Case Document3 Filed of 61 LODGED

 

RECEIVED COPY

MAR 2 2018
CLERK 9 DISTRICT COURT

DISTHIG OF ARIZONA
ELM DEPUTY

 

 

 

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF ARIZONA

United States of America,
Plaintiff,
V.
1. Michael Lacey
Counts 1-70, 81, 83?84, 86, 88-92

2. James Larkin .
Counts 1?68, 80, 87

3; Scott ear
Counts 1? 8,71?78, 85, 93

4. John ?Jed? Brunst"
Counts 52?70, 78-84, 86-93

5. Dan Hyer
Counts 1-68

6. Andrew Padilla
Counts 1-51

7. Jo eVaught
Coun?ig 1-51

Defendants.

 

 

 

THE GRAND JURY CHARGES:

A. Introduction

2 

INDICTMENT

V10: 18 U.S.C. 371
Conspiracy)
cunt 1

18 U.S.C. 1952(a)(3)(A) 
(Travel Act?FaC?itate Prostitution)
Counts 2?51

18 U.S.C. 1956(h) .

(Cons iracy to Commrt Money
Laun ering)

Count 52

18 U.S.C. 1956(a)(1)(B 
(Concealment Money Laiindering)
cunts 53?62 ..

18 U.S.C. 1956(a)(2)(A)
(International Promotional Money
Laundering

Counts 63? 8

18 1957(a) 
(Transactional Money Laundering)
Counts 69-93

18 U.S.C. 981, 982
21 U.S.C. 853, 28 U.S.C. 2461
(Forfeiture Allegations)

1. The website (?Backpage?) is notorious for being the

 

 






 

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internet?s leading source of prostitution advertisements. Backpage derives the
overwhelming majority of its revenue from such ads. These practices have enabled
Backpage to earn over $500 million in prostitution-related revenue since its inception.

2. Backpage was created in 2004 by defendant MICHAEL LACEY
defendant JAMES LARKIN and a third individual, C.F. From
2004?15, LACEY and LARKIN oversaw the website?s policies and strategic direction.
Additionally, LACEY and LARKIN have retained signi?cant control over the website (and
have continued receiving tens of millions of dollars of Backpage?related distributions)
since purportedly selling their interests in Backpage in 2015.

3. Defendant SCOTT SPEAR served as the Executive Vice President of one of
Backpage?s parent companies and held, at times, an ownership interest in Backpage of
approximately 

4. Defendant JOHN BRUNST served as the Chief
Financial Officer of Backpage and several of Backpage?s parent companies and held, at
times, an ownership interest in Backpage of approximately 

5. Defendant DAN HYER joined Backpage?s marketing department
in Or around 2006 and served as Backpage?s Sales and Marketing Director.

6. Defendant ANDREW PADILLA served as Backpage?s
Operations Manager.

7. Defendant OYE VAUGHT served as Backpage?s assistant
Operations Manager.

8. The defendants identi?ed above are referred to at times in this indictment as
the DEF 7

9. As explained in detail below, the BACKPAGE DEFENDANTS have utilized
a variety of strategies to make it appear that the prostitution ads appearing on Backpage
are actually ads for ?escort? services, ?adult? companionship, dating, or other lawful

activities. For example, Backpage purports to bar customers from offering illegal services

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and has periodically used computerized ?lters and human ?moderators? to edit the wording
of (or block) ads that explicitly offer sexual services in return for money. 

10. These strategies are a ?ction designed to conceal the true nature of
Backpage?s ads and customers. Indeed, the BACKPAGE DEFENDANTS have
admitted?in internal company documents and during private meetings?that they know
the overwhelming majority of the website?s ads involve prostitution. In one internal
document, LACEY actually bragged about the company?s contributions to the prostitution
industry: ?Backpage is part of the solution. Eliminating adult advertising will in no way
eliminate or even reduce the incidence of prostitution in this country. . . . For the very ?rst
time, the oldest profession in the world has transparency, record keeping and safeguards.?

ll. Notwithstanding these private admissions, the BACKPAGE
DEFENDANTS have taken'pains to mislead the public, regulators, and law enforcement

of?cials concerning the supposed sincerity of Backpage?s efforts to prevent the publication 

of prostitution?related ads. For example, after reviewing written description of
Backpage?s contributions to the prostitution industry and editing practices, LARKIN
instructed CF. to preVent ?any of the information in this being made public.? PADILLA,

. who helped supervise Backpage?s moderators, threatened to ?re any employee who

acknowledged in writing that the ?escorts? depicted in the website?s ads were actually
prostitutes: ?Leaving notes . . . implying that we?re aware of prostitution . . . is enough to
lose your job over.? And in one internal document, Backpage?s media strategy was
described simply as ?Do not acknowledge the prostitution.?

12. Many of the ads published on Backpage depicted children who were victims
of sex traf?cking. Once again, although Backpage has sought to create the perception that
it diligently attempts to prevent the publication of such ads, the reality is that Backpage has
allowed such ads to be published while declining?for ?nancial reasons?to take necessary
steps to address the problem. For example, for several years, Backpage?s of?cial policy,

when presented with an ad featuring the prostitution of a child, was to delete the particular

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words in the ad denoting the child?s age and then publish a revised version of the ad. Such
editing, of course, did nothing to change the fact the ad featured the prostitution of a child?
it only created a veneer of deniability and helped Backpage?s customers pimps
traf?cking children) evade detection. .

13. Backpage has also contributed to the proliferation of ads featuring the
prostitution of children in other ways. For example, an anti-sex traf?cking organization
once suggested that Backpage provide an automatic warning message whenever a customer
searched for particular terms indicative of the prostitution of a child. In response, C.F.
acknowledged the proposal was a good one but declined to adopt it because Backpage
would not derive any public?relations benefit from doing so: ?This is a good idea but it is
not visible to AGs [state attorneys general] so it has little PR value. It is a low priority.?
Backpage has also claimed it does everything in its power to alert the National Center for
Missing and Exploited Children whenever it becomes aware that a child is
being advertised on its website. However, the BACKPAGE DEFENDANTS implemented
policies to arti?cially limit such referrals. In one email, PADILLA instructed VAUGHT
that ?if we don?t want to blow past 500 [referrals to this month, we shouldn?t be
doing more than 16 per day.? In another training document, moderators were instructed
not to send emergency alerts to NCMEC in response to complaints ?led by the
grandparents and other extended family members of children being advertised on the
website: ?Neice [sic], nephew, grandchild, cousin, etc. doesn?t count.? I

14. Virtually every dollar ?owing into Backpage?s coffers represents the
proceeds of illegal activity. In fact, by 2015, the major credit card companies stopped
processing payments for Backpage and some banks closed'Backpage?s accounts out of
concern they were being used for illegal purposes. In response, the BACKPAGE
DEFENDANTS have pursued an array of money laundering strategies. These strategies
have included instructing customers to send checks and money orders to particular Post

Of?ce box, depositing those payments in bank accounts held in the name of entities with

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no apparent connection to Backpage, and'then giving customers a corresponding ?credit?
on Backpage to purchase new ads, wiring the proceeds of Backpage?s business to bank
accounts held in foreign countries and then redistributing the funds to certain BACKPAGE
DEFENDANTS (as compensation) or redepositing the funds in bank accounts held in the
United States (to conceal the nature of those funds and promote Backpage?s ongoing
operations), and converting customer payments, and the proceeds of Backpage?s
business, into and out of 

15. The BACKPAGE DEFENDANTS have also engaged in other ?nancial
transactions designed to conceal their misconduct and evade seizure by law enforcement.
For example, in November 2016, LACEY asked employees of an Arizona?based bank for
advice on how to move his assets ?offshore? to protect them from seizure by the
government. Soon afterward, $16.5 million in Backpage-derived cash was wired from
bank accounts in the United States to an overseas bank account in Hungary.

16. For all of these reasons, the BACKPAGE DEFENDANTS are charged in this
indictment with the crimes of facilitating prostitution (18 U.S.C. 1952), concealment,
transactional, and international promotional money laundering (l8 U.S.C. 1956 and
1957), and/or conspiracy to commit these offenses (18 U.S.C 371 and 1956).

B. Backnage?s Origins, Ownership, and Control .

17. LACEY and LARKIN are the founders of the Phoenix New Times, an
alternative newspaper based in Arizona. Over time, LACEY and LARKIN acquired
several other alternative newspapers, which they came to operate through an entity called
Village Voice Media Holdings Additionally, SPEAR served as 
Executive Vice President and BRUNST served as Chief Financial Of?cer.

18. The publications within the newspaper chain routinely featured
illegal prostitution ads. In fact, more than 30 years ago, a federal court af?rmed the
conviction of the operator of a prostitution business (which masqueraded as a massage

parlor) for publishing ads in the classified section of the Village Voice. See United States

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v. Sigalow, 812 F.2d 783 (2d Cir. 1987). The conviction was for violating l8 U.S.C.
1052, one of the same crimes charged in this indictment.

19. By 2000, the rise of the internet?and, in particular, the website
(?Craigslist?), which offered free classified ads?began to
signi?cantly disrupt business model, which depended on classi?ed advertising
revenue for survival. 1 

20. LACEY and LARKIN, with assistance from C.F., sought to address this
threat by creating Backpage. Their decision to create Backpage was later described in an
internal company document as follows: ?In 2004, in response to the Craigslist threat that
was decimating daily newspapers, VVM launched its own online classi?ed site,
Backpagecom, named after the back page of print publication.?

21. During its first few years of operation, Backpage accounted for only a
fraction of overall revenue. In January 2006, for example, VVMH estimated that
Backpage supplied only 1% of its overall advertisingrrevenue but also noted that Backpage
had ?tremendous upside potential.?

22. This prediction proved prophetic. By 2008, Backpage was generating over
$5 million in annual profit. This annual pro?t ?gure increased to over $10 million in 2009. i

23. In 2010, Craiglist chose to shut down its ?adult? section due to the prevalence
of ads for prostitution and other illegal services. The BACKPAGE DEFENDANTS,
sensing an opportunity, made an aggressive push for Backpage to capture Craiglist?s share
of this market. In one internal document, LARKIN commented: ?Craigslist has folded . .
. . It is possible that this will mean a deluge of adult content ads forbackpagecom . .
We have with the Village Voice probably the longest run of adult content advertising in
the US and it is, like it or not, in our DN 

24. This push was successful. In internal documents, Backpage stated that it
experienced ?explosive growt by ?capitalizing on displaced Craigslist ad volume.?

Backpage?s annual pro?ts grew to over $26 million in 2010, over $52 million in 2011, and



 

 






 

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over $78 million in 2012.

25. These ?gures dwarfed the profits that print publications were
generating. In fact, Backpage became so pro?table that the BACKPAGE DEFENDANTS
decided to get rid of publishing business so they could focus on Backpage?s
further development and expansion. Accordingly, in or around November 2012, the
BACKPAGE DEFENDANTS spun off print publications and began utilizing
several new corporate entities, including Medalist Holdings, Inc. (?Medalist?), Dartmoor
Holdings LLC (?Dartmoor?), and Camarillo Holdings, LLC (?Camarillo?), to serve as
Backpage?s parent companies. 1

26. Following these transactions, LACEY held an ownership interest in Medalist
(and, therefore, in Backpage) of approximately 45%, LARKIN held an ownership interest

?of approximately 43%, BRUNST held an ownership interest of approximately and

SPEAR held an ownership interest of approximately 

27. Backpage?s annual pro?ts continued to skyrocket during and after these
changes. They grew to over $112 million in 2013 and over $134 million in 2014. -

28. In or around April 2015, LACEY, LARKIN, SPEAR, and BRUNST
purported to sell their Ownership interests in Backpage and several related entities for
around $600 million to various Dutch entities. These Dutch entities included Atlantische
Bedrijven, C.V., which agreed to purchase Backpage?s U.S. operations for around $526
million, and UGC Tech Group C.V., which agreed to purchase Backpage?s overseas
operations for around $77 million.

29. In fact, these Dutch entities were controlled by CR, who borrowed most of
the $600 million from entities controlled by the sellers to ?nance the purchase. Due to this
?nancial arrangement, LACEY, LARKIN, SPEAR, and BRUNST retained a signi?cant
?nancial interest in Backpage after the transactions were completed.

30. Additionally, LACEY, LARKIN, SPEAR, and BRUNST retained signi?cant

operational control over Backpage following these transactions. For example, the April

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2015 loan agreement require-d CF. to sign a six-year employment agreement, required CF.
to provide the lenders with full access to Backpage?s books and records, required CF. to
provide the lenders with an annual listing of all of personal assets, and prohibited
C.F. from opening any new bank accounts on Backpage?s behalf without the lenders?
consent.

C. Backpage?s Knowledge And Facilitation Of Prostitution Ads

31. By 2008, if not earlier, the BACKPAGE DEFENDANTS were aware that
the overwhelming majority of the website?s ?adult? ads involved prostitution.
Nevertheless, the BACKPAGE DEFENDANTS made a financial decision to continue
displaying those ads.

