How outsourcing to India gave prosecutors a window into Backpage operations


CLOSE, a classified advertising website that faced persistent allegations of profiting from illegal prostitution, was shut down by the U.S. government Friday as authorities reportedly brought criminal charges against seven of those involved in operating the site.

PHOENIX —, the website that federal prosecutors contend was intentionally and illegally designed to help promote ads for prostitution, seemed designed to evade scrutiny.

For years, the website whose founders and employees were indicted Monday on federal charges of aiding prostitution had claimed that it policed its adult ads to ward off such illegal activity.

However, company officials also contended that those policies were not written down. The website’s lawyer, Liz McDougall, told U.S. Senate investigators that supervisors passed down policies to employees by word of mouth.

In short, she contended that investigators had nothing to look at that would help them understand how Backpage attempted to keep ads that contributed to human trafficking off its website.

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But Senate investigators learned that, for a time, Backpage outsourced its moderation work to employees in India. Investigators asked that company for emails it exchanged with Backpage.

Those emails between Backpage and supervisors of the India employees laid out specific rules on what words and images were allowed on the website and which would be banned. The emails also discussed the reasoning behind why some terms were allowed and others were not.

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The indictment lists 25 ads published after April 2016 that contain the term GFE. Each one constitutes a separate charge of facilitating prostitution.

In addition to the prostitution charges, Lacey and Larkin also were charged with financial crimes, because prosecutors allege that they and two other executives who also held corporate positions at New Times, Scott Spear and John “Jed” Brunst, used an extensive network of shell companies and foreign banks as repositories of Backpage money. 

Also charged in the indictment were Dan Hyer, the Backpage sales and marketing director, and Andrew Padilla and Joye Vought, two people who sent several emails to the team of moderators that would comb ads and scrub them clean of words indicative of prostitution.

The federal indictment seemed to track, in part, the report U.S. Senate released in January 2017 that concluded Backpage was knowingly aiding prostitution activity, some involving underage girls.

When that report was released, Sen. Claire McCaskill, D-Mo. and a former county prosecutor, said the report contained a treasure trove of evidence. She encouraged prosecutors, including U.S. attorneys, to use the emails as a road map.

“I am confident that there is sufficient evidence here to hold some of the people responsible for this accountable in ways that have been very frustrating to the families,” she said at the hearing.

The next month, lawyers for Backpage asked for a delay in a civil trial in Washington. The reason cited in their filing was that Backpage was the subject of a criminal grand jury investigation in Phoenix.

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The U.S. Senate started investigating Backpage in April 2015, as part of a look into how websites were involved in the prostitution trade.

Backpage had long contended it did all it could to stop ads that offered money for sex or other illegal activity.

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The adult ads on Craigslist had been free, but Craigslist started charging for the ads at the suggestion of law enforcement who thought credit-card numbers could help them trace possible perpetrators, McDougall testified. The website similarly required people posting adult ads to verify a working phone number.

The website also hired lawyers “at considerable expense” to moderate posts, according to McDougall’s prepared congressional testimony.

Those steps resulted in many of the adult ads migrating to Backpage. In a 2009 entry on its blog, Craigslist noted that a sampling of ads on Backpage were far more graphic and explicit than the ads found on Craigslist.

Craigslist closed its “adult services” category in September 2010, bowing to the public pressure.

According to internal email, Carl Ferrer, the chief executive of Backpage, said he expected a surge of advertisements to come to the Escorts section of Backpage. He also wrote that he feared harsh scrutiny from law enforcement.

“It is an opportunity for us,” Ferrer wrote. “Also a time when we need to make sure our content is not illegal.”

That month, Backpage contacted El Camino Technologies, a California company that could hire moderators in India.

Initially, Backpage hired six employees in India for $3.95 an hour, according to emails. They worked shifts around the clock.

El Camino Technologies did not respond to an email seeking comment.

An October 2010 email to El Camino spelled out rules for pictures on Backpage ads:

“We allow full nudes for men and women,” the guidelines said. “However, we do not want to display any explicit images of genitalia. … Our standard is playboy and not porn.”

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The guidelines also said moderators should reject ads “that suggest sex for money.” It listed three dozen explicit or coded terms that should be banned. 

Andrew Padilla, the operations manager for Backpage, thought the India-based moderators initially were too harsh with their edits, according to the emails. Padilla told Monita Mohan, an executive with the company that coordinated the India employees, that the word “sexy” was OK and offered more detailed guidance on nudity, saying photos of a centered thong or g-string were allowed. shareholders in custody on pimping charge
► October 2016: CEO charged with pimping in California

In late October 2010, Backpage altered its policies, according to an email sent to staff, banning photos of bare bottoms and the words “GFE” and “PSE,” which stand for “girlfriend experience” and “porn star experience.”

According to the indictment, those terms were defined in the email as being indicative of a “sex act for money.”

Also banned were pricing for increments less than an hour. The email said new guidelines on female frontal nudity would follow.

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Padilla, the operations manager, said ads that violated the new rules would be edited. Warnings would be sent to the people who created the ads

“We have to be fair to the users and give them time to adjust,” he wrote.

In February 2011, Padilla wrote Mohan that some customers who had been restricted on the site before were being given a “clean slate.” He said he expected this would increase the number of ads that needed to be edited.

He also wrote that the staff should go slightly easier on some borderline violations of policy.

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“I realize that this more lenient policy can’t necessarily be easily conveyed to our moderation crews,” he wrote. “But I feel the general attitude change should be communicated in some form.

“Put succinctly, moderators should err on the side of the user,” he wrote.

By 2012, Ferrer and the company that coordinated with the moderators in India were exchanging emails that discussed what words should be allowed. A group of India moderators suggested terms that were similar to the ones banned.

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A spreadsheet attached to the email contained definitions for some terms, making plain what certain terms meant.

For example, “car date” was defined as, “The act of prostitution, occurring in a vehicle. Some examples: It appears as before that we have a woman car dating in our neighborhood.”

Sometime in 2012, according to the Senate report, Backpage ended its contract with the moderators in India.

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Three years later, Senate subcommittee investigators asked the company about its contract with Backpage.

That company said its contract with Backpage was the first time it ever had that dealt with moderating escort ads, according to the subcommittee’s report. And that the company had not had a similar client since.

And, yes, they did still have the emails.

Follow Richard Ruelas on Twitter: @ruelaswritings

Note: Portions of the following indictment have been redacted to remove some of the more vulgar phrases of a sexual nature, websites that purport to advertise prostitution and specific street addresses.


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