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I think you should carefully read your quote - it includes the word "Backpage" four times, as in the illegal source of funds that created the laundry opportunity. Breach of contract with payment processors is certainly NOT wire fraud by itself, that's an absurd statement.

You're weirdly stuck on this "breach of contract superseding federal crimes" thing but uh, I don't know what to tell you. This scheme is clearly wire fraud. Defrauding a payment processor out of money, over wires, is wire fraud. It's also bank fraud when you lie to your bank about what your merchant account is for, which is another prerequisite for these schemes usually.

He is correct. This is how I build my cases.

I would just be aware that any interaction with the financial system can quickly become criminal. Whether it does depends on a whole range of factors, but the option is always there. (Incidentally, the same goes for insurance companies. Can go criminal at any time.)

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