32. The BACKPAGE DEFENDANTS also sought to sanitize the ads by editing
them?that is, by removing terms and pictures that were particularly indicative of
prostitution and then publishing a revised version of the ad. This process was sometimes
referred to as ?moderation.?

33. For example, in April 2008, CF. wrote an email explaining that, although he
was ?under pressure to clean up phoenix?s adult content,? he was unwilling to delete
prostitution ads because doing so ?would put us in a very uncompetitive position with
craig[slist]? and result in ?lost pageviews and reVenue.? Thus, he instructed Backpage?s
technical staff to edit the wording of such ads, by removing particular terms that were
indicative of prostitution, and then allow the remainder of the ad to be featured on
Backpage?s website.

34. On February 26, 2009, CF. received an email from the classi?ed?ads
manager of a newspaper within the VVMH chain asking why Backpage?s terms of service
purported to prevent customers from ?suggest[ing] an exchange of sexual favors for
money? in light of the fact that ?[c]learly everyone on the entire backpage network breaks
the rules.? In response, C.F. didn?t dispute the author?s characterization and explained that

Backpage had simply added the terms of service at the behest of ?our attorney in in an

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attempt to avoid liability in civil lawsuits.

35. On May 25, 2009, SPEAR received an email summarizing a plan to begin
?remov[ing] sex act pics and coded terms? from Backpage ads. Later that day, C.F.
forwarded this email to HYER with the explanatory note that ?We do not intend to be a
craig[slist] here, just get out the most egregious stuf 

36. On March 8, 2010, C.F. testi?ed in federal court (the United States District
Court for the Southern District of Florida) in the criminal trial of a pimp who had used
Backpage to post prostitution ads. During his testimony, C.F. acknowledged the defendant
had used the email address ?Youngpimpin86? when posting the ads. C.F. also
acknowledged that the ads described one so-called escort as ??ve-foot?three, with a small
waist and amazing ass you'll have to see to believe. XL, XL, XL, Lollipop? and described
a different so?called escort as ?discrete, sincere and extremely naughty. I am the type of
girl who absolutely adores a man who understands the many desires of a young beautiful
woman and how to accommodate a variety of fantasies.? This episode provided notice to
Backpage that it was implausible to pretend such ads were merely offering lawful escort
services.

37. On September 1, 2010, PADILLA sent an email to HYER and C.F. stating
that customers who engaged in ?extreme and repeat? Violations of Backpage? posting rules
would have their ads deleted and be banned from the website. However, PADILLA also
stated the bans would only be temporary and that ?we?ll do everything we can to affect
only the worst apples.?

38. On September 1, 2010, SPEAR received an email acknowledging that
Backpage?s moderators were being instructed to ?Remove any sex act pics in escorts [ads]?
and ?Remove any illegal text in escorts [ads] to include any code words for sex act for
money.?

39. On September 21, 2010, a group of state attorneys general wrote a letter to
Backpage. This letter observed that ?ads for prostitution?including ads trafficking



 

 




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children?are rampant on the site? and argued that ?[b]ecause Backpage cannot, or will
not, adequately screen these ads, it should stop accepting them altogether.? The letter
acknowledged that this step would cause Backpage to ?lose the considerable revenue
generated by the adult services ads? but stated that ?no amount of money can justify the
scourge of illegal prostitution, and the misery of the women and children who will continue
to be victimized, in the marketplace provided by backpage.?

40. On September 25, 2010, CF. wrote an email explaining that Backpage was 
unwilling to delete ads that included terms indicative of prostitution because doing so
would ?piss[] off a lot of users who will migrate elsewhere? and force Backpage to refund
those customers? fees. Thus, C.F. announced that Backpage would ?go back to having our
moderators remove bad content in a poSt . . . i

41. On September 30, 2010, CF. testi?ed in federal court (the United States
District Court for the District of Minnesota) in the criminal trial of a pimp who had used
Backpage to post prostitution ads. During his testimony, C.F. acknowledged that
Backpage?s servers are located in Arizona and that the ads posted by the Minnesota?based
defendant had therefore ?traveled across state lines.?

42. On October 8, 2010, PADILLA sent an email (on which VAUGHT was cc?d)
threatening to ?re any Backpage employee who acknowledged, in writing, that a customer
was a prostitute: ?Leaving notes on our site that imply that we?re aware of prostitution, or
in any position to de?ne it, is enough to lose your job over. . . . This isn?t open for
discussion. If you don?t agree with what I?m saying completely, you need to ?nd another
job.?

43. On October 16, 2010, PADILLA sent an email to a large group of Backpage
employees (including HYER and VAUGHT). The email had two attachments that
provided guidance on how to ?moderate? ads. The ?rst was a Powerpoint presentation that
displayed a series of 38 nude and partially-nude photographs, some of which depicted

graphic sex acts. Next to each picture was an instruction as to whether it should be

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approved or disapproved by a Backpage moderator. These instructions included ?Approve.
Nude rear shots are okay as long the model is not exposing her anus or genitalia.? and
?Approve. Rear shot okay. Transparent wet panties okay.? The second was an Excel
spreadsheet identifying 5 0 terms (all of which were indicative of prostitution) that should
be ?stripped? from ads before publication. PADILLA concluded the email by stating:
the language in ads that?s really killing us with the Attorneys General. Images are
almost an afterthought to them.?

44. On October 16, 2010, PADILLA sent a separate internal email (which also
included HYER and VAUGHT as recipients). In this email, PADILLA explained that ?I?d
like to still avoid Deleting ads when possible,? that ?we?re still allowing phrases with
nuance,? and that the case of lesser violations, editing should be sufficient.?

45. On October 25, 2010, CF. sent an email to SPEAR, HYER, and PADILLA
acknowledging that the ?[i]llegal content removed? through Backpage?s moderation
processes was ?usually money for sex act.? This email also explained that, after the ?sex
act pics are removed,? the ?ad text may stay.? A

46. On October 26, 2010, HYER and PADILLA received an email explaining:
?We will not remove ads with vaginas or penis showing, just the images unless they are a
frequent offender. We will not remove ads with rates under an hour, just the. text with the
minimum rates. Users need time to react to this change.?

47. On October 27, 2010, PADILLA sent an email to the head of a group of
contractors from India who had been hired to moderate Backpage? 3 adult ads. In this email,
PADILLA criticized the contractors for deleting too many ads, stated that this approach
was bad for business, and instructed the contractors to simply edit the ads to remove the
more-obvious language: ?As long as your crew is editing and not removing the ad entirely,
we shouldn?t upset too many users. Your crew has permission to edit out text violations
and images and then approve the ad.?

48. On October 27, 2010, HYER sent an internal email stating that Backpage

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was ?editing 70 to 80%? of the ads it received from customers. In other words, HYER
acknowledged that a large proportion of the ads originally submitted by Baokpage?s
customers contained text and pictures that were indicative of prostitution and that
Backpage was still choosing to publish those ads after editing them.

49. On November 4, 2010, CF. sent an email to Backpage?s India?based
moderators (on which PADILLA was cc?d) explaining that any of the ads need to have
15 minute and 30 minute pricing removed? and that ?I?m being evaluated by lawyers 
state attorneys general] later this week so cleaning up old stuff is important.?

50. On November 17, 2010, HYER and PADILLA received an email.
acknowledging that the term Lolita is ?code for under aged girl? but explaining that this
term could simply be stripped out from ads (as opposed to refusing to publish the ad). The
email also explained that customers should be allowed to include their identi?cation
numbers from a notorious prostitution website, The Erotic Review: ?[A]llow users to put
in TER IDs (just no live links).? 

51. On November 30, 2010, LARKIN, SPEAR, and other Backpage
representatives participated in a conference call with representatives from NCMEC.
During this call, the Backpage representatives were advised that a large portion of the ads
on Backpage were blatant prostitution ads, that many of those ads featured children, and
that the posting of such ads was illegal in every state.

52. In December 2010, HYER, PADILLA, and others exchanged a series of
emails entitled ?Deep cleaning strip out.? These emails identi?ed a list of terms
that were indicative of prostitution and discussed plans for removing the terms from the
old ads in Backpage?s archives. During this exchange, C.F. stated that Backpage wasn?t
willing to delete the old prostitution ads because ?our users love? having access them,
best to do deep cleaning and not kill a valuable feature.? C.F. later encouraged
Backpage?s staff to complete the project quickly to avoid scrutiny: ?This task is urgent

since CNN is runing [sic] a report soon.?

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53. On January 13, 2011, HYER and PADILLA received an email summarizing
instructions that had been provided to members of Backpage?s technical staff. It explained
that the technical staff had been instructed ?not to display the moderation log? in a
particular section of Backpage?s database ?since we this page for subpoenas. I would
rather not testify in court as to why my staff ?approved? . . . postings.?

54. In January 2011, LARKIN and LACEY met with a representative from

NCMEC. During this meeting, LACEY asked which types of sex ads would be acceptable

from perspective. When the NCMEC representative declined to say that any
such ads would be acceptable, LACEY made a statement to the effect of ?adult prostitution
is none of your business.?

55. On January 31, 2011, and February 1, 2011, CF. engaged in an email
exchange concerning whether to remove links to other prostitution websites (such as The
Erotic Review) from expired Backpage ads. C.F. stated that, although SPEAR and his
?internet safety guy? were recommending that such ads be removed, he thought this would
?be a stupid move? because it would hurt Backpage ?nancially (by reducing the number
of referrals from other sites). C.F. added that ?this overly zealous focus on moderation at
the expense of other development is a lot of bullshit . . . 

56. On February 2, 2011, CF. sent an email acknowledging that ?[t]he strip out
affects almost every adult ad.? In other words, C.F. acknoWledged that ?almost every adult
ad? on Backpage was a prostitution ad that had been edited to remove the most damning
text and pictures.

57. On February 3, 2011, a Backpage customer who went by the name ?LiCks

Alot? wrote an email to Backpage complaining that all of the pictures in one of her ads

(entitled ?Athletic SWF Guaranteed Low Mileage had been deleted. CF.

responded to ?Licks Alot? by explaining that one of her photos had been removed because
?[o]ur crazy internet safety experts do not want any genitalia showing up around the

thong.? However, C.F. proceeded to apologize to ?Licks Alot? over the removal of her

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remaining photos, allowed her ad (which was obviously for prostitution) to remain on the
website, and offered her a free upgrade.

58. On February 8, 2011, OF. testified in federal court (the United States District
Court for the Middle District of Florida) in the criminal trial of a pimp who had used
Backpage to post prostitution ads. During his testimony, C.F.. authenticated one of the ads
the defendant had placed on Backpage, whose title was ?Extra horny sexy newbie,?
con?rmed that Backpage had allowed this ad to be posted multiple times in various East
Coast cities, and acknowledged that Backpage published ?a lot? of similar ads. This
episode provided further notice to Backpage that it was implausible to pretend such ads
were merely offering lawful escort services.

59. On February 16, 2011, PADILLA sent an email to Backpage?s India?based
moderators (on which VAUGHT was cc?d) explaining that Backpage was adopting a
?more lenient policy? and that he was instructing his Phoenix-based employees to ?go easy
on some types of violations.? PADILLA acknowledged this approach would ?likely? result
in more ?Violations? but emphasized that ?moderators should err on the side of the user.?

60. On February 16, 2011, PADILLA sent a separate email discussing whether
several terms should remain on Backpage?s ?filtered terms? list. During this discussion,
PADILLA aCknowledged?by placing quote marks around the term ?companionship??
that he didn?t actually believe the women being advertised on Backpage were providing
lawful escort services: ?[The term] implies some exchange of bodily ?uids which kills our
?companionship? argument, but i don?t think we?ve ever really gotten in trouble for it.? 

61. On February 22, 2011, PADILLA received an email requesting Backpage?s
?list of banned, stripped out adult terms.? In response, PADILLA sent an Excel
spreadsheet entitled ?Phrase List 02211,? which PADILLA described as ?the latest greatest
version of the list.? The enclosed spreadsheet identified over 660 words or phrases that are
indicative of prostitution, including an array of terms that are suggestive of child

53 (G

prostitution ?lolita,? ?fresh,? ?high school,? ?tight, young?). The spreadsheet

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explained that most such terms were simply to be ?filtered? from the ads in which they
appeared.

62. On February 23, 2011, PADILLA received an email concerning a particular
ad that had recently been edited by Backpage?s India-based moderators. The ad was
obviously for prostitutionFits title was ?new-new?new-put me in your favorite position?

and the poster had attempted to include two photographs that violated Backpage?s posting

. rules. In response, the India?based moderators had deleted both of those photos, as well as

a third photo that depicted the prostitute?s face, and then allowed the ad to be published.
The email received by PADILLA did not criticize the moderators for allowing an obvious
prostitution ad to be published after editing. To the contrary, it emphasized that the ad
should remain on Backpage and criticized the moderators for removing the third photo,
threatening to ?re them if they did it again: out of 3 pics should have been removed.
But [the] moderator deleted all three pics. This is plain wrong . . . . I would ?re a moderator
in Phoenix if they did this.?

