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| Cambridge Analytica, hired by Donald Trump's presidential campaign, said it had been "vilified" in recent months over "numerous unfounded accusations", which had decimated its business |
Cambridge
Analytica, the British marketing analytics firm, announced Wednesday that it
was closing and would file for insolvency in Britain and the United States
after failing to recover from the Facebook data scandal.
The
decision follows weeks of intense pressure on the company, hired by Donald
Trump's presidential campaign, after allegations emerged it may have hijacked
up to 87 million Facebook users' data.
It claimed
it has been "vilified" by the "numerous unfounded
accusations" which torpedoed its business and left the firm with "no
realistic alternative" but to go into administration.
"Despite
Cambridge Analytica's unwavering confidence that its employees have acted
ethically and lawfully... the siege of media coverage has driven away virtually
all of the company's customers and suppliers," it said in a statement.
"As a
result, it has been determined that it is no longer viable to continue
operating the business."
An
affiliate of British firm Strategic Communication Laboratories (SCL), CA has
offices in London, New York, Washington, as well as Brazil and Malaysia.
It drew
attention after former Trump chief strategist Steve Bannon reportedly once sat
on its board and was bankrolled to the tune of $15 million (12.5 million
euros)by US billionaire and Republican donor Robert Mercer.
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Estimate by
Facebook of the number of people affected by the Cambridge
Analytica affair in
the world
|
It first
became embroiled in scandal in March when Canadian whistleblower Christopher
Wylie, a 28-year-old former analyst for the firm, revealed it had created
psychological profiles of tens of millions of Facebook users via a personality
prediction app.
The
revelations instantly reverberated around the world, wiping billions from the
social media giant's market value and drawing scrutiny from politicians and
regulators on both sides of the Atlantic.
To make
matters worse for CA, CEO Alexander Nix was suspended within days after he was
filmed by undercover reporters bragging about ways to win political campaigns,
including through blackmail and honey traps.
As the
crisis intensified, Facebook chief Mark Zuckerberg was forced to apologise to
its billions of users amid a small but growing exodus from the site.
He
eventually appeared before Congress for a two-day grilling by lawmakers, and
has since vowed to overhaul the way the Facebook shares its users' data.
In Britain,
regulators ratcheted up a probe into CA, raiding its London offices, and later
extending the investigation to 30 organisations, including Facebook.
A second
whistleblower from the firm also emerged at a parliamentary hearing in April
claiming Britons' personal data may have been misused by a pro-Brexit campaign
ahead of the 2016 referendum in which Britain voted to leave the European
Union.
Earlier this
month, Facebook upped its count of the number of people impacted, admitting
that up to 87 million users may have had their data harvested.
CA has
vehemently denied exploiting that data for Trump's election campaign, claiming
it deleted data obtained in breach of the social network's terms of service.
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The
silhouettes of people are seen inside the offices of Cambridge Analytica in
London on March 23, 2018, just hours after a judge approved a search warrant of
the offices
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At a London
press conference last week a CA spokesman claimed the company was "no Bond
villain" and had broken no laws.
It hired
British barrister Julian Malins to conduct an independent investigation into
what it termed "a torrent of ill-informed and inaccurate speculation"
and posted his report on its website Wednesday.
"(The)
report... concluded that the allegations were not 'borne out by the
facts'," CA said.
"(It)
has been vilified for activities that are not only legal, but also widely
accepted as a standard component of online advertising in both the political
and commercial arenas," it added.
But the
company conceded the crisis had taken too heavy a toll and said its board had
appointed lawyers in Britain to oversee the insolvency process, and would be
following suit in America.
CA said
that although its financial condition was "precarious" it intended
"to fully meet its obligations to its employees"
Initial
reaction to the news in Britain was guarded.
Damian
Collins MP, chair of a parliamentary committee that held the hearings on the
issue and questioned Nix in February and Facebook executives last month, warned
CA "cannot be allowed to delete their data history by closing".
"The
investigations into their work are vital," he added.
VIDEO: Cambridge Analytica, the British marketing analytics firm, announces it is closing and will file for insolvency after failing to recover from the Facebook data scandal pic.twitter.com/VJUlRL0prA— AFP news agency (@AFP) May 3, 2018
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