Aug. 29 (UPI) — A founder of a long-shuttered classifieds website has been sentenced following protracted litigation centered on the site’s use to advertise prostitution.
Michael Lacey, 76, was convicted by a jury in November on one count of international concealment money laundering and sentenced Wednesday by a federal judge in Phoenix to five years in prison and three years of supervised release.
Lacey was a founder of Backpage.com, a classified advertising website that prosecutors said sprung online in September 2010 when Craigslist shut down its advertising section and ran as the Internet’s leading prostitution ads forum until 2018 when it was seized by the U.S. government.
The leadership of the website was charged with nearly 100 counts in April of that year, with prosecutors alleging they earned more than $500 million through a conspiracy to try and conceal the sexual services the ads posted on their website were selling.
Prosecutors said the defendants sought to create a conspiracy of “plausible deniability” for knowingly promoting prostitution on their website through various marketing strategies.
Among their actions included entering into a linking program with an independent web forum that permitted visitors to post reviews of prostitution acts with specific women being advertised on the site, prosecutors said. They also used an automated filter as well as human moderators to remove known sex-for-money terms on their prostitution ads, the government continued.
Along with Lacey, Scott Spear, 73, and John “Jed” Brunst, 72 — two other owners of the website — were each sentenced Wednesday to 10 years in prison and three years of supervised release after being convicted on several charges of aiding in the facilitation of prostitution and money laundering.
The sentences come down after three others involved in the website, including Carl Ferrer, 57, Backpage’s CEO and its other co-founder, pleaded guilty to related charges in April 2018.
“The defendants thought they could hide their illicit proceeds by laundering the funds through shell companies in foreign countries. But they were wrong,” Principal Deputy Assistant Attorney General Nicole Argentieri, head of the Justice Department’s Criminal Division, said Wednesday in a statement.
“Their sentences should serve as a stark reminder that the Criminal Division and its law enforcement partners are committed to protecting victims and following the money to unmask those who exploit human beings for financial gain.”