Backpage employees is scheduled to begin Tuesday in federal court. Their first trial ended in a mistrial in September when a judge concluded prosecutors had too many references to child sex trafficking in a case where no one faced such a charge.
Lacey had founded the Phoenix New Times weekly newspaper with James Larkin, who was charged in the case and died by suicide in July. Lacey and Larkin held ownership interests in other weeklies such as The Village Voice and ultimately sold their newspapers in In all, five former Backpage operators have pleaded not guilty to charges of facilitating prostitution. Of the five, Lacey and two others have pleaded not guilty to money laundering charges.
Additionally, the CEO of the company when the government shut the site down, Carl Ferrer, pleaded guilty to a separate federal conspiracy case in Arizona and to state money laundering charges in California. They are accused of giving free ads to prostitutes and cultivating arrangements with others who worked in the sex trade to get them to post ads with the company.
Authorities say Backpage employees would identify prostitutes through Google searches, then call and offer them a free ad. The site also is accused of having a business arrangement in which it would place ads on another site that lets customers post reviews of their experiences with prostitutes. Prosecutors said the moderation efforts by the site were aimed at concealing the true nature of the ads. In the memo, prosecutors had said witnesses testified Backpage made substantial efforts to prevent criminal conduct on its site and coordinated such efforts with law enforcement agencies.