Carl Ferrer

Carl Ferrer, the chief executive of Backpage.com whose name was conspicuously absent from an indictment of seven other Backpage officials unsealed Monday April 8 2018, has pleaded guilty in state courts in California and Texas and federal court in Arizona to charges of money laundering and conspiracy to facilitate prostitution. In addition, he agreed to testify against the men who co-founded Backpage with him, Michael Lacey and James Larkin, who remained in jail Thursday in Arizona on facilitating prostitution charges. Court records show that Ferrer, and Backpage the corporation, both pleaded guilty to money laundering in federal court in Phoenix on April 5, with the hearing and documents sealed. He then traveled to his home state of Texas this week, where state Attorney General Ken Paxton announced Thursday that Ferrer pleaded guilty to money laundering and Backpage pleaded guilty to human trafficking. On Thursday, Ferrer turned up in Sacramento, where he was first charged along with Lacey and Larkin in 2015, and again pleaded guilty to money laundering. He was then released on bond. His California plea agreement indicates prosecutors will seek no more than five years in prison, and federal prosecutors agreed that any sentence in Arizona would run concurrently to that. Court documents in Texas weren’t available, but Paxton said in a news release Ferrer would be sentenced to up to five years as well. A day after Ferrer’s first secret plea, the federal government arrested seven of Ferrer’s former colleagues, including Lacey and Larkin, and shut down Backpage’s websites in the U.S. and around the world. The indictments were unsealed Monday, and the lack of charges for Ferrer raised questions about whether he was cooperating. Lacey and Larkin founded the Phoenix New Times alternative weekly newspaper in 1970 and eventually expanded it into a chain of weeklies that included New York’s Village Voice, hiring Ferrer along the way. In 2004, Lacey, Larkin and Ferrer created Backpage as an online way to sustain a classified advertising income after Craigslist destroyed print classified ads nationwide. Eventually the trio sold the newspapers and just kept Backpage, which records obtained by the Senate investigations subcommittee found was enormously profitable. Backpage’s profits soared to more than $100 million per year in both 2013 and 2014, according to the federal indictment. Lacey and Larkin and two other co-defendants, Scott Spear and Jed Brunst, claimed that they sold Backpage in 2015 to two Dutch companies. But the new indictment alleged that Ferrer controlled those entities, that Ferrer borrowed most of the $600 million purchasing price from the four men supposedly selling Backpage, and that all five retained control of the sites in 97 countries. Earlier this week, Lacey and Larkin had hearings in which they were ordered to remain in jail pending full detention hearings next week. The other five defendants, all former top officials of Backpage, were released.