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Advertiser buys ads (via a network intermediary) on "Good sites, but not Pirate Bay"

Evil person creates a (simple, weak) good site, and sells ads on it.

Advertiser pays Evil person to show ads on simple, weak, good site.

Evil person then displays those ads (via iframe) on Pirate Bay.

Advertiser thinks the end-user visited Good site.

How does Evil person interact with Pirate Bay owners? Does the Pirate Bay knowingly host fraudulent ads in return for a share of the profit?

The "Evil person" and the "Pirate Bay owners" are the same people.

The ads are not fraudulent per se -- real humans are seeing the ads and interacting with them.