The former co-owner of the tabloid Phoenix New Times, Michael Lacey, was sentenced to five years in prison on Wednesday for laundering money from backpage.com, a site he founded and ran that was accused of prostitution and sex trafficking of minors. His co-owner, Jim Larkin, killed himself a few days before the second trial was to begin in 2023 (the first trial ended in a mistrial). The New Times is known for regularly running articles attacking conservatives in politics that are strategically placed next to articles about pedophiles and murderers.
Scott Spear and John “Jed” Brunst, former executives with Backpage, were sentenced to 10 years each for numerous crimes. “The defendants and their conspirators obtained more than $500 million from operating an online forum that facilitated the sexual exploitation of countless victims,” said Principal Deputy Assistant Attorney General Nicole M. Argentieri, head of the Justice Department’s Criminal Division in a press release. “The defendants thought they could hide their illicit proceeds by laundering the funds through shell companies in foreign countries. But they were wrong.”
Jurors convicted Lacey (pictured above) on one charge: laundering money from Backpage into a trust in Hungary for his sons. Prosecutors alleged that he tried to hide $16.5 million in profits from the government’s seizure. He was also fined $3 million by U.S. District Court Judge Diane Humetawa, who was appointed to the bench by former President Barack Obama.
Lacey co-founded the New Times with Larkin in 1970. The New Times was so successful after its launch in Arizona in 1970 that Lacey and Larkin expanded it to other cities around the country, eventually taking over The Village Voice in New York. However, the pair expanded operations to Backdoor in the early 2010s as journalism became less lucrative.
Testimony from Eryka Brewster, a young woman who was trafficked as a child, helped lead to a conviction of the former site’s CEO, Carl Ferrer, her pimp, and the ongoing prosecution against Lacey. She told The Arizona Sun Times a year ago, “The only way my trafficker could make any money off of me was through a Backpage ad; he worked nowhere else but there.”
Prosecutors laid out a case that Backpage published disguised ads for prostitution, which made up to 90 percent of the site’s revenue. They said in the DOJ press release, “From September 2010 through its seizure by the United States in April 2018, Backpage was the internet’s leading forum for prostitution ads.” The indictment quoted a line Lacey wrote in a draft op-ed that said, “for the very first time, the oldest profession in the world has transparency, record keeping and safeguards.”
Ferrer pleaded guilty in 2018 to sex trafficking and money laundering charges. He testified against Lacey and said that the “vast majority of the revenue” from Backpage was from the escort section ads, which Ferrer described as “prostitution ads.” He said Backpage’s attempts to assist law enforcement in investigations were “a public relations stunt.”
According to AZCentral, former New Times journalists submitted letters to Humetawa praising Lacey for defending the “powerless,” which she found “ironic” since the trafficked victims were the powerless individuals.
Lacey, Spear, and Brunst, who are all in their 70s, must turn themselves in by September 11. Attorneys for the men said they will appeal. Prosecutors intend to charge Lacey with additional crimes, up to 34 counts.
In May, The New Times launched what it said was its first “membership drive” to raise money. It said it intends to use the money for “holding law enforcement accountable” and covering political campaigns, among other things. Its editor-in-chief, Matt Hennie, is an LGBTQ activist who wrote articles exclusively about LGBTQ in 2020. There is nothing in the Wikipedia entry for The New Times about the prosecution of Lacey and Larkin, although they are named as the founders.
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Rachel Alexander is a reporter at The Arizona Sun Times and The Star News Network. Follow Rachel on Twitter / X. Email tips to [email protected].
