Cambridge Analytica, the data firm at the centre of the Facebook privacy scandal, is shutting down. The company has filed applications to commence insolvency in the UK and US overnight, saying they had been “vilified” for practice which was a “standard component” of digital advertising.
The company came under intense scrutiny when it was revealed they had used the data of millions of Facebook users without consent, including 311,000 Australian users, to construct psychographic voter profiles which were used for targeted political advertising, during the 2016 US presidential election. They obtained the user data from a University of Cambridge professor, Aleksandr Kogan, who says he had collected it for academic purposes.
Cambridge Analytica has defended its actions and blamed its loss of customers on “unfairly negative media coverage”, in a statement announcing its insolvency.
“Over the past several months, Cambridge Analytica has been the subject of numerous unfounded accusations and, despite the Company’s efforts to correct the record, 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.”
“The siege of media coverage has driven away virtually all of the Company’s customers and suppliers. As a result, it has been determined that it is no longer viable to continue operating the business, which left Cambridge Analytica with no realistic alternative to placing the Company into administration.”
In addition to the Facebook scandal, Cambridge Analytica executives were revealed to be offering several entrapment services to its political clients, including the uses of ex-spies and manufacturing a sex scandal.
The “power players” behind Cambridge Analytica have set up a new data firm, Emerdata, according to Business Insider.
Cambridge Analytica said it is committed to meeting its obligations to remaining employees, including severance terms and redundancy entitlements. However, employees in the firms New York offices appear to have made a hasty exit, according to The Guardian.