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Cambridge Analytica shuts down, to file for bankruptcy

In a statement posted on its website, Cambridge Analytica said the “siege of media coverage” had driven away all its customers and suppliers

Cambridge Analytica shuts down, to file for bankruptcy

The building that houses the Cambridge Analytica office in London. (Photo: AFP)

Cambridge Analytica, the British political consulting firm in the dock for a massive data-harvesting scandal, has announced to shut down and file for bankruptcy. SCL Elections Ltd, the elections division of Cambridge’s British affiliate SCL Group, will shut down too.

The alleged misuse of data by CA, which worked with Donald Trump’s team ahead of the US Presidential election and also the winning Brexit campaign, compromised personal information of up to 87 million Facebook users. With regulators and lawmakers opening investigations against Cambridge Analytica, Facebook too faced heat and its CEO Mark Zuckerberg had to testify before the US Congress last month over data privacy concerns.

In a statement posted on its website on Wednesday, Cambridge Analytica said the “siege of media coverage” had driven away all of its customers and suppliers.

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Stating that it had filed applications to commence insolvency proceedings in the UK, the company said it was immediately ceasing all operations. Bankruptcy proceedings will soon be commenced simultaneously on behalf of Cambridge Analytica LLC and certain of its US affiliates in the United States Bankruptcy Court for the Southern District of New York.

In its statement, CA reiterated that the allegations and accusations levelled against it over the past several months were unfounded. Despite its efforts to correct the record, the company said, it had 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”.

Cambridge Analytica also said it had commissioned an independent investigation into the allegations regarding the company’s political activities, which concluded that the allegations were not “borne out by the facts”.

The investigation report, published on the CA website on May 2, plays down the role of Christopher Wylie, the whistleblower, saying, his involvement with SCL was “very modest”. The report also said “it does not appear that he has any formal science or mathematical qualifications”, adding it was learnt from the SCL staff that “Wylie was taught coding on an external course in London during the time he was working with SCL”.

Claiming that the report contradicted all assertions made about the acquisition of Facebook data by the company, the statement said the investigation supported CA’s view that its employees acted ethically and lawfully. However, it said, the continued negative media coverage drove away all its customers and it was no longer viable to remain in business.

Stating that its employees would be losing their jobs due to the “damage caused to the business by the unfairly negative media coverage”, Cambridge Analytica said in the statement it intended to fully meet its obligations towards them “including with respect to notice periods, severance terms, and redundancy entitlements”, despite the company’s “precarious financial condition”.

The company has applied to appoint insolvency practitioners Crowe Clark Whitehill LLP to act as the independent administrator for Cambridge Analytica.

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