WASHINGTON, D.C. — U.S. Senator Rob Portman (R-OH) delivered remarks on the Senate floor today to discuss Tuesday’s Permanent Subcommittee on Investigations (PSI) committee hearing on “Backpage.com’s Knowing Facilitation of Online Sex Trafficking.” Portman, who serves as Chairman of PSI, led an 18-month long bipartisan investigation into the scourge of online sex trafficking along with Senator Claire McCaskill (D-MO). The widely-praised investigation produced a stunning report detailing how Backpage knowingly facilitated criminal sex trafficking of vulnerable women and underage girls and covered up evidence of these crimes in order to increase its own profits. “Backpage,” said Portman, “did nothing to stop this criminal activity. They facilitated it. Knowingly.”
Transcript of the speech can be found below and a video can be found here.
“I rise today during Human Trafficking Awareness month to talk about the scourge of human trafficking and specifically about an investigation that the Senate has just concluded that matters to every single state represented in this chamber and to every American. We’re told now that human trafficking, including sex trafficking, is a $150 billion-a-year industry. This makes it the second biggest criminal enterprise in the world behind the drug trade. Unfortunately, it’s happening in all of our states, including in my home state of Ohio. And it’s growing as a problem. A couple of weeks ago, two people were arrested in my hometown of Cincinnati in connection with sex trafficking. Police charged a woman with luring an underage girl to commit a sex act with a 56-year-old man. That was two weeks after police in Blue Ash, Ohio, just up the road, broke up what they said was a sex trafficking ring in a hotel. Police said that two men and two women rented two rooms at a hotel paying cash, and forced four different women to perform sex acts. The women were given crack cocaine and heroin presumably to keep them dependent on their traffickers.
“This is what I’m hearing back home a lot when I talk to victims of sex trafficking. Typically drugs are involved. In Ohio it’s usually heroin. These cases are alarming and unfortunately we have reasons to believe that the problem is getting worse, not better. The National Center for Missing and Exploited Children, really the expert on this issue, particularly of kids who get involved in sex trafficking, reports an 846 percent increase in reports of suspected child sex trafficking from 2010 to 2015. That’s an over 800 percent increase just in those five years. This spike the organization found to be ‘directly correlated to the increased use of internet to sell children for sex.’ So it’s kind of the dark side of the internet, isn’t it? What I’m told sometimes by survivors of trafficking is they say Rob, this has moved from the street corner to the cell phone. There’s widespread evidence that sex trafficking is increasingly doing that all over our country.
“In order to confront this problem, as Chairman of the Permanent Subcommittee on Investigations along with my colleague and Ranking Member Senator Claire McCaskill, I opened a bipartisan investigation into sex traffickers and their use of the internet. The investigation began about two years ago. The National Center for Missing & Exploited Children says that nearly three-quarters, 73 percent, of all suspected child sex trafficking reports it receives from the general public through its cyber tip line are linked to one website, a single website. That website is called Backpage.com. According to leading anti-trafficking organizations including Shared Hope International, ‘service providers working with child sex trafficking victims have reported that between 80 percent and 100 percent of their clients have been bought and sold on Backpage.com.’ Eighty to 100 percent of their clients have been bought and sold on Backpage.com. That’s consistent with everything I’ve heard when I’ve been back home and spoken and met with sex trafficking survivors.
“Backpage now operates in 97 countries, 934 cities worldwide and is valued at well over half a billion dollars. According to an industry analysis in 2013, eight out of every ten dollars spent on online commercial sex trafficking advertising in the United States went to this one website, Backpage. Others, by the way, have chosen not to engage in this. There have been a number of cases across the country including in Ohio where Backpage.com was used by traffickers to sell underage girls for sex. Last spring, in my home state of Ohio, a man, who by the way has nine children of his own, was sentenced to 12 years in prison for trafficking four underage girls who had run away from home in Akron and in Canton, Ohio. He kept them locked in a hotel, supplied them with drugs like marijuana, heroin, ecstasy, and sold them for sex on Backpage.com. When he was arrested he was found with more than 8,000 bags of heroin.
“Just a week later, a man from Fort Wayne, Indiana was charged with human trafficking and child prostitution after he was arrested on his way to Ohio. His intention, police say, was to traffic a 14-year-old girl who he had met on Facebook, raped, and whom he planned to sell on Backpage.com.
“Backapage says it ‘leads the industry’ in its screening of advertisements for illegal activity. In fact, Backpage’s top lawyer described their screening process as the key tool for disrupting and eventually ending human trafficking via the World Wide Web. But despite these boasts, this website and its owners consistently have refused to cooperate with our investigation and with other investigations relating to lawsuits around the country. With regards to our situation, we subpoenaed them for their documents and they still refused to provide the documents to testify. As a result, as my colleagues will remember, this body the United States Senate, for the first time in more than 20 years, voted unanimously to pass a civil contempt citation to require them to supply the documents and come forward with this information. In August, a federal court order rejected Backpage’s objection to that subpoena and compelled the company to turn over the subpoenaed documents to the Subcommittee. Backpage appealed that, asked for a delay in that order. They took it all the way to the Supreme Court of the United States. But their request was rejected.
“Since then, the Subcommittee has been able to review the documents that were submitted: over one million documents including emails and other internal documents. What we found was very troubling to say the least. After reviewing the documents, the Subcommittee published a staff report on Monday of this week that conclusively shows that Backpage has been more deeply complicit in online underage sex trafficking than anyone imagined.
“We reached three principal findings. First, that Backpage has knowingly covered up evidence of criminal activity by systematically editing its so-called adult ads. Second, that Backpage knows that it facilitates prostitution and even child sex trafficking. Third, despite the reported sale of Backpage to an undisclosed foreign company in 2014, taking them outside of the U.S., the true owners of the company are the founders, James Larkin and Michael Lacey and Carl Ferrer, their CEO.
