Emotional Senate Hearing Finds Backpage.com Complicit in Underage Sex Trafficking as Victim’s Families Testify

— -- “Those children were sold, and they simply tried to sanitize it. That, ladies and gentlemen, is the definition of evil”, said Sen. Claire McCaskill, glaring at the five company executives sitting in front of her.

Jan. 10 was a day of reckoning on Capitol Hill for the controversial classified site Backpage.com, as the Senate Permanent Subcommittee on Investigations released a new report saying that Backpage had knowingly facilitated underage trafficking on its site by actively editing ads posted in the “adult services” section. The website’s top executives were subpoenaed to attend a hearing where the Subcommittee, led by Sen. Rob Portman, R-Ohio, and McCaskill, D-Missouri, laid out their findings, which were based on over a million pages of internal company documents.

For parents Tom and Nacole, this was a day they dreamed would come. Their daughter, who ABC News is calling "Natalie," was repeatedly sold for sex on Backpage.com when she was only 15 years old.

“They took everything from my little girl,” said Tom, who asked that ABC News not use his family’s surname. Tom and Nacole traveled halfway across the country to testify at this Senate hearing, hoping that sharing their story may lead to Backpage being held accountable.

Based in Dallas, Backpage.com is a basic classifieds ad website where people can sell cars, furniture and other items, but the vast majority of their revenue comes from their racy adult section, with categories like “escorts” and “body rubs” -- technically legal services that law enforcement describes as a thinly veiled code for prostitution.

For over a year, ABC News “Nightline” has been conducting an investigation into the problem of underage sex trafficking through ads on Backpage.com and the efforts to stop it. “Nightline” first met Tom, Nacole and their daughter Natalie last spring. Natalie ran away from home at age 15, and ended up falling into the hands of a pimp. She says she was forced into prostitution over 100 times, and believes that Backpage.com made it possible for her pimp to sell her for sex over and over again.

“It’s simple. It’s too simple” she said. “[Backpage] asks if you’re eighteen or older. I mean a simple yes click was about as far as that went.”

The U.S. Senate has been investigating underage trafficking on Backpage for years and this week, the hearing marked a major breakthrough.

The Subcommittee found that Backpage wasn’t just hosting adult ads people posted on their site, it was actively editing them -- erasing words that would indicate underage trafficking. Through their automatic word filtering system, the site would erase terms like “Lolita, “Little Girl” and even “Amber Alert” from ads posted in the ‘adult’ section. They would then post the "cleaned up" ads to the site anyway.

“The fact that these terms were stripped out through this screening process does not mean that that girls age was magically changed," Sen. Portman told Backpage CEO Carl Ferrer during the hearing. “In fact, what you have done, of course, is to cover up the fact that many underage girls were sold on your site, making it harder for law enforcement, parents and committed aid groups to find those kids who need help.”

One by one, Ferrer, co-founders Jim Larkin and Mike Lacey, and other Backpage executives refused to testify at the hearing. On their social media accounts, Backpage called the Senate investigation a violation of their First Amendment rights.

Backpage’s argument is based on a law called the Communications Decency Act, or CDA. The law protects all internet hosting companies, including Backpage, from being held legally responsible for what users post on their websites.

“[The law] protects freedom of speech on the internet,” explained ABC News senior legal correspondent Sunny Hostin. “If you have someone selling a stolen car on your website and you don’t know that the car is stolen, you are not responsible for the selling of a stolen vehicle.”

In the past, many underage girls who say they were trafficked on Backpage have tried suing the site. But so far, nearly every lawsuit has been dismissed under the CDA. However, many believe the Senate’s findings could mean that Backpage would no longer be protected by this law because they engaged in actively changing content.

“I think it potentially means liability," Hostin said. "When you proactively, and actively decide to filter out certain terms, that’s a game changer because you’re talking about active participation."

Just hours before the hearing, Backpage shut down its entire adult services section, replacing the pages with a banner saying, “The government has unconstitutionally censored this content.”

“In terms of their action last night to shut down their adult section… obviously that was a vindication of our report. And it was not censorship. No one told them to do that,” Portman told “Nightline.”

Backpage has repeatedly claimed that they are part of the solution, not the problem. The company told ABC News in a previous statement that it employs moderators who diligently screen ads to stop underage trafficking on its site. They added that they have voluntarily undertaken a multi-tiered "policing system to prohibit and report attempts at human exploitation and the advertisement of prostitution" that screens for words and phrases that might "suggest illegal activity."

