Backpage.com is accused of money laundering and facilitating prostitution with Crypto. The FBI seized and closed the site on Friday 6 April. “Backpage” was seized by the US Department of Justice on Friday 6 April. The site has been the target of legal oversight for years, as it had earned its reputation as an online center for illegal sex work.
The reasons for the Justice Department’s actions were presented yesterday in a list of laundry items in a 93-point federal indictment, which included allegations of “facilitating prostitution using a structure in interstate or foreign trade” and various types of money loundering.
Visa and Mastercard payment processors stopped using their services on the site in 2015 for what they called “moral, social and legal reasons”. As a result, the use of Bitcoin has increased significantly on the site and the sex workers who have used Backpage have started using crypto en masse in a movement that has become known as “The Backpage Effect”.
The defendants used “Virtual currencies … and the anonymity of the Internet” to cover the trades
The defendants in the case are the co-founders Michael Lacey and James Larkin, who the head of the IRS Criminal Investigation John D. Fort has called “the minds” of the operation. FBI agents recently broke into Lacey’s home; in 2016, both men were arrested and charged with conspiracy to commit exploitation.
Fort explained that the “two serious financial crimes of two men like money laundering” were committed “at the expense of women and children”. He went on to say that men used “virtual currencies … and the anonymity of the Internet” to hide their actions.
The accusation reads: “by 2008, if not before, the Backpage defendants were aware that the vast majority of the” adult “ads of the site involved prostitution. However, BackPage defenders have made a financial decision to continue viewing these ads. ”
TechCrunch reported that Craigslist made the decision to remove its personal ad platform after the recent Stop Enabling Sex Traffickers Act (SESTA). Reportedly, Backpage has decided not to remove advertising that urges sex to stay ahead of the competition with Craigslist and other personal advertising platforms.
A Newsweek report presented the other side of the story: the simple fact that sex workers who have relied on the site as the main source of income have been severely affected by the closure.
A prostitute known as Mandie told the publication that she was “devastated and terrorized” at closure, “because people will die. I know that it sounds frank and perhaps a little alarmist, but it is not. The most marginalized of us will die. Trans people, black people, poor people are going to die “.
However, the US government sees things differently. Chief Inspector of Posts Guy Cottrell commented that “by recycling the illegal profits of a company, Backpage has perpetuated the exploitation of the victims and continued to finance their business”.