CEO Arrested for Pimping

By George Khoury, Esq. on October 07, 2016 | Last updated on March 21, 2019

The CEO of a popular classified ads website,, was arrested on Thursday on felony pimping of a minor, pimping and conspiracy to commit pimping, charges. CEO Carl Ferrer was arrested in Texas based upon the charges that California Attorney General Kamala Harris filed in California. The complaint alleges that Ferrer and have profited from the escort advertisements that get posted on by individual prostitutes, as well as escort services that are engaged in human trafficking.

Currently, Ferrer is being held on a $500,000 bond and will soon be extradited to California to face criminal chrages. Law enforcement is also currently investigating Ferrer and's offices in Texas. At this point, it is unclear whether Ferrer will also faces charges in a Texas court. If should also be noted, the two controlling shareholders of the site, Michael Lacey and James Larkin, currently have warrants issued for their arrest on similar charges.

The World's Largest Online Brothel has gained notoriety as the website that escort services use to advertise their services. Despite the fact that escort services are actually legal businesses, all too frequently the services are operated as a poor cover for prostitution. In the criminal complaint against Ferrer, a 15 year old has come forward to explain that they were forced into sex work at age 13 and has had ads posted on AG Harris explains that was purposefully designed to profit off prostitution, and investigations have discovered that numerous advertisements displayed victims of the sex trade, many of whom were minors.

The website makes money by selling advertising space to escort services and other services and individuals. According to the criminal charges, the company made $3.1 million in revenue in just one week selling the sex ads. While the site sells ad space in non-escort/sex related categories, 99% of the site's revenue comes from the escort services ads.

Are CEOs Really Criminally Liable?

Under the law, there is a doctrine known as the Responsible Corporate Officer. Under this doctrine, corporate officers can be held liable for criminal acts committed by their company that they either knew, or should have known, were occurring. Generally, where a law is for the general welfare of the public, like nearly all criminal laws are, then a corporate officer can be held liable.

Additionally, where the law in question imposes strict liability, a corporate officer can be held liable even if they had no knowledge what-so-ever of the violation.

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