“First, the editing of ads. Our report shows that Backpage has knowingly covered up evidence of crimes by systematically deleting words and images suggestive of illegal conduct, including of child sex trafficking. That editing process sanitized the content of millions of advertisements in order to hide important evidence from law enforcement.
“In 2006, Backpage executives instructed staff to edit the text of adult ads—not to take them down, but to edit them–which is exactly how they facilitated this type of trafficking including child sex trafficking. By October 2010, Backpage executives had a formal process in place of both manual and automated deletion of incriminating words and phrases in ads.
“Backpage CEO Carl Ferrer personally directed his employees to create an electronic filter to delete hundreds of words indicative of sex trafficking or prostitution from ads before they were published.
“Again, this filter did not reject ads because of the obvious illegal activity. They only edited the ads to try and cover them up. The filter did not change what was advertised, only the way it was advertised. Backpage did nothing to stop this criminal activity. They facilitated it. Knowingly.
“Why did they do it? Backpage executives were afraid they would erode their profits. It’s a very profitable business. In Ferrer’s words, they were afraid they would ‘piss off a lot’ of customers.
“What terms did they delete? Beginning in 2010, Backpage automatically deleted words including ‘lolita,’ referencing the 12-year-old girl in a book sold for sex, ‘teenage,’ ‘rape,’ ‘young,’ ‘little girl,’ ‘teen,’ ‘fresh,’ ‘innocent,’ ‘school girl,’ and even ‘amber alert’—and then published the edited versions of the ads to their website. Backpage also systematically deleted dozens of words related to prostitution.
“This filter made these deletions before anyone at Backpage even looked at the ad. When law enforcement officials asked for more information about suspicious ads—as they have routinely done—Backpage had already destroyed the original ad posted by the trafficker, and the evidence was gone. So this notion that they were trying to help law enforcement is in the face of the fact that they actually destroyed the ads that had the evidence.
“We will never know for sure how many girls and women were victimized as a result. By Backpage’s own estimate, the company was editing 70 to 80 percent of the ads in the adult section by late 2010. Based on our best estimate, this means that Backpage was editing more than half a million ads every year. Internal emails indicate that the company was using the filter to some extent as late as April 2014. We simply don’t know if they are still using a filter.
“Eventually, Backpage reprogrammed its filters to reject some ads if they contained certain egregious words suggestive of sex trafficking. But the company did this by coaching its customers on how to post ‘clean’ ads to help facilitate the criminal conduct of these traffickers. So they did reject some ads, but then they went back to the customer to say this is how you could do it better. For example, starting in 2012, a user advertising sex with a ‘teen’ would get the error message: ‘Sorry, ‘teen’ is a banned word.’ With a one-word change to the ad, the user would be permitted to post the same ad with the same offer.
“In October 2011, Backpage CEO Carl Ferrer directed his technology consultant to create an error message when a user entered an age under 18 years old. Just like with the word filter, the customer could just enter a new age and the ad would post.
“With regard to ownership, our investigation revealed that, acting through a series of domestic and international shell companies, Backpage’s founders lent their CEO Carl Ferrer more than $600 million to buy the website. While Ferrer is, on paper, the owner of Backpage, Backpage’s previous owners retain near-total debt equity in the company, continue to reap Backpage’s profits in the form of loan repayments. They can also exercise control over Backpage’s operations and financial affairs pursuant to the loan and to other agreements. The elaborate corporate structure under which Ferrer purchased Backpage through a series of foreign entities appears to provide absolutely no tax benefit based on their accountants information to us and serves only to obscure Ferrer’s U.S.-based ownership.
“Based on all of these findings it is clear that Backpage actively and knowingly covered up criminal sexual activity, sex trafficking that was taking place on its website, all in order to increase its profits at the expense of the most vulnerable among us.
“Backpage has not denied a word of these findings. Instead, several hours after our report was issued, the company closed what they call their adult section. They closed it down. Frankly, this just validates our findings. The National Center for Missing and Exploited Children said this about Backpage’s closure of its ‘adult’ site an hour after it had been closed: ‘as a result [of this closure], a child is now less likely to be sold for sex on Backpage.com.’
“No one is interested in shutting down legitimate commercial activity and speech, but we do want to put a stop to criminal activity.
“I want to thank Senator McCaskill and her staff for their shoulder-to-shoulder work with my team on the Permanent Subcommittee on Investigations on this bipartisan investigation. I am also grateful to the members of the full Committee and the Senate as a whole for unanimously supporting us as we pursued the enforcement of a subpoena against Backpage.com.
“We’re not done. In the weeks and months ahead, I intend to explore whether potential legislative remedies are necessary and appropriate to end this type of facilitation of online trafficking.
“At a hearing on the report on Tuesday, the Backpage CEO and other company officials plead the Fifth Amendment, invoking their right against self-incrimination – rather than respond to questions about the report’s findings. The Subcommittee also heard powerful testimony from parents whose children had been trafficked on Backpage. One mother talked about seeing her missing daughter’s photograph on Backpage.com, frantically calling the company to tell them that that was her daughter and to please take down the ad. Their response? ‘Did you post the ad?” Her response? ‘Of course I didn’t post the ad, that’s my daughter, please take it down.’ Their response? ‘We can only take it down if you paid for the ad.’
“I urge my colleagues to join me in this effort to ensure that does not happen again. What has happened to these kids is not just tragic; it’s evil. I urge my colleagues to join me in reforming our laws so that they work better to protect these children. Mr. President, thank you. I yield back my time.”
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