Two top shareholders for Backpage surrender to authorities in pimping investigation

Two top shareholders for Backpage surrender to authorities in pimping investigation
A sex worker and dominatrix, poses for photo in Los Angeles in July. She said she has posted advertisements on the classified ad website (AP photo)

The two controlling shareholders of the controversial ad website surrendered Monday to authorities, according to Kristin Ford, a spokeswoman for the California Department of Justice.

Michael Lacey and James Larkin were charged Sept. 26 with conspiracy to commit pimping in connection with their ownership of Backpage, according to a criminal complaint filed by Atty. Gen. Kamala Harris in Sacramento County Superior Court.

The two men — who once had high-profile careers shepherding alternative weekly papers like the Village Voice and Phoenix New Times — were being held in Sacramento County Jail, and a date for their arraignment had not been scheduled, Ford said late Monday.

Meanwhile, Carl Ferrer, the chief executive of Backpage, is scheduled to be arraigned Wednesday in Sacramento County Superior Court on charges of pimping, conspiracy to commit pimping and pimping minors under the age of 16. Ferrer was arrested Thursday in Houston after arriving on a flight from Amsterdam.

Advertisement bills itself as an Internet classified advertising giant where you can find apartments, cars, pets and companionship. But California prosecutors last week alleged that the vast majority of the ads are for "adult services" and that the company is profiting from the sex trafficking of adults and children.

The charges against Backpage executives come as part of a broad crackdown led by Harris. The Texas attorney general's office has joined in the criminal inquiry, and investigators raided the company's Dallas headquarters in a related probe of suspected money laundering.

Prosecutors say Lacey, 68, and Larkin, 67, helped operate Backpage and received earnings from the site, including a $10-million bonus each in 2014. Ferrer is accused of overseeing the company, including the screening of ads, and prosecutors contend he knowingly gained money from the prostitution of women and children, according to court papers.

"Raking in millions of dollars from the trafficking and exploitation of vulnerable victims is outrageous, despicable and illegal," Harris said. "Backpage and its executives purposefully and unlawfully designed Backpage to be the world's top online brothel."

Backpage on Friday denied any wrongdoing, accusing Harris' prosecution of being politically motivated as she runs for the U.S. Senate.

In a statement issued Friday, the company blasted the prosecution and noted that the charges make it clear that Backpage blocked ads that violated a prohibition against prostitution and removed ads at the request of police.

"The raid of's Dallas office and the arrest of its CEO is an election year stunt, not a good-faith action by law enforcement," according to the statement, which also was issued on behalf of Ferrer, Larkin and Lacey. The company accused Harris of an illegal prosecution, calling it a violation of First Amendment precedent as well as the Communications Decency Act.

" will take all steps necessary to end this frivolous prosecution and will pursue its full remedies under federal law against the state actors who chose to ignore the law, as it has done successfully in other cases," the statement said.

Twitter: @MattHJourno