Backpage.com Founder Michael Lacey Sentenced to 5 Years in Prison, Fined $3M for Money Laundering

Michael Lacey, one of the founders of Backpage.com, was sentenced to five years in prison and fined $3 million for money laundering. The case is part of a larger investigation into allegations that Backpage.com was involved in promoting and profiting from prostitution through online ads.

Lacey, 76, was found guilty of one count of money laundering last year, but the jury couldn’t reach a decision on 84 other charges related to facilitating prostitution and laundering money. Although many of these charges were later dropped due to insufficient evidence, Lacey still faces about 30 other charges.

Authorities say Backpage.com made $500 million from prostitution-related ads from 2004 until it was shut down by the government in 2018. Lacey’s lawyers argued that he was focused on running a newspaper business and wasn’t involved in the day-to-day operations of Backpage.

However, during the sentencing, the judge told Lacey that he knew about the illegal activities on the site and did nothing to stop them.

Two other Backpage executives, John Brunst and Scott Spear, were also sentenced to 10 years in prison for their roles in the scheme. Prosecutors said the three were driven by greed and misled the public and law enforcement about the true nature of their business.

Backpage employees allegedly reached out to prostitutes and offered them free ads, and the site even had deals with other platforms to promote these ads. Despite some efforts to hide illegal activity, authorities say these measures were meant to cover up the true purpose of the site.

Even though Lacey and his partner sold their interest in Backpage in 2015, prosecutors said they still maintained control over the site.