63.. In March 2011, LARKIN, LACEY, SPEAR, and other Backpage
representatives met with representatives from NCMEC. During this meeting, the Backpage
representatives were again advised that a large portion of the ads on Backpage were blatant
prostitution ads. The Backpage representatives also were advised they could be criminally
prosecuted under federal law for their conduct. 

64. On April 5, 2011, PADILLA sent an email whose recipients included
VAUGHT and the supervisor of Backpage?s Indian moderation team. The email was
entitled ?relaxed image standards? and included, as an attachment, a document that
displayed a series of 30 nude and partially-nude photographs. Next to each picture was an
instruction as to whether it should be approved or disapproved by a moderator. One picture
showed a woman sitting on a bed, wearing only a bra and panties, with her legs spread
open and her hand partially covering her crotch. The caption provided in part: ?okay 
but barely.?

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65. Between April 2011 and March 2012, PADILLA, C.F., and others
participated in an email exchange acknowledging that Backpage was deleting thousands of
pictures from customer ads each week and seeking assistance in collecting all of the deleted
pictures so they could be used for ?entertainment? or to generate user ?traf?c for other
projects.? The email explained that the deleted pictures could be made available to the
public on a new website called "nakedpics.backpage.com? or ?badpics.backpage.com.?

66. On April 19, 2011, LARKIN and SPEAR received an email seeking
permission to terminateithe contract of a third-party vendor that had been receiving $17,000
per month to ?remov[e] any nude pics? from the expired ads in Backpage?s database.
LARKIN responded: ?do it!? 

67. On June 7,2011, C.F. received an inquiry from a law enforcement of?cial
abOut a particular ad that included the term ?amber alert.? In response, C.F. acknowledged
this might be ?some kind of bizarre new code word for an under aged person.? C.F. then I
forwarded this exchange to PADILLA and stated that he had instructed HYER to add
?amber alert? to Backpage?s ?strip out? list. In other words, HYER, PADILLA, and CF.

did not require all future ads involving this particular coded term for the prostitution of a

child to be blocked from Backpagehthey merely required such ads to be edited before

publication.
68. On June 30, 201 1, several Backpage representatives met with representatives

from the of?ce of the Washington State Attorney General. During this meeting, the

A Backpage representatives initially attempted to claim that no prostitution ads appeared on

their website. In response, a representative from the Attorney General?s of?ce stated:
?You mean to tell me that if someone responded to an advertisement, the woman they
called for services would be offering to go out for coffee?? A Backpage representative
responded to this question by looking at C.F., laughing, and acknowledging that Backpage
couldn?t ?deny the undeniable.? 

69. On July 27, 2011, OF. sent an email to HYER and PADILLA, and a nearly?

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Case Document 3 Filed 03/28/18 Page 17 of 61

identical email to LARKIN and LACEY, concerning the possibility of using age-
veri?cation software. In this email, C.F. acknowledged the software might be bene?cial
(?This might be our solution?) but recommended against its Wholesale adoption because it
would cost ?79 to 99 cents per query? and would thus cut into Backpage?s pro?ts.

70. On July 28, 2011, LACEY sent LARKIN a draft editorial entitled ?BackPage
understood.? In this document, LACEY bragged about Backpage?s contributions to the
prostitution industry: ?Backpage is part of the solution. Eliminating our adult advertising
will in no way eliminate or even reduce the incidence of prostitution in this country. . . .
For the very ?rst time, the oldest profession in the world has transparency, record keeping
and safeguards.? LACEY also acknowledged that Backpage used an automatic ?lter to
remove particular phrases from ads that were indicative of prostitution but still published
the ads after editing them.

71. Soon afterward, LARKIN forwarded the editorial to OE, With a cover note
cautioning against some of statements ?being made public? because ?we need
to stay away from the very idea of ?editing? the posts, as you know.? CF, in turn, revised
the editorial to take out the paragraph landing Backpage?s contributions to the prostitution
industry.

72. On August 5, 2011, Backpage received a letter from the mayor of Seattle.
This letter warned that ?Seattle Police have identi?ed an alarming number of juvenile
prostitutes advertised on Backpagecom since January 2010? and explained that Backpage
was dissimilar from other companies whose products and services are ?occasionally or
incidentally? utilized by criminals because ?[y]our company is in the business of selling
sex ads? and ?your services are a direct vehicle for prostitution.? The letter also
recommended that Backpage require in?person age veri?cation for all of the ?escorts?
depicted in its ads. Afterward, Backpage declined to adopt these recommendations.

73. On August 15, 2011, PADILLA received an email containing an updated

version of Backpage?s moderation guidelines. This six-page document provided the

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following instructions concerning photographs: ?Nude rear shots are okay as long the
model is not exposing her anus or genitalia,? ?Transparent wet panties okay should not be
able to see personal private part,? and ?cherry, Ice-cream keeping in mouth [is okay] The
document also explained that ?Bikini, lingerie, g-string, thong, and hands covering nipples
are all allowed,? ?Hourly rates are and ?Sessions are okay. E. $50 session.? 7

74. On August 31, 2011, Backpage received a letter from the National
Association of Attorneys General. This letter characterized Backpage as ?a hub? for
human traf?cking, identified ?more than 50 instances, in 22 states over three years, of
charges ?led against those trafficking or attempting to traf?c minors on Backpagecom,?
and noted that ?[n]early naked persons in provocative positions are pictured in nearly every
adult services advertisement on Backpagecom and the .site requires advertisements for
escorts, and other similar ?services,? to include hourly rates. It does not require forensic
training to understand that these advertisements are for prostitution.?

75. On October 6, 2011, CF. sent an email discussing various proposals for
addressing ?the under aged issue.? With respect to one particular propOsal, C.F.

acknowledged it was a good one but recommended against adopting it because Backpage

would not derive any public-relations benefit from doing so: ?This is a good idea but it is

not visible to [state attorneys general] so it has little PR value. It is a low priority.?
76. In the fall of 2011, Backpage sought the assistance of a public relations ?rm
based in Washington, DC. On October 12, 2011, OF. received a written copy of the ?rm?s
presentation. Later, some of the BACKPAGE DEFENDANTS attended a meeting at
which the presentation was discussed in more detail. The presentation warned that
Backpage?s business practices would inevitably result in legal trouble (?One day the
proverbial is going to hit the fan?) and characterized Backpage?S ?media strategy? as ?Do
not acknowledge the prostitution.? The presentation also noted that the ?ads on the
backpagecom site? generally fall into three categories, one of which is ?Pimps and Men

Looking for Kids.?

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77. On October 21, 2011, LARKIN received an email discussing whether the
Backpage website should include a warning message concerning the prostitution of
children. This email contained the following joke: ?Andrew thinks it to[o] 
heavy handed and thinks our web site name will be entrapmentcom (Hilarious).?

78. On November 16, 2011, HYER and PADILLA received an email asking for
?urgent? assistance in eliminating the word ?teen? from the ads appearing on Backpage?s
website: ?Remove ads with teens or remove the text teen from . . . ads.? Thefollowing
day, PADILLA wrote back with an update that he had found ?76 pages of results? and that
he had simply ?edited? all Of the ads posted within the last two months allowed those
ads to remain on the website after sanitizing them).

79. Between around January and March 2012, many of Backpage?s moderators
(who were supervised in part by PADILLA and VAUGHT) underwent performance
appraisals. These appraisals revealed that many of the moderators did ?not report young
looking escorts.? Nevertheless, these moderators were allowed to keep their jobs, and
sometimes were given strong overall performance ratings.

80. On February 16, 2012, PADILLA sent an email to VAUGHT stating that
Backpage should limit the number of child-exploitation referrals it was making to
NCMEC: ?If we don?t want to blow past 500 this month, we shouldn?t be doing more than
16 a day.?

81. On February 23, 2012, OR was forwarded a legal notice claiming that
several of Backpage?s ads included copyrighted content from two competing websites
called RubMaps.com and EroticMP.com. C.F. also received copies of the underlying ads
from the competing websites, which clearly involved prostitution. In one of the ads, a
customer stated that, in return for $45 and a $5 tip, he had received a ?Blow Job . . . w/
condom? from a woman who ?had nice breasts.? In a different ad, a customer stated that,
in return for $60, he had oral and vaginal sex with a prostitute. 'And in a different ad, a

customer stated: ?Her bj was slow and erotic, and she was happy to go with Whatever

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Case Document 3 Filed 03/28/18 Page 20 of 61

position I wanted.? When C.F. forwarded these materials to Backpage?s staff, he was asked
whether the corresponding ads appearing on Backpage?s website should be removed
immediately. C.F. replied that they should be allowed to remain on Backpage for another
few weeks without any modification.

82. On March 15, 2012, HYER received an email concerning the ads with the
copyrighted material. This email stated that the ads shouldn?t be deleted and that
Backpage?s technical staff should merely ?strip out? the names of the competing
prostitution websites: ?Copyright infringement issue. We need to strip out every
appearance of rubmaps.com and eroticmp.com.? When a staff member sought more
guidance, HYER interjected: ?We don?t need to delete ads or users.?

83. On April 7, 2012, PADILLA was informed that a woman had contacted
Backpage to report that one of the ?escorts? depicted on the site was only 17 years old.
The woman provided the juvenile?s full name and birth year and further stated that the
juvenile had been attempting to recruit the complaining party?s daughter (who was 15). In
response, PADILLA instructed his staff to refuse to remove the ad because ?she?s isn?t
claiming her own daughter is in the ad.?

84. On April 8, 2012, LACEY sent an email emphasizing that ?jim 
and I believe in legalized prostitution? and stating that Backpage?s efforts to prevent the
prostitution of children on the site were ?not perfect, by any means.?

85. On April 25, 2012, a Backpage representative spoke at a meeting of the New
York City Council?s WOmen?s Issues Committee. During this meeting, the representative
stated it was better to have ads for sex work appear on Backpage than have them move to
other places on the internet. The representative further stated: don?t deny that Backpage
is part of the problem, but the problem is the internet.?

86. On April 27, 2012, a woman wrote an email to Backpage?s support
department stating that her underage daughter had been kidnapped, drugged, and was being

advertised as a prostitute against her will. The email identi?ed the specific phone number

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Case Document 3 Filed 03/28/18 Page 21 of 61

associated with the ads stated that the ads appeared on a website called
BackpagePics.com, and asked that the ads be removed immediately: ?This is a drugged
and held against her will child who had photos taken under threat and duress . . . . Please
remove.? This email was forwarded to PADILLA by a subordinate, who asked ?should
we respond?? PADILLA replied by explaining that, because the website

i BackpagePics.com wasn?t owned by Backpage, there was no need to respond to the

mother.

87. On April 30, 2012 (three days later), the same woman wrote another email

to Backpage?s support department. In this email, the woman stated that have contacted

backpage on several oCcassions [sic] to remove these pictures which were posted against
her will and while she was drugged and held captive. I have yet to receive a reply.? This
time, the woman provided a link to her daughter?s ad on Backpage (not
BackpagePics.com), which included the same phone number that had been
included in the other ad.

88. On May 1, 2012 (the next day), the same woman wrote a third email to
Backpage?s support department. In this email, the woman included a link to another ad on
Backpage depicting her underage daughter and stated: also found a pix of my daughter
within this url both girls are in protective custody.? Later that day, the woman received an
email from Backpage?s support department stating: ?The post is con?rmed removed.?

89. Some of these emails were forwarded to LACEY and LARKIN. In response,
LARKIN applauded Backpage?s ?good solid response? to the woman and remarkedi ?this
whole rigamarole seems a little odd to me.?

90. On May 10, 2012, the television news station CNN ran an expose on
Backpage that emphasized ?how young some of these girls look? and deemed the website
?a hub for the sex trade.? I

91. On May 11, 2012, PADILLA sent an email to VAUGHT and other Backpage

employees entitled ?ferbidden planet.? Enclosed with the email was an Excel spreadsheet

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that identi?ed over 600 words and phrases that are indicative of prostitution. The
spreadsheet also speci?ed, for each word and phrase, whether an ad containing the
offending language should be banned or whether Backpage should simply ?strip term from
ad? and then publish it after the revision.

92. On July 12, 2012, PADILLA sent an email (which was also shared with
VAUGHT) to the head of Backpage?s Indian moderation team. In this email, PADILLA
criticized the moderators for deleting too many ads and provided the following instruction:
agree that ?over cautiousness? is as big of a problem as moderators that miss a lot of
violations.?

93. In or around November 2012, a researcher at Arizona State University
published a study concluding that most of the ads on Backpage?s Phoenix page involved
prostitution and that many of the ads depicted juvenile traf?cking victims. On December
19, 2012, LACEY was forwarded a copy of the study?s results. The researcher responsible
for the study also met with a Backpage representative to propose various mechanisms for
reducing or eliminating the prostitution of children on the website. Backpage declined to
adopt these proposals.

