The owners of the classified advertising site Back. Prosecutors contend some of the advertisements depicted children who authorities said were sex trafficking victims.
The charges against Back. Their attorneys did not return phone calls seeking comment.
Five other company officials were also named in the federal indictment unsealed Monday, which charged that Lacey, Larkin and the others knowingly facilitated prostitution by running for sexual services and used foreign banks to hide revenues. The indictment said the site contended it tried to prevent prostitutionbut investigators determined that was not the case.
Photos and words that were indicative of prostitution were removed before such were run, according to the indictment. Last year, the website's chief executive Carl Ferrer, Lacey and Larkin were charged with pimping conspiracy and other charges in a case brought by state prosecutors in California.
But those charges were dismissed after a judge ruled in August that anything to do with the site's online publishing was protected by a federal law that grants immunity to websites that post content created by others. It's not clear how that ruling by a state judge will be viewed in the federal prosecution.
In any case, the judge also allowed the state of California to continue with 25 money laundering charges against Ferrer, Lacey and Larkin. The three have pleaded not guilty to the state charges.
The indictment Monday said it was implausible for Back. The indictment alleges Back. Prosecutors said the site routed proceeds through unrelated entities, wire money into foreign banks and convert money into cryptocurrency.
Executive vice president Scott Spear was charged with facilitating prostitution and money laundering, while chief financial officer John Brunst was charged with money laundering. Sales and marketing director Dan Hyer, operations manager Andrew Padilla and assistant operations manager Joye Vaught also were charged with facilitating prostitution. The indictment alleged that Padilla threatened to fire any employee who acknowledged in writing that the escorts depicted in were actually prostitutes.
Attorney Michael Piccarreta, who represents Padilla, said the case will be important in deciding whether a web host can be held responsible for a third party's behavior. Michael Kimerer, a lawyer for Brunst, and Stephen Weiss, an attorney for Vaught, didn't return a call for comment.
There were no lawyers listed in court records for Hyer. The indictment says Lacey and Larkin purportedly sold their interest in Back. Lacey and Larkin were arrested in Arizona by then-Sheriff Joe Arpaio's office in for publishing information about a secret grand jury subpoena demanding information on its stories and online readers.
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