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Cambridge Analytica Shutting Down

Courtesy of ZeroHedge. View original post here.

After attempts to salvage the company's reputation – including suspending its controversial CEO Alexander Nix and vehemently denying wrongdoing – apparently failed to pan out, Cambridge Analytica will be shutting down, effective today, as insolvency proceedings begin, according to the Wall Street Journal.

SCOOP on https://t.co/1F4iskuBMt: Cambridge Analytica is shutting down, effective today. pic.twitter.com/hZqbZiyRsA

— Rebecca Ballhaus (@rebeccaballhaus) May 2, 2018

The company had promised to launch an independent investigation into whether it did anything wrong during its work on political campaigns. But it was also facing a probe from UK data regulators and was also losing clients and facing mounting legal fees.

Nigel Oakes, the founder of SCL Group, the British affiliate of Cambridge Analytica, confirmed that both companies were closing down to WSJ.

The moves followed the release of a video that depicted Mr. Nix touting campaign tactics such as entrapping political opponents with bribes and sex. The sales pitch was captured by undercover journalists at British broadcaster Channel 4. Mr. Nix’s suspension also follows reports that the company improperly used data from millions of Facebook Inc. profiles without authorization.

The business had $15 million in U.S. political work in the 2016 election cycle. Since then, Cambridge hadn’t notched a single U.S. federal political client. It lost several commercial clients in recent months.

The closure comes after recordings surfaced of Nix describing the company's shadowy methods, including entrapping politicians with bribes and sex workers.

Of course, the closure likely won't put an end to the investigation and continuing fallout – the bulk of which has been borne by Facebook. We imagine this won't be the last we hear about Cambridge Analytica.

The company has released its press release announcing the closure. Read it below:

* * *

London, UK – May 2, 2018—Earlier today, SCL Elections Ltd., as well as certain of its and Cambridge Analytica LLC’s U.K. affiliates (collectively, the “Company” or “Cambridge Analytica”) filed applications to commence insolvency proceedings in the U.K.  The Company is immediately ceasing all operations and the boards have applied to appoint insolvency practitioners Crowe Clark Whitehill LLP to act as the independent administrator for Cambridge Analytica.

Additionally, parallel bankruptcy proceedings will soon be commenced on behalf of Cambridge Analytica LLC and certain of the Company’s U.S. affiliates in the United States Bankruptcy Court for the Southern District of New York.  

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.   

In light of those accusations, noted Queen’s Counsel Julian Malins was retained to conduct an independent investigation into the allegations regarding the Company’s political activities. Mr. Malins report, which the Company posted on its website today, concluded that the allegations were not “borne out by the facts.” Regarding the conclusions set forth in his report, Mr. Malins stated:

“I had full access to all members of staff and documents in the preparation of my report. My findings entirely reflect the amazement of the staff, on watching the television programmes and reading the sensationalistic reporting, that any of these media outlets could have been talking about the company for which they worked. Nothing of what they heard or read resonated with what they actually did for a living.”

Despite Cambridge Analytica’s unwavering confidence that its employees have acted ethically and lawfully, which view is now fully supported by Mr. Malins’ report, 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.

While this decision was extremely painful for Cambridge Analytica’s leaders, they recognize that it is all the more difficult for the Company’s dedicated employees who learned today that they likely would be losing their jobs as a result of the damage caused to the business by the unfairly negative media coverage. Despite the Company’s precarious financial condition, Cambridge Analytica intends to fully meet its obligations to its employees, including with respect to notice periods, severance terms, and redundancy entitlements.


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