Former Backpage Executives Face Sentencing After Testifying in Founder’s Trial

Two former executives of the now-defunct classified site Backpage.com are scheduled to be sentenced Tuesday in Phoenix after pleading guilty to a conspiracy to facilitate prostitution by selling sex-related ads, court filings show.

Prosecutors have recommended probation and restitution for former chief executive officer Carl Ferrer and former sales director Dan Hyer, both of whom admitted guilt in 2018 and later cooperated with investigators by testifying against Backpage founder Michael Lacey at his 2023 trial. The prosecutor’s sentencing memorandum recommends five years of probation and repayment of restitution funds for each man.

Lacey was convicted in 2023 of a single count of international concealment money laundering and sentenced to five years in prison and fined $3 million; he remains free while appealing. Two other former Backpage executives, chief financial officer John Brunst and executive vice president Scott Spear, are serving 10-year sentences following convictions on conspiracy and money laundering charges.

Prosecutors said Backpage’s operators ignored repeated warnings to stop running prostitution ads, including some that involved minors, and cultivated business practices that boosted escort listings. Among the allegations were schemes to offer free ads to sex workers to pull them from competitors and arrangements with third parties in the industry that helped generate content and revenue. Authorities have said Backpage generated roughly $500 million in prostitution-related revenue from its 2004 launch until the government seized the site in 2018.

Ferrer, in his guilty plea, acknowledged that a majority of Backpage’s revenue flowed from escort ads and that company personnel sanitized ad language and removed photos or phrases that might indicate prostitution before republishing content. Sentencing filings from both the prosecutor and Ferrer’s lawyers say his cooperation assisted the government in securing convictions and ultimately contributed to the site’s shutdown.

Hyer’s attorneys said he is remorseful and highlighted his cooperation in prosecutions of other defendants. Court documents describe Hyer’s prior involvement in promotional schemes designed to attract sex workers’ business by temporarily providing free advertising.

Backpage’s operators consistently denied knowingly allowing prostitution advertisements and said the company made efforts to remove inappropriate content by assigning staff to moderate listings and building automated tools to screen posts. Their lawyers argued that content posted on the site received First Amendment protection.

The case’s legal history includes a 2021 trial for Lacey that ended in a mistrial after a judge concluded prosecutors had made too many references to child sex trafficking in a case where no trafficking charges were brought. Co-defendant James Larkin, who had co-founded the Phoenix New Times with Lacey and later shared ownership of Backpage, died by suicide in 2023 just before the second trial of the site’s operators was to begin. Lacey and Larkin had earlier sold weekly newspapers such as the Phoenix New Times and The Village Voice but retained Backpage until its 2018 seizure.

The seizure of Backpage prompted debate about law enforcement access to online platforms. A U.S. Government Accountability Office report published in June 2021 found that the FBI’s ability to identify victims and sex traffickers decreased after the government’s seizure because investigators had been familiar with the site and Backpage had generally been responsive to information requests prior to its closure.

Sentencing outcomes for Ferrer and Hyer will follow federal sentencing procedures and consider both their guilty pleas and their documented cooperation. The court’s rulings could affect restitution amounts and any additional terms the judge determines appropriate under federal guidelines. Appeals and post-conviction procedures remain possible for other defendants in the sprawling case that has highlighted tensions between online content moderation, free speech claims and criminal liability for platform operators.