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AGs blast Craigslist’s ‘brothel business’

Despite pledge, sex ads still rampant on site; company sees windfall a year after killing

Boston University medical student Philip Markoff was charged with murdering masseuse Julissa Brisman during an encounter at the Boston Marriott Copley Place hotel. He awaits trial in Suffolk Superior Court. Boston University medical student Philip Markoff was charged with murdering masseuse Julissa Brisman during an encounter at the Boston Marriott Copley Place hotel. He awaits trial in Suffolk Superior Court.
By Megan Woolhouse
Globe Staff / May 8, 2010

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A year after a masseuse was killed, allegedly by a man responding to her Craigslist posting, the company’s efforts to discourage sex advertisements by charging more and collecting credit card information are instead generating added profits, prompting a renewed investigation into its practices.

In Boston alone, Craigslist’s revenue from “adult’’ ad postings is anticipated to increase to $942,500 this year, from $160,000 in 2009, according to a consulting firm that tracks the classified ad website.

This week, Attorney General Richard Blumenthal of Connecticut, on behalf of 39 attorneys general nationwide, subpoenaed financial information from Craigslist, calling the site a booming “brothel business.’’

“We believe Craigslist has made a promise to the public, not just the AGs, that it would rid its site of these ads,’’ Blumenthal said. But “it continues to be an apparent online red light district with ads for activity that may be linked to child exploitation and human trafficking,’’ he said.

The adult postings, including thinly disguised come-ons for sex services, were criticized by authorities in several states after the April 2009 shooting death of Julissa Brisman, a 26-year-old New York City woman police said was killed by Boston University medical student Philip Markoff during an encounter at the Boston Marriott Copley Place hotel. Markoff pleaded not guilty to murder and other charges and is in jail, awaiting trial in Suffolk Superior Court.

Before Brisman’s killing, the same group of attorneys general and the National Center for Missing and Exploited Children had asked Craigslist to take steps to curb pornography, prostitution, and child trafficking on its site. This week’s move to subpoena company records is a continuation of that effort. Massachusetts Attorney General Martha Coakley is not participating. In a statement, she said federal law limits the ability of states to regulate website advertising.

After Brisman’s death, Craigslist chief executive Jim Buckmaster told the Globe that his site does not feature sex ads. The company later agreed to screen all “erotic services’’ listings and charge $5 to $10 for adult advertisements, saying that collecting customers’ credit card information would discourage illicit use and could be employed by authorities to track people using the site for illegal purposes.

The policy change has been good for business. Craigslist’s revenues are projected to rise 22 percent nationally this year, to $122 million, according to Advanced Interactive Media Group LLC, a Florida consulting firm. AIM estimated Craigslist will reap about $36.3 million from adult ads in 2010 — about three times last year’s total.

Buckmaster did not respond to interview requests from the Globe this week and the San Francisco company, which is private, does not disclose its financial information.

In a posting on his blog this week, however, Buckmaster said, “Craigslist has gone beyond fulfilling its legal obligations, far beyond classified industry norms, has more than lived up to any promises it made, and working together with its partners is, in fact, a leader in the fight against human trafficking and exploitation.’’

AIM said it made its revenue calculations by counting ads during a one-week period and extrapolating from that projected revenues for the year.

Peter M. Zollman, a founding principal at AIM who has been following Craigslist’s growth since 2003, said adult services ads account for about 30 percent of the company’s revenue. Postings are free on the site, with the exception of two categories in addition to adult services: jobs, and housing in New York City.

In Boston, AIM counted 1,900 erotic and adult advertisements during the second week of May 2009. It found 2,900 such ads during the first week of February this year.

Zollman said Craigslist changed the name of its “erotic services’’ section to “adult services’’ in 2009, but that little else about the site has changed since Brisman’s death. Those who want to use the site to sell sex services “may have to be marginally more circumspect in the wording of their ad, but only marginally,’’ he said. “It’s not like you can’t figure out the hooker ads very plainly.’’

Indeed, many of the advertisements posted this week left little to the imagination. “Sexy Stacy’’ of Braintree offered unnamed services by the half hour and hour, while Monica said she makes clients “go crazy,’’ and “Kitikiana’’ promised to “do whatevers that u want . . . so come and check me out.’’ Others posted photos of women in lingerie and provocative poses, along with phone numbers.

Last May, Craigslist sued South Carolina Attorney General Henry McMaster in federal court, saying he violated its constitutional rights by threatening to prosecute the company for abetting prostitution.

Craigslist has said it “deplores’’ ads for prostitution and uses “warning screens’’ stipulating that people must be at least 18 to enter the adult section of the site. In addition, the “terms of use’’ forbid content that is unlawful or obscene and requires users to report suspected exploitation of minors.

Ernie Allen, president of the National Center for Missing & Exploited Children, a national nonprofit advocacy group based in Alexandria, Va., said the company’s efforts have fallen short.

He said workers at the center have been able to identify some missing children — mostly young girls — by matching their photos with images posted on the site.

“I think they have done some positive things for which they deserve praise, but all you have to do is look at the site,’’ Allen said. “Increasingly, these kids are not being put on the streets of American cities; they’re being marketed for sale on the Internet. And the primary place they’re being marketed is Craigslist.’’

Megan Woolhouse can be reached at mwoolhouse@globe.com.

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