94. Between around September 2010 and October 2012, OF. became aware that
a particular Backpage customer, P.R., was posting prostitution ads. Rather than bar this
customer from posting future ads, C.F. repeatedly restored her posting privileges and gave
her advice on how to conform to Backpage?s publication standards. The communications
involving this woman?s ads included the following:

- On September 26, 2010, OF. received an email from a woman who was
obviously posting prostitution ads on Backpage. The woman, whoSe email address
included the phrase ?provider4u,?i wrote to complain that her escort ad (?50 Red Roses
special Dont Miss out had been removed even though ?[o]ther women have more
explicit ads than me and they are up!? The woman continued: can not afford to have

this ad removed. This is the only way all the time I will not

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be able to pay my bills . . . . My ?ance is in jail and he is not able to help me at this

I point.? In response, C.F. arranged for the woman to be allowed to continue posting ads.

0 On October 6, 2010, C.F. received another email from the same woman. In
this email, she complained that her most recent ad had been removed because it included
an explicit picture of her body. She provided a copy of the picture to C.F. and stated: ?If
the person [who removed the ad] is such a prude well maybe they should check out the 
other women?s ads in that [escorts] section.? On November 15, 2010, C.F. wrote back to
the woman to encourage her to edit the ad so it could be re-posted: ?Ok, please try editing
the ad now.? After this exchange, the woman was permitted to resume posting ads on
Backpage. 

On June 6, 2011, C.F. received another email from the same woman. It
stated: would really appreciate it if you would please take the block off my ad for editing
. . . . I wont post any more objectionable pics, ok?? In response, C.F. arranged for the
woman?s editing and posting privileged to be restored: ?You should be able to edit
now. Please let us know if you are still having any trouble.? After this exchange, the
woman resumed posting ads on Backpage.

- On July 14, 2012, C.F. received another email from the same woman. It
stated: ?would you please take the edit block off my ad. I need to change some info on it
and update it. I promise i wont put no more nude pics in it, you have my word. . . [M]y
ad says: 50 red roses special dont miss out.? After this exchange, the woman was allowed
to continue posting ads on Backpage.

- On September 17, 2012, C.F. received another email from the same"
woman. This time, she complained that Backpage was editing her ads (whose title
continued to feature the obvious prostitution term ?50 Red roses special?) to remove the
most explicit pictures. She stated: would like to know Why my ad in the escort section
of backpage keeps getting messed with. . . . [S]omeone keeps erasing the link to my pics

on the ad. that is so wrong. I am being deprived of income that I sorely need . . . . There

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are other woman posting pics on their ads that show more nudity . . . After this exchange,
the woman was permitted to continue posting ads on Backpage.

On October 16, 2012, the woman wrote another email to Backpage. In this
email, she again complained about how Backpage was editing her ads to remove the most
explicit pictures. She stated: ?It is very hard for me to make any income from this ad as
they continually go into my ad and remove the link from the ad that goes to my
pictures. 'They wont allow me to post my pics on the ad yet other women with other ads
show more nudity than my pictures ever did.?

This email was forwarded to VAUGHT and to PADILLA, who asked
another Backpage employee to ?dig into this one a little.? On October 17, 2012, PADILLA
received a follow-up email from his co?worker stating that the woman?s ad had been posted .
on September 27, was still on the Backpage website, and that the pictures the woman had
originally attempted to include in the ad (which had been stripped by Backpage) were
?topless shots.?

0 Following these exchanges, between October 2012 and?November 2015, the
same customer was allowed to post over a dozen new ads on Backpage, many of which
utilized the same identifying information, coded prostitution terms, and contact phone
number as before. I

95. On January 7, 2013, VAUGHT was informed by a moderator that Backpage
wasn?t diligently pursuing reports of child exploitation: ?We?ve supposedly been checking

them, but some seem to be ignored. They get ?marked as read?, but nothing gets done with

them. It?s aggravating and irresponsible.?

96. On June 6, 2013, Backpage received a letter from NCMEC recommending

the adoption of several speci?c security measures to prevent the traf?cking of children.

The recommended security measures included verifying the age and identity of users
who submitted adult ads, verifying the age and identity of individuals depicted in

photographs within adult ads, (0) prohibiting the use of anonymous payment sources such

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as prepaid credit cards, and requiring users to utilize veri?ed email addresses and
telephone numbers. Afterward, Backpage declined to follow any of these
recommendations.

97. On August 30, 2013, LARKIN, SPEAR, BRUNST, HYER, and CF.
received an email notifying them that ?Chase [Bank] was no longer accepting transactions
from Backpagecom, due to their involvement in human trafficking.? In response, C.F.
informed the group that he intended to begin ?giv[ing] users free ads if they complain while
we wait on directly transactions to another processor.?

98. On September 11, 2013, a Backpage representative made a presentation to
the Arizona Governor?s Task Force on Human Traf?cking. Following this presentation
(which took place in Phoenix), the representative was asked whether there? would be any
?cons? to requiring veri?able identification of all escorts being advertised on Backpage?s
website. In response, the representative did not identify any ?nancial or logistical hurdles
to the adoption of such a requirement. Instead, the representative stated that such a
requirement would simply cause Backpage to lose business to other prostitution websites
like myRedBook.com or to overseas prostitution websites. During this meeting, members
of the task force also provided the representative with evidence showing that Backpage?s
moderation efforts were ineffective at preventing the publication of prostitution ads.

99. On April 3, 2014, PADILLA and VAUGHT were forwarded an email that
had been sent to Backpage by a credit card processing company in Canada. ?The email
stated that have multiple user accounts that are paying for your services for what I
understand to be prostitution advertisements? and sought information about ?how you are
processing these transactions.?

100. On April 14, 2014, LARKIN and BRUNST received an email from GE
discussing why Backpage had experienced ?past high growt and identifying various
ideas for achieving ?future growth.? This email stated that Backpage had been the

beneficiary of ?[m]igration of content from other . . . marketplaces to the internet? and

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Case Document 3 Filed 03/28/18 Page 26 of 61

identi?ed one particular marketplace as a key source of Backpage?s customers: ?[N]et loss
for brick and mortar marketplaces: Strip clubs, hotels, and gathering spots displaced by the
internet.? In other words, the email acknowledged that the supposed ?escorts? advertising
on Backpage were actually prostitutes (lawful escorts did not congregate at strip clubs,
hotels, and other brick4and?mortar ?gathering spots? during the pre-internet age). This
email also attributed Backpage?s success in part to. its adoption of policies that allowed
customers to post ads without leaving any meaningful identifying information?in a list of
Backpage?s advantageous policies, it identi?ed ?Anonymous,? ?Prepaid card friendly,?
?User can post paid ads without a valid email address,? and ?bitcoin.?

101. On April 24, 2014, VAUGHT sent an email to Backpage?s moderators (while
oc?ing PADILLA). In this email, VAUGHT explained that if a moderator came across an
ad containing a link to a ?sex for money? website, the moderator should add the link to a
list of banned terms but ?don?t bother removing it from the current ad.?

102. On September 4, 2014, Backpage was served with a brief that had been ?led
by NCMEC in a lawsuit in Washington state court. In this brief, NCMEC criticized the
sincerity of Backpage?s efforts to prevent child sex traf?cking: ?Backpage has repeatedly
claimed in public statements .and court ?lings that it is Working to reduce child sex
traf?cking on its website. The unpleasant reality is that Backpage publicizes carefully
selected operational processes as a subterfuge to avoid increased scrutiny, while providing
traf?ckers with easy access to online venue to sell children for sex. In practice,
Backpage?s stated interest in doing something meaningful to stop child sex traf?cking ads
on its site is apparently overridden by the enormous revenue it generates from its escort
ads, including ads selling children for sex.?

103. On March 17, 2015, a law enforcement of?cer with the California
Department of Justice spoke with a Backpage representative concerning the prevalence of
blatant prostitution ads on Backpage. In response, the representative did not dispute the

of?cer?s characterization and said the internet and prostitution were not going away.

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Case Document 3 Filed 03/28/18 Page 27 of 61

104. On July 30, 2015, a document entitled ?trainingJuly2015? was distributed to
Backpage?s moderators. This training manual speci?cally told moderators that, if they saw
a photograph depicting ?a person [who] looks young/minor,? they should ?approve dont
delete the ad unless it has a banned term.? The training manual also identi?ed, under the
heading ARE ALL a long list of terms that are indicative of prostitution,
such as ?99% CUM BACK FOR ?car service,? and ?lollipop special.?

105. In or around August 2015, as part of a lawsuit in Illinois, Backpage was
served with an af?davit from a detective employed by the Seattle Police Department. In
this af?davit, the detective avowed that date, no Detective within the Seattle Police
Department?s Vice/High Risk Victims Unit has ever found a legitimate ?escort? (person
who charges simply for companionship with no offer of sex) or ?masseuse? (person offering
legitimate and licensed massage therapy rather than sex) while responding to ads placed in
these categories on Backpage.com? and that ?every time the Seattle Police Department?s
Vice/High Risk Victims Unit has responded to an ad in the adult section of Backpagecom,
we have found that the ad was a posting for illegal activity.?

I 106. In or around August 2015, during the same lawsuit in Illinois, Backpage was
served with a different af?davit from a detective employed by the Boston Police
Department. In this af?davit, the detective avowed that ?Backpagecom is the number one
site in Boston for prostitution and sex traf?cking,? that his unit had ?[s]ince 2010 . . .
arrested over 100 buyers of sex of both adults and minors through Backpagecom ads,? and

that ?nearly all the cases we ?nd associated with it [Backpage] involve pimp controlled

- prostitution.?

107. On October 7, 2015, PADILLA received an email from another Backpage,
employee (which was later forwarded to VAUGHT) disclosing that there were ?massive
numbers of live ads with banned terms and pictures out on the site.?

108. On December 9, 2015, Backpage received an email from a reporter stating

that the 359 sex traf?cking incidents Toronto Police have been involved in since

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. Case Document3 Filed 03/28/18 Page 28 of 61

59

2013, every single girl that was rescued was advertised on Backpage. The email also
asked: ?Why hasn?t Backpage closed down the adult escort ads portion of its site like
Craigslist when it?s known that underage girls are being exploited via Backpage??

109. In or around January 2016, Company A was retained to serve as a payment
processor for some of Backpage?s websites. On April 29, 2016, Company A informed C.F.
that it had conducted ?a review of your web site, and unfortunately we had to suspend your
account . . . [because] advertising of illegal activities is strictly forbidden.?

110. Beginning in or around January 2016, Backpage?s moderators were
instructed to stop removing ads that contained the phrase For example, on January
28, 2016, VAUGHT was sent an email from a Backpage moderator explaining that ?As far
as I am aware we are no longer removing ads for Similarly, on March 9, 2016, a
Backpage moderator sent an email to his coworkers explaining that ?Andrew 
and I talked about the GFE thing, going forward we will not be removing ads for 
and clarifying ?this includes even gfe with price.? And again, on March 25, 2016, an email
was sent to Backpage?s moderation staff stating that ?We are no longer removing ads for
or 

111. In fact, the BACKPAGE DEFENDANTS repeatedly acknowledged that the
term experience) is a coded term for prostitution. For example:

0 On October 26, 2010, SPEAR, HYER, and PADILLA received an email
from C.F. that explained: ?No coded sex act for money: GFE, PSE, DATY, etc.?

0 On May 4, 2011, HYER sent an email to PADILLA and others identifying
GFE as a ?code word? that should be forbidden. 

- On August 31, 2011, PADILLA and CF. exchanged emails in' which they
discussed a list of 100 ?solid sex for money terms.? The list included girlfriend
experience.?

- On November 2, 2011, PADILLA and VAUGHT received an email from a

co?worker identifying GFE in a list of ?sex phrases and coded terms? that are ?not

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Case Document 3 Filed 03/28/18 Page 29 of 61

allowed.?

112. HYER, PADILLA, and other BACKPAGE DEFENDANTS periodically
received a ?Google alert? when articles discussing Backpage appeared in the news. Many
of the news articles identified in these alerts discuss instances in which prostitutes who had
been advertised on Backpage were kidnapped, raped, or murdered.

113. In January 2017, after conducting a investigation, the Senate
Subcommittee on Permanent Investigations (?Subcommittee?) issued a 50?page report
entitled ?Backpagecom?s Knowing Facilitation of Online Sex Traf?cking.? This report
concluded, among other things, that virtually all of Backpage?s ?adult? ads are actually
solicitations for illegal prostitution services and that ?Backpage has maintained a practice
of altering ads before publication by deleting words, phrases, and images indicative of
criminality, including child sex traf?cking . . . . Those practices served to sanitize the
content of innumerable advertisements for illegal transactions?even as Backpage
represented to the public and the courts that it merely hosted content others had created.?

114. In response to the Subcommittee?s report, Backpage purported to shut down
the ?adult? section of its website. However, the prostitution ads simply migrated to other
sections of the website, where they remain to this day.