The company also said it actively cooperates with law enforcement and reports suspicious ads to the National Center for Missing and Exploited Children, or NCMEC.

In 2012, their attorney Liz McDougall told “Nightline,” that “online human trafficking exists… and the best tools to fight it are online, and Backpage.com is currently one of the very best tools to fight it.”

But NCMEC Senior Counsel Yiota Souras takes issue with Backpage’s claim. “I don't think you can be in the business of providing basically an online bazaar for escort ads that includes the purchase and sale of children for sex, and say that you are online to help fight the problem” she said.

Backpage, which was owned by Village Voice media until 2012, was sold to an “unnamed Dutch holding company” in December 2014, according to news articles at the time. It was later revealed that this mysterious holding company was owned by Ferrer. “Nightline” discovered that he seemed to be running several similar websites from Amsterdam, like NakedCity.com and EvilEmpire.com. “Nightline” also discovered he was running a site called “Cracker” that was extremely similar to Backpage and available almost everywhere except the United States.

Ferrer has declined “Nightline’s” repeated requests for interview, and when we tracked Ferrer to a classified ad industry conference in Amsterdam last year, he again refused to speak with us.

One former Backpage employee agreed to speak with “Nightline" under the condition that her identity not be revealed. Her account echoed the testimony of other employees interviewed for the Senate report. Her job was to moderate ads to make sure they didn’t contain pictures or certain terms indicating prostitution or underage trafficking.

“The way they described the job as a moderating is that we would be monitoring ads that came through the site for our adult content section,” she said. “The ads were basically, ‘Hey come have a good time with honey… ‘no rain coats,’ would be code word for ‘no condoms… ‘in town for one night only, come see me.’”

“And these ads would be so cheap that they would post them constantly,” she continued. “So if the ad did get deleted, they would take $5 and post five more ads of the same one. So it becomes really frustrating because you know you just deleted this ad and 10 minutes later, you’re seeing it again.”

At the Senate hearing, both Tom and Nacole took the witness stand to tell their story. “I can only tell you that when we finally got Natalie back for good, months later, the young girl we found wasn't the same Natalie that had left our home months earlier,” Nacole testified.

“In my mind, it’s simple” Tom said. “What happened to my daughter on Backpage.com is criminal.”

At the hearing, Souras told "Nightline" that the hearing was "a game changer." "I think it lays bare [Backpage’s] level of knowledge about what they were dealing with. And how they chose to deal with criminal acts-- the selling of children for sex,” she said.

As far as Backpage’s self-imposed shutdown, Souras is skeptical. “Who knows what that means, who knows if they’ll be back up tomorrow,” she said.

In fact, “Nightline” discovered that very quickly after Backpage’s adult section was shuttered, ads began springing up in the ‘men seeking women’ dating section of the site that looked very similar to the ads that were usually posted in the escort section.

Some sex trafficking groups have spoken out against Backpage’s shutdown. Dr, Lois Lee, the founder and president of Children of the Night, said in a statement that Backpage “was a critical investigative took depended on by America’s vice detectives and agents in the field to locate and recover missing children.”

Other groups such as the Electronic Frontier Foundation take exception to the Senate going after the website’s hosting operations, saying the “invasive inquiry into Backpage.com’s editorial practices… creates an intense chilling effect… for any website operator seeking to define their own… moderation procedures for the third-party content they host.”

Legal questions may still be up for debate. The Senate Subcommittee is considering referring the case to the Department of Justice.

“Even under current law, I believe that this evidence of illegality should lead to a successful prosecution,” Sen. Portman said.

Last October, the California Attorney General charged Carl Ferrer, James Larkin, and Mike Lacey with pimping -- charges which were later dismissed due to the Communications Decency Act. They have now filed new charges against Backpage, citing new evidence. The site’s attorneys say they will fight these charges.

As for Tom, Nacole, and their daughter Natalie, they’re also waiting for their day in court. Natalie is part of a civil lawsuit against Backpage, one that focuses on the claim that Backpage was editing ads. Her lawyers hope that the revelations in the new Senate report could help them to win her case.

After the hearing, Tom told “Nightline” their fight against Backpage is far from over. “Not until they’re indicted and go to jail,” he said.