by Beth Connolly on April 19, 2012
Nick Kristof isn’t going to let this one rest.
The world economist and New York Times columnist continues his investigation into Backpage.com–and his criticism of Wall Street–in his latest column.
Several weeks ago, Kristof exposed Goldman Sachs’ involvement in Backpage.com, a site that “plays a major role in the trafficking of minors or women who are coerced,” according to Kristof.
Apparently Goldman was unaware of Backpage’s ties to underage prostitution, and immediately unloaded their shares of Village Voice Media, Backpage’s owners. Kristof criticized the move at the time, saying that Goldman ought to have used their position of influence to change Backpage’s policy.
This week, he interviews a fifteen-year-old girl who was marketed for sex on Backpage starting when she was twelve years old.
He also has some choice words for those at Goldman:
Backpage accounts for about 70 percent of America’s prostitution ads (many placed by consenting adults who are not trafficked), according to AIM Group, a trade organization. Backpage cooperates with police and tries to screen out ads for underage girls, but that didn’t help Brianna [the subject of this column].
Backpage is owned by Village Voice Media, and significant minority stakes have been held in recent years by Goldman Sachs and smaller financial firms such as Trimaran Capital Partners and Alta Communications. My research shows that representatives of Goldman, Trimaran and Alta, along with a founder of Brynwood Partners, all sat on the board of Village Voice Media, and there’s no indication that they ever protested its business aims.
When I wrote recently about this, these firms erupted in excuses and self-pity, and in some cases raced to liquidate their stakes. I was struck by the self-absorption and narcissism of Wall Street bankers viewing themselves as victims, so maybe it’s useful to hear from girls who were victimized through the company they invested in.
Should Goldman have kept their shares of Village Voice Media and attempted to change its policy? Or did they do the right thing by backing out as soon as they realized the connection? Do banks have a responsibility to monitor the ethical policies of the organizations they invest in?