Room Service Entertainment, headquartered in Queens, N.Y. and advertised in the "Erotic Services" section of the popular online classified site, was an illicit prostitution operation that used codes to arrange transactions, Cuomo's office said.
The arrest highlights the continued presence of prostitution ads on Craigslist, according to Cuomo.
"Until Craigslist gets serious about putting real protections in place, it will continue to be an environment where criminal operations thrive with impunity," Cuomo said in a press release. "Even after so-called reform of the Website last fall, this prostitution ring easily gamed the system ... Today's arrests underscore the inherent risks posed by Craigslist and, most importantly, the need for protections that are full-fledged, not half-baked."
In addition to employing prostitutes, the company also hired "bookers" who would post ads to Craigslist and take phone calls from prospective customers to set up a meeting, officials said. On the phone, bookers and clients did not use the term sex and instead referred to "GFE," or girlfriend experiences, as well as "skiing" and "rock climbing," which referred to drugs and partying, according to authorities.
Among the indicted are the owners of the alleged ring - Scott Rosenberg, 45, and Josef Davenport, 31. Five alleged bookers were also named - Patricia Krupa, 32, Joanna Mercado, 24, Sylvia Soto, 29, Lina Vazquez, 24 and Barbara Morris, 48.
The charges include enterprise corruption, conspiracy and money laundering.
Meanwhile, Craigslist's chief executive is suing South Carolina's attorney general, claiming the prosecutor's threat to file prostitution charges against the San Francisco company is unreasonable.
CEO Jim Buckmaster said on his blog he wants a restraining order to keep Attorney General Henry McMaster from pursuing criminal charges.
McMaster said last week he would prosecute Craigslist executives for aiding and abetting prostitution if an ad on the site leads to a prostitution case in South Carolina. McMaster has said his office is investigating, but no charges have been brought.
In a statement, McMaster says the lawsuit shows Craigslist is taking his investigation seriously and called it a victory. The lawsuit was filed late Tuesday night in a federal court in South Carolina