Indictment: Backpage.com gave prostitutes free ads

PHOENIX — A new indictment in Arizona against operators of Backpage.com alleges the classified ad site gave free ads to prostitutes and cultivated arrangements with others who worked in the sex trade to get them to post ads with the company.

The indictment filed Wednesday repeats allegations in an initial round of charges and adds six new money laundering charges against founder Mike Lacey and 50 charges of facilitating prostitution against chief financial officer John Brunst.

A total of seven people were charged in an indictment in late March alleging the site ignored warnings to stop running prostitution ads, sometimes involving children, after the site brought in $500 million of prostitution-related revenue since its inception in 2004.

The new indictment says Backpage.com employees would identify prostitutes through Google searches then call and offer them a free ad. It says the company used the strategy in Nashville and other cities and planned to expand such efforts in Los Angeles and New York.

The document also said the classified site had a business arrangement in which it would place ads on another site that lets customers post reviews of their experiences with prostitutes.

Prosecutors say Backpage.com was warned by an internet safety firm in April 2011 about the phrase “New In Town,” a code term used by pimps who shuttle children to locations where they don’t know anyone and can’t get help.

“Nevertheless, Backpage continued for the next seven years to permit ads using the phrase ‘New In Town’ to be published on its website,” the indictment said.