When The Banks Declared War On Backpage

Tony Ortega

Tony Ortega might have tried to sell Backpage to the public as a glorified dating site but the reality, as we’ve been seeing over the course of our investigation into the legal filings, was something far more nefarious.

The plain, undeniable truth is that they were selling women and children to perverts online for profit. Backpage watchers had long been sounding alarm bells about the criminal implications of its business model, now some on Backpage payroll were beginning to speak out in corroboration.

On January 7, 2013, for example, Assistant Operations Manager Joye Vaught was informed by one of Backpage’s own moderators that the company wasn’t diligently pursuing reports of child exploitation, turning a blind eye to welfare underage youths being exploited by the site.

The email read : “ We’ve supposedly been checking them, but some seem to be ignored. They get “marked as read’, but nothing gets done with them. It’s aggravating and irresponsible.”

And it wasn’t just Backpage’s in-house moderators noting the company’s ‘aggravating and irresponsible’ conduct. Months later, Backpage received a letter from the National Center for Missing & Exploited Children recommending the adoption of several specific security measures to prevent the trafficking of children in light of these accusations.

The recommended security measures included common-sense changes like:

(a) Verifying the age and identity of users who submitted adult ads.

(b) Verifying the age and identity of individuals depicted in photographs within adult ads.

(c) Prohibiting the use of anonymous payment sources such as prepaid credit cards.

(d) Requiring users to utilize verified email addresses and telephone numbers.

Backpage, true to its irresponsible reputation, once more declined to follow any of these recommendations. Again they ignored the responsibility they had to the safety and welfare of children, willfully continuing to take advantage of them for the sake of the hundreds of millions of dollars they were raking in.

As Backpage was soon to learn, however, while the warnings of their own moderators could easily be tossed aside, the damning of assessment of a body like the National Center for Missing & Exploited Children would not be so easily swept under the rug.

Indeed, based in part on Backpage’s repeated refusal to adopt recommendations laid forth by the NCMEC, financial institutions were among the first to take proactive steps to thwart the Backpage human sex trafficking ring.

On August 30, 2013, James Larkin, Vice President Scott Spear, CFO John Brunst, Sales and Marketing director Dan Hyer, and CEO Carl Ferrer received an email notifying them that “ Chase [Bank] was no longer accepting transactions from Backpage.com, due to their involvement in human trafficking.”

In response, Ferrer defiantly informed the group that he intended to begin “ giv[ing] users free ads if they complain while we wait on directly transactions to another processor.”

Some people can’t seem to take a hint no matter how many warnings they are given and, as we shall see, making enemies of the banks would come back to bite Backpage in a big way.