D. International Operations

115. In addition to facilitating prostitution through its US. website, Backpage has
also facilitated prostitution through its websites in foreign countries. In this context,
Backpage often affirmatively creates the content of the illegal prostitution ads being
published.

116. Around 2013 or 2014, Backpage hired a Philippines?based company
(Company B) in an attempt to increase the pro?tability of Backpage?s international
operations. Company B?s employees were instructed to (1) visit rival prostitution websites

in other countries, (2) obtain the email addresses of prostitutes who were posting ads on

those websites (often by falsely posing as prospective customers), (3) use the information

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from the other website to create a competing prostitution ad on Backpage (a process
referred tointernally as ?preboarding?), and then (4) transmit the new ad to the prostitute,
often using the previously-harvested email account information, in an attempt to persuade
the prostitute to become a Backpage customer. Company B?s employees were paid
bonuses based on the amount of ad revenue they generated for Backpage using these
techniques.

117. Backpage?s executives were fully aware of the plan to use Company to
create prostitution ads outside the United States. For example, on or around November 6,
2013, CF. made a presentation to LARKIN, SPEAR, and BRUNST, Among other things,
this presentation summarized Backpage?s plans for ?International Planning and
Expansion.? One of the plans was to use the Philippines as a ?test? market and hire Filipino
contractors to ?contact by email leads, secure email address, add ad and email address in
[computer system] and assign to American staff. American staff makes contact.?

118. On August 7, 2014, HYER sent an email stating that Company was ?an
ef?cient and cost effective way for us to bring new users to backpage.? This email also
contained the following summary of how Company would operate: ?Process after hiring
company offering BPO services: 1. Backpage provides BPO with sites, categories 
countries to target. Backpage also provides sample ?scripts? and? examples of phone
calls. 2. BPO contacts users via phone from sites backpage provided, obtains user email
address permission to preboard ad. 3. BPO preboards ad as public user. 4. After ad is
preboarded, users receive verification link to verify the ad.? This email also stated that
Backpage would offer a ?bonus per veri?ed authenticated ad.?

119. On April 10, 2015, a ??ve-year business plan? was emailed to LARKIN,
BRUNST, SPEAR, and CF. One of the goals for 2015 was ?Off shore marketing staff in

the Philippines to grow to 166 and main task is international market content acquisition.?

This email also included a separate attachment stating that HYER should be considered for

promotion because ?his are strong marketing and revenue growth skills? and he

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Case Document 3 Filed 03/28/18 Page 31 of 61

had been ?heavily involved in the user experience development? and that VAUGHT should

\be considered for a promotion because ?[h]er include six years of experience

managing moderators.?

120. On May 15, 2015, a Company employee posing as a Backpage employee
sent an email to an apparent prostitute. The subject line was ?Offering Free Advertisement
from Backpagecom? and the text of the email sought to persuade the prostitute to ?upgrade
your ad with sponsor placement or automatic repost.? In response, the prostitute wrote
back that she had ?managedto activate my ad and could buy credits as well. thanks for
your help. I?m traveling today to [London] how can I change my location.? This email
exchange was later forwarded by HYER to C.F. with a cover note stating: deal scenario
for [Company agent user activates ad, user purchases credit.?

121. On December 14, 2015, C.F. was part of an email exchange concerning an
ad that had an IP address associated with Company B. This email contained the following
description of Company B?s process for creating and selling prostitution ads on Backpage:
(1) ?Staff found lead in assigned area.? (2) ?Staff entered all relevant into [database]
(3) ?Staff called lead to discuss creation of free ad? (4) Staff created
free ad for lead (verification email sent). (5) Staff followed under with an email reminding
lead of phone conversation and detailing veri?cation of ad.?

E. Select Victim Summaries

122. Between in or around 2009 and 2013, Victim 1 was sold for sex, through the
use of Backpage ads, in Ohio, Indiana, and Georgia. Victim 1?s Backpage ads often
included words and phrases that were indicative of prostitution, such as ?roses? (money).
On at least one occasion, Victim I contacted Backpage after a proposed ad had been
rejected because it contained banned words and phrases. In response, a Backpage
representative coached Victim 1 on how to re-write the ad using different words. Victim
1?s trafficker took all of the money that was earned through her acts of prostitution.

123. Between in or around 2009 and 2011, Victim 2 was sold for sex, through the

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Case Document 3 Filed 03/28/18 Page 32 of 61

use of Backpage ads, in Arizona, Georgia, North Carolina, Texas, New York, New Jersey,
and Louisiana. Victim 2?s trafficker drafted her Backpage ads and Victim 2 initially did
not know she was being offered on Backpage. The ads contained words and phrases to
make customers believe Victim 2 was ?barely legal? and also contained words and phrases
indicative of prostitution, such as ?roses? (money).

124. Between in or around 2009 and 2012, Victim 3 was sold for sex, through the
use of Backpage ads, in Colorado and North Dakota. Victim 3?s pimp instructed her to
review existing prostitution ads on Backpage to learn how to draft her own ads. During a
portion of this period, Victim 3 was required by her pimp to make week?long trips to North
Dakota to work as a prostitute. During these trips, which would generate as much as $2,000
in prostitution?derived revenue each day, Victim 3 was forced to leave her children at home
in the care of her pimp.

125. In or around 2010, Victim 4 was sold for sex, through the use of Backpage
ads, in Washington. During this period, Victim 4 was a juvenile (15 years old). Victim
4?s pimp drafted the ads that were placed on Backpage. The wording of these ads was
edited by Backpage before publication. The ads contained words and phrases such as
and WONT TAKE LONG AT 
and included pictures of Victim 4 in provocative positions showing her breasts and
buttocks.

126. Between in or around 2011 and 2016, Victim 5 was sold for sex, through the
use of Backpage ads, in Massachusetts and Rhode Island. During much of this period,
Victim 5 was a juvenile (14?19 years old). Victim 5?s female pimp instructed Victim 5 -
that Backpage was the safest place to advertise because it did not require age veri?cation.
On one occasion, Backpage declined to accept a proposed ad that indicated Victim 5 was
only 17 years old. In response, the ad was simply resubmitted with a new (false) age of
19. On other occasions, Backpage removed provocative pictures of Victim 5 from ads and

then allowed edited versions of the ads to be published. Victim 5 ?s Backpage ads included

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Case Document 3 Filed 03/28/18 Page 33 of 61

words and phrases that were indicative of prostitution, such as ?roses? (money) and ?back
door? (anal sex). Some of the customers who responded Victim 5?s Backpage ads forced

Victim 5 to perform sexual acts at gun point, choked her to the point of having seizures,

and gang?raped her.

127. In or around June 2012, Victim 6 was sold for sex, through the use of
Backpage ads, in Arizona. Her traffickers utilized Backpage ads that did not Offer a

specific person but instead generally offered a woman with a particular type of hair color

I and build. On June 22, 2012, Victim 6 was dispatchedto a customer who had responded

to a Backpage ad featuring ?Nadia,? who was described as a slender brunette woman.
Upon her arrival at the location, Victim 6 was stabbed to death.

128. Between in or around 2012 and 2015, Victim 7 was sold for sex, through the
use of Backpage ads, in Washington and Oregon. Victim 7?s pimp drafted the ads that
were placed on Backpage. The wording of these ads was edited by Backpage before
publication. The ads contained provocative nude pictures of Victim 7.

129. Between in or around 2013 and 2014, Victim 8 was sold for sex, through the
use of Backpage ads, in Maine, Connecticut, and Massachusetts. During this period,
Victim 8 was a juvenile (15 years old). Victim 8?s uncle, as well as his friends, placed the
ads on Backpage, which included words and phrases that were indicative of prostitution,
such as ?roses? (money), ?fetish friendly,? and 150 for 1/2 hour, 200 for full hour.
Through these ads, Victim 8 was forced to do ?in-calls? (where she was raped in hotels) as
well as ?out-calls? (where she was raped at other locations chosen by the men paying for
her).

130. In or around 2013, Victim 9 was sold for sex, through the use of Backpage
ads, in Florida. Victim 9?s pimp taught her how to use code words in her Backpage ads to
indicate how much she was charging for certain sex) acts. Victim 9 was brutally attacked
by her traf?cker, causing bruises and a fractured cheek bone.

131. Between in or around 2014 and 2015, Victim 10 was sold for sex, through

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Case Document 3 Filed 03/28/18 Page 34 of 61

the use of Backpage ads, in California and Arizona. During some of this period, Victim
10 was a juvenile (17 years old). An associate of Victim 10?s pimp took pictures of her
and drafted the ads that were placed on Backpage. The Backpage ads contained words and
phrases such as IN ?sexy sweet,? and ?sweet like honey but super hot like
fire? and included pictures of Victim 10 in provocative positions showing her legs,
stomach, shoulder, and buttocks.

132. Between in or around 2014 and 2015, Victim 11 was sold for sex, through
the use of Backpage ads, in Arizona, Colorado, Minnesota, Oregon, California, Montana,
Nevada, New Mexico, and Utah. The Backpage ads contained words and phrases
indicative of prostitution and included pictures of Victim 11 in provocative positions. On
some occasions, Backpage would remove certain explicit photos from the ads but publish
the remaining text and other photos. Victim 11?s traf?cker gave her drugs, took her
identi?cation documents, sexually assaulted her with a firearm, and forced her to work full?
time as a prostitute.

133. In or around 2015, Victim 12 was sold for sex, through the use of Backpage

ads, in California and Arizona. Victim 12 was first advertised on Backpage in San

Bemardino, California, but moved to the Phoenix metro area because the Super Bowl was

I being held there. Victim 12?s advertisements on Backpage contained words and phrases

such as ?New In Town? and ?Sexy Dark Asian Bombshell with a Nice Tight {Booty}?
and included pictures showing Victim 12?s legs, stomach, shoulders and buttocks.

134. In or around 2015, Victim 13 was sold for sex, through the use of Backpage
ads, in California. During this period, Victim 13 was a juvenile (15 years old). Victim 13
and her trafficker both posted the Backpage ads, which falsely represented that Victim 13
was 19 years old and showed pictures of her face and body. On at least-one occasion, a
Backpage representative contacted Victim 13 with instructions could be published.

135. In or around June 2015, Victim 14 was sold for sex, through the use of a

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Case Document 3 Filed 03/28/18 Page 35 of 61

Backpage ad, in Texas. This ad contained words and phrases such as ?fun, young, exotic,?
?Ready to be your fantasy girl,? CALLS and BLACK and
included pictures of Victim 14?s stomach, breasts, shoulders, and buttocks. On or around
June 20, 2015, Victim 14 was murdered by a customer. Afterward, the customer attempted
to destroy Victim 14?s corpse by lighting it on fire. Victim 14?s father later contacted
Backpage to request that the ads showing his deceased daughter be removed. Backpage
did not immediately comply with this request.

136. In or around June 2015', Victim 15 was sold for sex, through the use of
Backpage ads, in Texas and Louisiana. These ads contained words and phrases such as
?Thick Glass of Chocolate Milk Looking for-a GoodTime! l? and ?sexy certi?ed freak?
and contained pictures showing Victim 15?s legs, shoulders and buttocks. On June 10,
2015, Victim 15 was forced into a vehicle with her traf?cker, who was attempting to take
her to Texas against her will. In an attempt to escape, Victim 15 jumped out of the vehicle
onto Interstate 10 and was killed after being hit by several vehicles at high speeds.

137. In or around July and August 2015, Victim 16 was sold for sex, through the
use of Backpage ads, in Michigan. These ads contained words and phrases such as
?Juicy Caramel Lady On Duty,? ?Sexy, Erotic Caramel Dream,?
and ?No Thugs, Pimps Or Weirdos? and contained pictures showing Victim 16?s breasts,
legs, lips, buttocks, and face. On August 15, 2015, Victim 16 was murdered by a customer.
Afterward, the customer dumped her corpse in a park. A

138. Between in or around 2015 and 2016, Victim 17 was sold for sex, through
the use of Backpage ads, in Arizona and California. Victim 17 averaged ten customers a
day during this time and turned over all of her prostitution earnings (approximately $1,500
per day) to her pimp. An associate of Victim 17?s pimp took pictures of her and drafted
the ads that were placed on Backpage. The Backpage ads contained words and phrases
such as ?I?m here to make your wildest fantasies come true!? and
?Sorry, but NO BLACK and included pictures of Victim 17?s buttocks and face.

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Case Document 3 Filed 03/28/18 Page 36 of 61

F. Money Laundering Activities I
139. Backpage?s customers have overwhelmingly used the proceeds of criminal

activity (15.6., money earned from pimping and prostitution) when purchasing ads on

Backpage. In addition, because Backpage?s publication of such ads is an independent

crime (6g, violation of 18 U.S.C. 1952), the fees it collects from customers posting
prostitution ads?estimated at more than $500 million since 2004?constitute the proceeds
of unlawful activity.

