Craigslist Faces Scrutiny

The popular classified ads site, Craigslist, is under some serious pressure.

The Houston Association of Realtors has learned of two real estate scams on the site, and Wednesday, Craigslist pulled the plug on its "erotic services" category. It'll be replaced with what Craigslist calls a better monitored "adult" category.

This is the latest chapter in a battle by state attorneys general to eliminate illegal content on the Internet.

In a bad economy, Craigslist is more popular than ever. It's good for job hunting, bartering and turning trash into treasure.

But Houston manicurist Mary Thai is also familiar with the site's bad side.

"I was livid, shocked, hurt. Everything just rushed through my mind," said Thai.

She and her husband lost $1,400 in a rental scam. The Jersey Village house they tried to lease off Craigslist was really for sale, and the poster, who claimed to be the listing agent, was a fraud. When Thai located the legitimate Realtor, she was told she had been scammed.

Craigslist has gained notoriety for such scams, as well as prostitution and even murder. Last month a Boston medical student was accused of killing a masseuse he met through the site, prompting Craigslist to do away with its "erotic services" category.

"It's my opinion these attorneys general should be going after the people who put these ads on Craigslist rather than Craigslist," said Joe Larsen, a local media law attorney.

Craigslist can't be sued over what a third party posts on its site.

"I do think some of these sites should be proactive. On the other hand, I don't think it benefits society or the marketplace of ideas to make these Internet Service Providers into Internet cops," added Larsen.

Mary Thai doesn't blame Craigslist for duping her.

But she says, "I wish they had a way of screening and checking emails to make sure they (posters) are who they say they are."

Craigslist warns about ads requiring customers to send or wire money. Thai has filed a complaint with the Houston Police Department.