Former CEO of doesn’t hold back in testimony: ‘They were prostitution ads’

A key witness in the government’s second trial targeting didn’t hold back when he told jurors that a co-owner and operators of the now-defunct site knew they were promoting the sex trade.

“They were prostitution ads,” former CEO Carl Ferrer said during the first day of testimony Tuesday, according to Courthouse News.

Asked whom the ads were targeting, Ferrer, who has pleaded guilty to conspiracy, also said: “Johns.”

After a high-profile mistrial in 2021, Michael Lacey, a co-founder of the notorious classified website, and four former employees find themselves in federal prosecutors’ crosshairs once again this month. They face almost 100 felony charges, including facilitating prostitution, money laundering and conspiracy.

Lacey and James Larkin, who died by suicide in July, founded in 2004 as a competitor to Craigslist. The government says the site “earned more than $500 million in prostitution-related revenue ” before federal authorities seized it in 2018, weeks before passage of the FOSTA-SESTA bill, which modified the country’s sex trafficking laws to include penalties for facilitation.

Exactly two years ago Thursday, a judge decided prosecutors had improperly referred to child sex trafficking too often when none of the defendants faced related charges, although the government did accuse the site of advertising the rape of children.

Now, for the second time, Lacey, Executive VP Scott Spear, CFO John “Jed” Brunst, operations manager Andrew Padilla and assistant operations manager Joye Vaught could all end up in prison. (Larkin was a co-defendant before he died by suicide on July 31.)

“Based on the facts we know, it appears the government has them dead to rights.”

Derek Bambauer, professor of internet law at the University of Florida

If prosecutors can show that the defendants knew the nature of the material going on their site or, worse, had roles in designing ads for customers, the government could ultimately win, said Derek Bambauer, who teaches internet law at the University of Florida.

“The fact they appear to have been really closely involved in the tailoring of the ads and they knew they were appealing to this particular sector, then they’re going to have a difficult time,” said Bambauer, who formerly taught in Arizona, where Backpage was based. “Based on the facts we know, it appears the government has them dead to rights.”

Given the high-profile nature of the case, as well, defense attorneys have an uphill battle.

“I think it’s going to be very difficult,” Bambauer said. “It’s really going to be hard to mount a successful defense.”

But law professor Gregg Leslie, the executive director of Arizona State University’s First Amendment Clinic, still believes defense attorneys could show their clients didn’t willfully promote the sex trade.

“Their point would be we’re not running ads saying ‘Hey, I’m a prostitute; let’s meet up,'” Leslie said. “They’re just running ads for personals, connections and escort services. And if they don’t look into it and they’re not promoting an illegal business, then why should that be illegal?”

Lacey and his former employees have said they never knowingly posted ads for sex work and even worked with police to help break up operations.

Defense lawyers told jurors this week they can show their clients made sincere efforts to keep ads for sexual services off the site.

“Backpage was viewed in law enforcement as the most cooperative site,” said defense lawyer Bruce Feder, who represents Spear. “They thought they were doing good. They wanted to get abusers off their site.”

Defense lawyer Joy Bertrand, representing Vaught, said her client “battled bad apples” and kept “trashy” ads for sex work off Backpage.

Ferrer’s testimony Tuesday, however, appeared to refute that.

Lacey and Larkin were among the founders of the alternative weekly Phoenix New Times in 1970. The two went on to own other alternative weeklies, most notably The Village Voice in New York City, before they sold their newspaper interests in 2013.

But the pair kept Backpage and repeatedly defended themselves from critics who said the site turned the other cheek to sex trafficking and child abuse.

“Backpage is part of the solution,” Lacey wrote in an internal document, according to the indictment. “For the very first time, the oldest profession in the world has transparency, record-keeping, and safeguards.”

After the site’s shutdown, sex workers did speak out about how their safety and livelihoods were negatively affected.


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