140. For these and other reasons, banks and financial institutions have repeatedly
refused to do business with Backpage. In response, the BACKPAGE DEFENDANTS have
pursued a variety of money laundering strategies. For example, on August 27, 2013, CF.
was forwarded an array of emails from Backpage customers who were complaining that
their credit card companies had refused to process Backpage-relatedtransactions. One A
customer wrote: ?Have you resolved the issue of Chase Bank not honoring payment for
you for ethical reasons?? C.F. forwarded these complaint emails to LARKIN, SPEAR, and
BRUNST and proposed, as a ?solution? to the problem, that Backpage recon?gure its
website to fool credit card companies into believing the charges were being incurred on a
different website. I

141. During a November 2013 preSentation by GP. to LARKIN, SPEAR, and
BRUNST, C.F. again discussed strategies for fooling credit card companies into believing

that Backpage-associated charges were being incurred on different websites, including a

proposal to set up shell companies without any apparent connection to Backpage (?create

new companies with new principals?) and use their bank accounts to accept payment.
Another ?solution? was to ?allow users to fund an account thru several other sites? that
?have no adult or images.?

142. On November 6, 2013, LARKIN, SPEAR, and BRUNST received an email
entitled ?Options for the future of Backpage.? This email discussed various strategies for

creating new entities to process Backpage?related payments ?Without ever disclosing ties

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rCase Document 3 Filed 03/28/18 Page 37 of 61

to Backpage.?

143. On April 1, 2015, BRUNST and CF. were informed that Mastercard was
?snooping around? Backpage and might stop processing payments for Backpage. In
response, C.F. offered several suggestions for setting up new payment channels that would
conceal Backpage?s involvement. One such proposal was to begin routing Backpage?
related transactions through banks 10cated in the country of Mauritius. In response,
BRUNST stated: ?Didnt we go down the Mauritius path once and the banks had the same
issue with our content??

144. Notwithstanding these strategies, the three major credit card companies
stopped doing business with Backpage. On or about April 30, 2015, Backpage learned that
American Express would no longer allow its cards to be used for any purchases in
Backpage?s adult section. In or around July 2015, Backpage learned that Mastercard would
no longer allow its cards to be used for Backpage-related transactions. When discussing
this decision, MasterCard stated that it ?has rules that prohibit our cards from being used
for illegal activities.? Around the same time, Backpage learned that Visa would no longer
allow its cards to be used for Backpage?related transactions. When discussing this
decision, Visa stated that its ?rules prohibit our network from being used for illegal
activity.?

145. Similarly, some banks closed accounts that were held by Backpage (or
Backpage-related entities) out rof concern the accounts were being used for illegal purposes. 
For example, on April 2, 2014, BRUNST received a letter from US. Bank that was
addressed to ?Backpagecom.? The letter explained: ?Dear Jed . . . please be advised that
we have elected to close your Account with us.?

146. Backpage responded to these developments in several ways. One was to
encourage customers to send checks and money orders to a Post Of?ce box held in the
name of a seemingly-unrelated entity called Posting Solutions LLC (?Posting Solutions?)

and give such customers a corresponding credit on Backpage. For example, on July 31,

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Case Document 3 Filed 03/28/18 Page 38 of 61

2015, C.F. exchanged email correspondence with a representative from . a payment
processing company. In this email, C.F. identi?ed himself as the CEO of Posting
Solutions, described Backpage as a ?brand? operated by Posting Solutions, and explained
he was seeking to ??nd a way to position payments under another company.?

147. The following episode provides an example of how the Posting Solutions
payment process worked. On' October 16, 2015, Backpage received an email from a
customer complaining about her inability to pay for ads using a credit card. In response, a
Backpage representative explained?in an email exchange later forwarded to 

that you would like to pay for upgrades or buy credits, we suggest posting with

alternative payment methods such as Bitcoin. If you are in the United States, you can also

pay by check or money order. Please make payable to ?Posting Solutions.? WE CAN
ONLY ACCEPT CHECKS OR MONEY ORDERS MADE OUT TO 
Posting Solutions. Attn: Accounts. PO. Box 192307. Dallas, TX 75219.
Please send through the United States Postal Service. FedEx, UPS, or other maildelivery
alternatives cannot deliver to a PO. Box. When sending your payment please be sure to
include your email address. Please do not make your payments out to backpagecom as we
will no longer be able to accept them.?

148. Between around September 2015 and June 2016, over $7.1 million of checks
and money orders sent by Backpage customers were deposited in bank accounts held by
Posting Solutions. 

149. Backpage also utilized a different entity, called Website Technologies, LLC
(?Website Technologies?), to process Backpage-related funds and took steps to make it
appear that'Backpage and Website Technologies were independent entities. For example,
on March 10, 2014, BRUNST, SPEAR, and others participated in an email exchange with
the subject line ?Website Technologies vs Backpage (Vendors, audits, risk assessments,
email)? During this exchange, one person stated and I were just discussing

company names and the possibility of updating our email addresses to

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Case Document 3 Filed 03/28/18 Page 39 of 61

websitetechnologiescom.? In response, BRUNST cautioned: ?We need to think this thru
or all the work to separate it from BP will be lost.? Similarly, on April 3, 2014, BRUNST
sent an email to SPEAR and others. explaining that May 1 we will have to be out of
US Bank. We will move all banking under Website Technologies at [a different bank,
BMO Harris].?

. 150. In many instances, Backpage?related money that was initially deposited into
accounts held by Posting Solutions was later transmitted to accounts held by Website
Technologies. For example:

- On October 27, 2015, C.F. received an email entitled ?Two packages coming
your way! (Money Orders).? The email stated that two UPS packages ?lled with money
orders were being sent~one containing $47,647.25 of money orders made out to Backpage
and the other containing $52,251.48 of money orders made out to Posting Solutions.

Similarly, on November 16, 2015, C.F. received an email entitled ?Three
packages sent today $441,408.69.? The email stated that three packages ?lled with money
orders were being sent?one containing $129,193.61 of money orders made out to
Backpage, another containing $244,353.63 of money orders made out to Posting Solutions,
and the last containing-an additional $67,861.75 of money orders made out to Posting
Solutions.

And again, on January 29, 2016, a Posting Solutions account wired $2.4
million to a Website Technologies account. PADILLA and C.F. were both authorized
signers on the recipient account.

151. In addition to receiving millions of dollars from Posting Solutions, the
Website Technologies accounts also served as the repository for millions of dollars of wires
from international bank accounts controlled by Backpage?associated entities. For example,
between January 2015 and December 2016, Website Technologies accounts received over
$45.4 million in wire transfers from Backpage?associated bank accounts in Liechtenstein,

over $30.1 million in wire transfers from Backpage-associated bank accounts in Iceland,

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Case Document 3 Filed 03/28/18 Page 40 of 61

and over $3.9 million in Wire transfers from Backpage-associated bank accounts in the
Netherlands.

152. In many instances, the next stage of the money-laundering process was for
money to be wired from Website Technologies accounts to bank accounts held by" a
different entity called Cereus Properties LLC (?Cereus Properties?). The? authorized
signers on the Cereus Properties accounts included SPEAR and BRUNST. Between
around December 2015 and October 2016, Website Technologies accounts sent wire
transfers totaling over $47 million to accounts held by Cereus Properties.

153. Accounts held by' Cereus Properties also received money directly from
international bank accounts controlled by Backpage-associated entities. For example,
between around August 2016 and November 2016, Cereus Properties accounts received
over $11.3 million in deposits and wire transfers from Backpage-associated accounts in the
Netherlands.

154. After money reached Cereus Properties, large portions of it were funneled
back to Backpage or to certain BACKPAGE DEFENDANTS. For example, between
January 2016 and January 2017, LACEY (and family members) received
distributions totaling over $30.3 million. and LARKIN separately received distributions
totaling over $21 million.

155. Backpage also furthered its money laundering efforts through the use of
bitcoin processing companies. Over time, Backpage utilized companies such as CoinBase,
GoCoin, Paxful, Kraken, and Capital to receive payments from customers and/or
route money through the accounts of related companies.

156. Backpage also furthered its money laundering efforts by developing ways for
customers to purchase ads using gift cards issued by third?party vendors.- This process was
described in a July 23, 2015, email exchange between various Backpage employees on
which HYER and others were copied. This exchange-included the following: ?[W]hat if

we used a customers [sic] payment method, say visa prepaid card, to buy [bitcoin] from

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Case Document 3 Filed 03/28/18 Page 41 of 61

our seller account A. . . giving said bitcoin to our catch-all wallet elsewhere (instead of to
user), simultaneously adding credits/purchasing paid ad or upsells? From the user?s
perspective they just input their prepaid card and get their credits or purchase.?
COUNT 1
(Conspiracy)

157. The factual allegations in Paragraphs 1?156 are incorporated by reference
and re?alleged as though fully set forth herein.?

158. Beginning in or around 2004, and continuing through the present, in the
District of Arizona and elsewhere, defendants LACEY, LARKIN, SPEAR, HYER,
PADILLA, and VAUGHT, and others known and unknown to the grand jury, knowingly
and intentionally agreed, confederated, and conspired with each other, and with others
known and unknown to the grand jury, to commit the following offenses against the United
States:

a. 18 1952(a)(3)(A) (Travel Act?Facilitate Prostitution).
OBJECT OF THE CONSPIRACY
159. The object of the conspiracy was to obtain money.
A MANNER AND MEANS CONSPIRACY

160. The manner and means of the conspiracy are described in paragraphs 1-156

above, incorporated by reference and re?alleged as though fully set forth herein.
OVERT ACTS

161. Overt acts were committed in furtherance of the conspiracy, including but
not limited to those described in paragraphs 1?156 above, incorporated by reference and
re-alleged as though fully set forth herein.

In Violation of 18 U.S.C. 371.

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Case Document 3 Filed 03/28/18 Page 42 of 61


(Travel Act?Facilitate Prostitution)

162. The factual allegations in Paragraphs 1?161 are incorporated by reference
and re-alleged as though fully set forth herein.

163. On or about the dates set forth below, each instance constituting a separate
count of this Indictment, in the District of Arizona and elsewhere, defendants LACEY,
LARKIN, SPEAR, HYER, PADILLA, and VAUGHT, and others known and unknown to
the grand jury, used the mail and any facility in interstate and foreign commerce with intent
to otherwise promote, manage, establish, carry on, and facilitate the promotion,
management, establishment, and carrying on of an unlawful activity, to wit: prostitution
offenses in violation of the laws of the State in which they are committed and of the United
States, including but not limited to Title 13, Arizona Revised Statutes, Section 13?3214,
and thereafter performed and attempted to perform an act that did promote, manage,
establish, carry on, and facilitate the promotion, management, establishment, and carrying

on of the unlawful activity, as follows:

 

 

Count Date Description
2. Sept. 10, 2013 Publish ad depicting Victim 5 entitled ?Get freaky Tuesday .

. Come spend ur day with us 19,? with accompanying text
?Doin incalls and outcalls?i

3. Jan. 27, 2014 Publish ad involving P.R. entitled ?50 Red 
DONT MISS 

 

 

4. Jan. 29, 2014 Publish ad depicting Victim 8 entitled ?Puerto Rican mami in
walpole area INCALLS ~19? after deleting one picture from
the originally-submitted ad

 

5. Jan. 31, 2014 Publish ad depicting Victim 8 entitled f?Exotic latina, south

 

 

 

 

portland area, ready to play, INCALLS, 30 min 

 

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Case Document 3 Filed 03/28/18 Page 43 of 61

 

19? after deleting one picture from the originally-submitted

ad

 

 

 

 

 

 

 

 

 

 

 

 

6. Feb. 6, 2014 Publish ad involving P.R. entitled ?75 Red 
DONT MISS 

7. Apr. 20, 2014 Publish ad involving P.R. entitled ?50 Red 
DONT MISS 

8. May 7, 2014 Publish ad involving P.R. entitled ?50 Red 
- DONT MISS 

9. May 31, 2014 Publish ad involving P.R. entitled ?50 Red 

- DONT MISS 

10. July 1, 2014 Publish ad involving P.R. entitled ?50 Red 
DONT MISS 

11. Aug. 19, 2014 Publish ad involving P.R. entitled ?50 Red 
- DONT MISS 

12. Nov. 23, 2014 Publish ad depicting Victim 10 entitled ?New in Town Super
Hot Skinny Mixed Cuban Girl With Long Black Hair 18?
after deleting picture from originally?submitted ad

13. Jan. 29, 2015 Publish ad depicting Victim l2 entitled ?New in Town Sexy
Dark Asain Bombshell with a Nice Tight {Booty} 23?
after deleting one picture from the originally?submitted ad

14. Jan. 31, 2015 Publish ad depicting Victim 10 entitled IN TOWN
sexy sweet European mixed Cuban California girl 21?

15. Jan. 31, 2015 Publish ad depicting Victim 12 entitled ?New in Town Sexy
Dark Asian mixed Bomb shell 23? after deleting one picture
from the originally?submitted ad

16. Feb. 4, 2015 Publish ad depicting Victim 11 entitled ?Upscale Independent

 

 

BRUNETTE BOMBSHELL 5-Star Fantasy 26,? after

 

 

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Case Document 3 Filed 03/28/18 Page 44 of 61

 

deleting pictures from originally-submitted ad

 

17.

Feb. 18, 2015

Publish ad depicting Victim 11 entitled ?Alexis Foxx the
HOTTEST in town! 26,? after deleting six pictures from

the originally-submitted ad

 

18.

Feb. 26, 2015

Publish ad involving P.R. entitled ?50 Red 
DONT MISS 

 

19.

May 18, 2015

Publish ad depicting Victim 15 entitled ebony
PLAYMATE Perfect Curves. . .Skills to make ur TOES
CURL 19,? after removing one picture of originally-
submitted ad, with accompanying text ?you agree . . . you are
not af?liated with any law enforcement agency? and ?Incalls

Outcall! 

 

20.

May 19, 2015

Publish ad depicting Victim 15 entitled ?Hot Driping
Submissive Ebony Playmates 20,? after removing one
picture of originally-submitted ad, with accompanying text
?you agree . . . you are not af?liated with any law enforcement
agency? and ?We?re ready to please and accommodate all of
your needs and wants!! With a mouth that?ll ROCK your 

and a [picture of cat] that?ll leave you purring for more?

 

21.

July 1, 2015

Publish ad depicting Victim 17 entitled ?AbSoLuTeLy
AmAziNg CoMe WiTh Me #1 MOST WaNtEd 
PlAymate 20,? With accompanying text ?By
contacting me you agree that you are not af?liated with any
form of law enforcement,? PERFECT Will satisfy your
every need,? and 

 

 

22.

 

July 2, 2015

 

Publish ad depicting Victim 17 entitled ?SeXy!! Exotic,
playmate Call me! the girl you NEED to See! 20,? with

 

 

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Case Document 3 Filed 03/28/18 Page 45 of 61

 

accompanying text DO NOT OFFER 40$, 50$, 60$
and 

 

23.

Aug. 13, 2015

Publish ad depicting Victim 13 entitled ?Young SEXY
PUERTO RICAN 19,? which accompanying text do half
hour sessions that vary in donation prices, 80 for head, 120
for hooking up without head and 150 for hooking up with
head? 

 

24.

Aug. 15, 2015

Publish ad depicting Victim 16 entitled ?Outcalls Now
Freaky Curvy Caramel Lady OUTCALLS NOW 23?

 

25.

Sept. 13, 2015

Publish ad involving P.R. entitled ?50 Red 
DONT MISS 

 

26.

Nov. 28, 2015

Publish ad involving P.R. entitled ?50 Red 
DONT MISS 

 

27.

Apr. 21,2016

Publish ad entitled inally!! PSE GFE Kimber Rae and
MIA Marie Together BOOK 

 

28.

Nov. 3, 2016

Publish ad entitled New 18?

 

29.

Nov. 11, 2016

Publish ad entitled ?Mind blowing Tiffany. Incall in Taunton
37,? with accompanying text ?Soft GFE . . . 1m real and

reviewed?

 

30.

Nov. 14, 2016

Publish ad entitled ?Top Model 2016 Special ?Best Looking
Young Asian? . . . 22,? with accompanying text ?Sexy Asian

Girl Incall Service? and 

 

 

31.

 

Nov. 14,2016

 

Publish ad entitled ?Sometimes It?s All About The Journey,
And The Destination. . DysfunctiOnal 
Provider 44,? with accompanying test ?You can ?nd a few
current reviews at T3R and have been EROS

authenticated?

 

 

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Case Document 3 Filed 03/28/18 Page 46 of 61

 

32.

Nov. 19, 2016

Publish ad entitled ?The True (G)irl (F )riend (E)xperience. ..
Visiting November 27th Sunday PRE-BOOKING
SPECIAL - 100,? with accompanying text ?Let?s blur
restrictions between ?nancial transaction Romantic

Connection?

 

33.

Nov. 24, 2016

Publish ad entitled ?Top Asian Grand Opening 100% Young
100% Sexy . . . 23,? with accompanying text 
INCALL IN and 

 



34.

Nov. 26, 2016

Publish ad entitled LOVE I ?m a GFE. OutCall and

Incall with exception on the 42?

 

35.

Dec. 20, 2016

Publish ad entitled Sexy Sensual 
Stacked College Coed With The Best Mouth Ever! BOOK
with accompanying text do ALL the things 
YOU Wish Your Wife Did! and 30 min/$180?

 

36.

Jan. 15, 2017

Publish ad entitled ?Real Reviewed Girlfriend
Theonesweetweeblycom 30,? with accompanying text

?250 

 

37.

Apr. 4, 2017

Publish ad entitled GFE KOREAN GIRLS 
20?

 

38.

Apr. 11,2017

Publish ad entitled ?Pettit Sexy #Corey# 4407239339 39,?

with accompanying text ?complete GFE experience?

 

39.

July 3, 2017

Publish ad entitled HANG OUT NOW UpScale
New-In Town! Call ME now for an unforgettable visit 20,?

with accompanying text ?100% GFE with 100% no Pimps?

 

 

40.

 

July 15,2017

 

Publish ad entitled ?Ready for some fun daddy? This is your
chance too have a amazing time - 21,? with accompanying

text ?Slim body, nice tits, freaky, 

 

 

-46-

 

 

 






Case Document 3 Filed 03/28/18 Page 47 of 61

 

 

 

 

 

 

 

 

 

 

 

 

 

 

41. July 15, 2017 Publish ad entitled ?New in town BiGBubble Booty
HOT BODY 24,? with in
accompanying text

42. July 21, 2017 Publish ad entitled ?Pettit Sexy #Corey# 4407239339 30,?

,1 with accompanying text ?complete GFE experience?

43. July 23, 2017 Publish ad entitled GODDESS young 20,? with
accompanying text ?100% Discreet service? and 

44. Jan. 26,2018 Publish ad entitled Service Available! Private
Encounters w/ Pampering Beauty?

45. Jan. 30, 2018 Publish ad entitled ?241 white plans area Carfun Perfect

. Treat Available No Rush,? with ?Sweet Sexy in
accompanying text

46. Jan. 30, 2018 Publish ad entitled REAL HOT Sweet DREAM
AMAZING BEST 

47. Jan. 30, 2018 Publish ad entitled ?Tall, Slim Sexy Luxe Goddess 
NARCISA Sensual Body Rub Fetish Sessions,? with
accompanying text ?gfe Hh: $160 H: $220?

48. Jan. 31, 2018 Publish ad entitled ?Exotic Asian Beauty,? with
accompanying text am an independent GFE with excellent
massage skills?

49. Feb. 1, 2018 Publish ad entitled ?Nuru (Best GFE ever) incall only?

50. Feb. 6, 2018 Publish ad entitled ?Tuesday with Ashleigh. Available now,?
with in accompanying text

?51. Feb. 6, 2018 Publish ad entitled Kisskisspop 100% Real Photo

Choice 9Asian girl Nurunude?

 

 

In violation of 18 U.S.C. 1952(a)(3)(A) and 

-47-

 

 

 






 

Case Document 3 Filed 03/28/18 Page 48 of 61

COUNT 52
(Conspiracy To Commit Money Laundering)

164. The factual allegations in Paragraphs 1-163 are incorporated by reference
and re-alleged as though fully set forth herein.

165. Beginning in or around 2004, and continuing through the present, in the
District of Arizona and elsewhere, defendants LACEY, LARKIN, SPEAR, BRUNST, and
HYER, and others known and unknown to the grand jury, knowingly and intentionally
agreed, confederated, and conspired with each other, and with others known and unknown
to the grand jury, to commit the following offenses against the United States:

a 18 U.S.C. 1956(a)(1)(A)(i) (Promotional Money Laundering)
b. 18 U.S.C. 1956(a)(1)(B)(i) (Concealment Money Laundering)
c. 18 U.S.C. 1956(a)(2)(A) (Int?l Promotional Money Laundering)
d. 18 U.S.C. 1956(a)(2)(B)(i) (Int?l Concealment Money Laundering)
e. 18 U.S.C. 1597 (Transactional Money Laundering)
In violation of 18 U.S.C. 1956(h). 
COUNTS 53-62
(Concealment Money Laundering)

166. The factual allegations in Paragraphs 1?165 are incorporated by reference
and re-alleged as though fully set forth herein.

167. On or about the dates set forth below, each instance constituting a separate
count of this Indictment, in the District of Arizona and elsewhere, defendants LACEY,
LARKIN, SPEAR, BRUNST, and HYER, and others known and unknown to the grand
jury, knowing that the property involved in a ?nancial transaction represented the proceeds
of some form of unlawful activity, conducted and attempted to conduct suCh a ?nancial
transaction which in fact involved the proceeds of speci?ed unlawful activity knowmg that
the transaction was designed in whole and in part to conceal and disguise the nature, the

location, the source, the ownership, and the control of the proceeds of the speci?ed

-48-

 

 






Case Document 3

unlawful activity, as follows:

Filed 03/28/18 Page 49 of 61

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Properties (X621 1)

gm 1% Amount Description

53. May 18, 2016 $1,476,505.00 Website Technologies (X2008) to Cereus
Properties (X6211)

54. May 18, 2016 $264,438.00 Website Technologies (X2008) to Cereus
Properties (X6211)

55. May 31, 2016 $3,171,675.80 Website Technologies (X2008) to Cereus
Properties (X6211)

56. May 31, 2016 $432,961.87 Website Technologies (X2008) to Cereus
Properties (X6211)

57. June 20, 2016 $842,878.00 Website Technologies (X2008) to Cereus
I Properties (X6211)

58. June 30, 2016 $3,076,147.75 Website Technologies (X2008) to Cereus
Properties (X6211)

59. July 27, 2016 $3,252,681.62 Website Technologies (X2008) to Cereus
Properties (X6211)

60. July27, 2016 $438,818.86 Website Technologies (X2008) to Cereus
Properties (X6211)

61. Aug. 16, 2016 $804,250.00 Website Technologies (X2008) to Cereus
Properties (x6211)

62. Aug. 31, 2016 $3,171,264.42 Website Technologies (X2008) to Cereus

 

In Violation of 18 U.S.C. 

-49-

 

 

 






 

Case Document 3 Filed 03/28/18 Page 50 of 61

COUNTS 63-68
(International Promotional Money Laundering)

168. A The factual allegations in Paragraphs 1-167 are incorporated by reference
and re-alleged as though fully set forth?herein.

169. On or about the dates set forth below, each instance constituting a separate
count of this Indictment, in the District of Arizona and elsewhere, defendants LACEY,
LARKIN, SPEAR, BRUNST, and HYER, and others known and unknown to the grand
jury, transported, transmitted, and transferred, and attempted to transport, transmit, and
transfer, a monetary instrument and funds from a place in the United States to and through
a place outside the United States, and to a place in the United States from and through a
place outside the United States, with the intent to promote the carrying on of speci?ed

unlawful activity, as follows:

 

 

 

 

 

 

 

 

 

 

 

 

. Amount Description

63. Mar. 4, 2014 $6,450.00 US. Bank (X1165) to SE. (web developer
in India)

64. Aug. 5, 2016 $5,005,732.86 Ad Tech B.V. (Netherlands) to Cereus
Properties (X6211)

65. Sept, 22, 2016 $2,916,955.00 Ad Tech B.V. (Netherlands) to Cereus
Properties (x6211)

66. Oct. 3, 2016 $354,050.84 Ad Tech B.V. (Netherlands) to Cereus

1 Properties (X6211)

67. Nov. 2, 2016 $2,726,170.00 Ad Tech B.V. (Netherlands) to Cereus
Properties (x6211)

68. Nov. 15, 2016 $351,403.54 Ad Tech B.V. (Netherlands) to Cereus
Properties (x6211)

 

In Violation of 18 use. 1956(a)(2)(A).

-50-

 

 






Case Document 3 Filed 03/28/18 Page 51 of 61

COUNTS 69-93
(Transactional Money Laundering)

170. The factual allegations in Paragraphs 1?169 are incorporated by reference
and re?alleged as though fully set forth herein.

171. On or about the dates set forth below, each instance constituting a separate
count of this Indictment, in the United States and in the District of Arizona and elsewhere,
the specified defendant, and others known and unknown to the grand jury, knowingly
engaged and attempted to engage in a monetary transaction in criminally derived property

of a value greater than $10,000 and is derived from speci?ed unlawful activity, as follows:

 

 

 

 

Count Defendant Date Amount 'Description 
69. LACEY, Aug. 21, $30,000.00 Bank of America (X1793) to
BRUNST 2013 Stewart Title (partial payment
for Sedona property)
70. LACEY, Sept. 13, $62,491.47 BMO Harris to Stewart Title
BRUNST 2013 (partial payment for Sedona
property)

 

71. SPEAR June 11, 2014 $300,000.00 National Bank of Arizona
(X0178) to Spear Family Trust

 

72. SPEAR June 20, 2014 $200,000.00 National Bank of Arizona
(X0178) to TD Ameritrade

 

73. SPEAR Nov. 4,2014 $1,000,000.00 National Bank of Arizona
(X0178) to UBS Financial

 

74. SPEAR May 14,2015 $250,000.00 National Bank of Arizona
(X0178) to Lincoln National
Life

 

75. SPEAR May 26,2015 $50,000.00 National Bank of Arizona

 

 

 

 

 

 

 

(X0178) to Industrial Property

 

-51-

 

 






Case Document 3 Filed 03/28/18 Page 52 of 61

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


76. SPEAR Nov. 3, 2015 $300,000.00 National Bank of Arizona
(x0178) to Ally Bank
77. SPEAR Dec. 1, 2015 $200,000.00 National Bank of Arizona
(x0178) to Wells Fargo
78. SPEAR, Jan. 11, 2010 $133,045.00 Cereus Properties (x6211) to
BRUNST National Bank of Arizona
(x0178) 
79. BRUNST Jan. 26, 2016 $101,974.00 Cereus Properties (X6211) to
Wells Fargo (x4891)
80. LARKIN, Feb. 3, 2016 $1,507.944.00 Cereus Properties (X6211) to
BRUNST Charles Schwab
81. LACEY, Mar. 1, 2016 $1,692,020.00 Cereus Properties (x6211) to
BRUNST Bank of America (X5554)
82. BRUNST Apr. 1, 2016 $220,944.00 Cereus Properties (x6211) to
VVeHsIkugo(x4891)
83. LACEY, June 27, 2016 $397,9500.00 Arizona Bank Trust (x1793)
BRUNST to Fidelity Title (partial payment
for San Francisco property)
84. LACEY, July 20, 2016 $12,859,152.57 Arizona Bank Trust (X1793)
BRUNST to Fidelity Title (partial payment
for San Francisco property)
85. SPEAR July 22, 2016 $50,000.00 National Bank of Arizona
(X0178) to Strategic Storage
Trust 11
86. LACEY, Aug. 2, 2016 $16,243.00 Cereus Properties (x6211) to
BRUNST Wells Fargo (x0495)

 

 

-52-

 

 

 






Case Document 3 Filed 03/28/18 Page 53 of 61

 

 

 

 

 

 

 

87. LARKIN, Oct. 6, 2016 $1,206,356.00 Cereus Properties (X6211) to
BRUNST Charles Schwab (X4693)
88. LACEY, Oct. 6, 2016 $268,016.00 Cereus Properties (X6211) to
BRUNST Arizona Bank Trust (X1967)
89. LACEY, Oct. 6, 2016 $268,016.00 Cereus Properties (X6211) to
BRUNST Arizona Bank Trust (X1972)
90. LACEY, Oct. 6, 2016 $268,016.00 Cereus Properties (X6211) to
BRUNST Arizona Bank Trust (X1986)
91. LACEY, Oct. 6, 2016 $268,016.00 Cereus Properties (X6211) to
BRUNST Arizona Bank Trust (X1991)
92. LACEY, Oct. 6, 2016 $268,016.00 Cereus Properties (X6211) to
BRUNST Arizona Bank Trust (X2014)
93. SPEAR, Oct. 6, 2016 $141,444.00 Cereus Properties (X6211) to
BRUNST National Bank of Arizona
(X0178)

 

 

 

 

 

 

 

In violation of 18 U.S.C. 1957.

-53-

 

 

 






 

Case Document 3 Filed 03/28/18 Page 54 of 61

FORFEITURE ALLEGATION ONE
[18 U.S.C. 981(a)(1)(C) and 28 U.S.C. 2461(c)]

1. Pursuant to Rule 32.2 of the Federal Rules of Criminal Procedure, notice is
hereby given that the United States will seek forfeiture as part of any sentence, pursuant to
Title 18, United States Code, Section 981(a)(1)(C) and Title 28, United States Code,
Section 2461(c), in the event of any defendant?s conviction under Counts 1 through 51 of
this Indictment. Each defendant so convicted shall forfeit to the United States the
following:

a. All right, title, and interest in any and all property, real or personal,
constituting, or derived from, any proceeds obtained, directly or indirectly, as a result of
the offense. Such property includes, but is not limited to, the real property located at the
following addresses:

i. 1100 UNION ST #0700 SAN FRANCISCO CA 94109-2019
ii. ,2043 PLEASANT HILL RD SEBASTOPOL CA 95472?4947
343 PRESIDIO AVE, SAN FRANCISCO, CA 94115
iv. 2755 FILLMORE ST, SAN FRANCISCO, CA 94123
v. 5300 STELLA LANE, PARADISE VALLEY, AZ 85253
vi. 16901 COLEGROVE DR., DALLAS, TX 75248
Vii. 10647 NORTH STATE ROUTE 89A, SEDONA, AZ
493 ZINFANDEL LN, ST HELENA, CA 94574
ix. 5555 N. CASA BLANCA DR, PARADISE VALLEY, AZ 85253
X. 1308 E. 56TH ST UNIT 2, CHICAGO, IL 60637
Such property also includes, but is not limited to, funds held in the following bank
accounts:
i. Prosperity Bank account number 
ii. Compass Bank Account number 
Compass Bank Account number 825

-54-

 

 



Ix.) i?I r?i r?t l?t l?l v?t r?t 


 

Case Document 3 Filed 03/28/18 Page 55 of 61 

iv.

vi.
vii.


ix.

xi.
xii.

xiv.
xv.
xvi.
xvii.

xix.
xx.
xxi.
xxii.

xxiv.

XXV .

National Bank of Arizona Account number 

National Bank of Arizona Account number 

National Bank of Arizona Account number 645

Live Oak Bank Account Number 

Ascensus Broker Dealer Services Account Number 
Ascensus Broker Dealer Services account Number 
First Federal Savings Loan of San Rafael account number 620
Republic Bank of Arizona account number 

Republic Bank of Arizona account number 

Republic Bank of Arizona account number 

Republic Bank of Arizona account number 00

Republic Bank of Arizona account number 

Bank of America Account number 

Bank of America Account number 

Bank of America Account number 42

Bank of America Account number 

San Francisco Fire Credit Union Account Number 23
Ally Bank Account Number 

Branch Banking and Trust Bank account number 
Green Bank Account numb er 

Green Bank Account number 

Plains Capital Bank account number 

Such property further includes, but is not limited to, the following domain names:

i.
ii.


iv.

atlantabackp age.com
backpagebe
backpage.com

backpage.com.br

-55-

 

 






 

Case Document 3 Filed 03/28/18 Page 56 of 61

vi.
vii.


ix.

xi.
xii.
.
xiv.
xv.
xvi.
xvii.

xix.
xx.
xxi.
xxii.

xxiv.
xxv.
xxvi
xxvii.

xxix.




backpage.cz
backpagedk
backpage.ee
backpage.es
backpage?
backpagefr
backpage. gr
backpagehu
backpage.ie
backpage.it
backpagelt
backpage.mx
backpage.net
backpage.no
backpagepl
backpagept
backpage.r0
backpage.si
backpage.sk
backpage.us

bestofbackpage.com
bestofbigcity.com
bigcity.com
chicagobackpage.com
denverbackpage.com

newyorkbackpage.com

?56-

 

 

y-L






 

Case Document 3 Filed 03/28/18 Page 57 of 61

phoenixbackpagecom
sandiegobackpagecom
seattlebackpage.com
tampabackpageicom
b. To the extent such preperty is not available for forfeiture, a sum of
money equal to the total value of the property described in subparagraph 

2. Pursuant to Title 21, United States Code, Section 853(p), as incorporated by
Title 28, United States Code, Section 2461(0), the defendant shall forfeit substitute
property, up to the total value of the property described in the preceding paragraph if, as
the result of any act or omission of the defendant, the property described in the preceding
paragraph, or any portion thereof: cannot be located upon the exercise of due diligence;
has been transferred, sold to or deposited with a third party; (0) has been placed beyond
the jurisdiction of the court; has been substantially diminished in value; or (6) has been
commingled with other property that cannot be divided without dif?culty.

FORFEITURE ALLEGATION TWO
[18 U.S.C. 982(a)(1)]

1. Pursuant to Rule 32.2 of the Federal Rules of Criminal Procedure, notice is
hereby given that the United States will seek forfeiture as part of any sentence, pursuant
Title 18, UnitedStates Code, Section 982(a)(1), in the event of any defendant?s conviction
under Counts 52 through 93 of this Indictment. Each defendant so convicted shall forfeit

to the United States the following: 

a. All right, title, and interest in any and all property, real or personal,
involved in or traceable to any transaction set forth in Counts 52 through 93 of this
Indictment. Such property includes, but is not limited to, the real property located at the
following addresses:

i. 1100 UNION ST #0700 SAN FRANCISCO CA 94109-2019
ii. 2043 PLEASANT HILL RD SEBASTOPOL CA 95472?4947

-57-

 

 

y?L


t??Case Document 3 Filed 03/28/18 Page 58 of 61



iv.

vi.
vii.

ix.

X.

343 PRESIDIO AVE, SANFRANCISCO, CA 94115

2755 FILLMORE ST, SAN FRANCISCO, CA 94123

5300 STELLA LANE, PARADISE VALLEY, AZ 85253

16901 COLEGROVE DR., DALLAS, TX 75248

10647 NORTH STATE ROUTE 89A, SEDONA, AZ

493 ZINFANDEL LN, ST HELENA, CA 94574

5555 N. CASA BLANCA DR, PARADISE VALLEY, AZ 85253
1308 E. 56TH ST UNIT 2, CHICAGO, IL 60637

Such property also includes, but is not limited to, funds held in the following bank

accounts:

i.

ii.

iv.

v.
Vi.

Vii.


ix.

xi.
xii.

xiv.
XV.

xvi.

Prosperity Bank account number 

Compass Bank Account number 873

Compass Bank Account number 825

National Bank of Arizona Account number 178

National Bank of Arizona Account number 

National Bank of Arizona Account number 645

Live Oak Bank Account Number 23

Ascensus Broker Dealer Services Account Number 
Ascensus Broker Dealer Services account Number 
First Federal Savings Loan'of San Rafael account number 620
Republic Bank of Arizona account number 

Republic Bank of Arizona account number 92

Republic Bank of Arizona account number 

Republic Bank of Arizona account number 

Republic Bank of Arizona account number 

Bank of America Account number 

-58?

 

 






 

Case Document 3 Filed 03/28/18 Page 59 of 61

xvii.

xix.
xx.
xxi.
xxii.


xxiv.

XXV .

Bank of America Account number 

Bank of America Account number 

Bank of America Account number 

San Francisco Fire Credit Union Account Number 23
Ally Bank Account Number 

Branch Banking and Trust Bank account number 
Green Bank Account number 

Green Bank Account number 

Plains Capital Bank account number 

Such property further includes, but is not limited to, the following domain names:

i.

ii.

iv.
v.
Vi.
Vii.


ix.

- xi.
xii.

xiv.
xv.

xvi.

atlantabackpagecom
backpagebe
backpagecom
backpagecombr
backpagecz
backpagedk

backpage?es
backpageii
backpage.fr
backpage. gr
backpagehu

backpageie

backpage.it
backpagelt
backpage.mx

-59-

 

 



New tCase Document3 Filed 03/28/18

xvii.

xix.
xx.
xxi.
xxii.

xxiv.
XXV.
xxvi
xxvii.
. 
Xxix.






.

backpagenet
backpageno
backpagepl
backpagept
backpagero
backpagesi
backpagesk 
backpagens
backpage?insider.com
bestofbackpage.com
bestofbigcity.com
bigcity.com
chicagobackpage.com
denverbackpagecom
newyorkbackpage.com
phoenixbackpage.com
sandiegobackpage.com
seattlebackpage.com

tampabackpage.com

b. To the extent such property is not available for forfeiture, a sum of

money equal to the total value of such property.

a Title 18, United States Code, Section 982(b), each defendant convicted under Counts 52
through 93 of this Indictment shall forfeit substitute property, if, by any act or omission of
that defendant, the property described in the preceding paragraph, or any portion thereof,

cannot be located upon the exercise of due diligence; has been transferred, sold to, or

Pursuant to Title 21, United States Code, Section 853(p), as inc01porated by

~60-

Page 60 of 61

 

 



Case Document 3 Filed 03/28/18 Page 61 of 61

deposited with a third party; has been placed beyond the jurisdiction of the court; has been
substantially diminished in value; or has been commingled with other property that cannot
be divided without dif?culty.

A TRUE BILL


FOREPERSON OF THE GRAND JURY
Date: March 28, 2018

ELIZABETH A. STRANGE
First Assistant United States Attorney
District of Arizona

JOHN P. CRONAN
Acting Assistant Attorne General 
Criminal Division, US. epartment of Justlce

5/

KEVIN M. RAPP
DOMINIC LANZA
MARGARET PERLMETER
JOHN J. KUCERA
Assistant US. Attorneys

REGINALD E. JONES

Senior Trial Attorne 
US. Department of Justice, Criminal Division
Child Exploitation and Obscenity Section

-61?