Political consulting and data analytics firm Cambridge Analytica filed for insolvency in the United Kingdom together with its parent SCL Elections and will soon be commencing identical bankruptcy proceedings in the United States, the company said Wednesday. The move comes some six weeks after the initial revelation of a major data privacy scandal that saw the entity in question hire an independent researcher to harvest data from Facebook users through an online personality quiz requiring a Facebook login, consequently compromising up to 87 million people in the summer of 2014.
The controversy saw Facebook co-founder and CEO Mark Zuckerberg grilled by several U.S. congressional committees for nearly ten hours in total last month and placed massive pressure on the world's largest social media network over the manner in which it allows developers access to user data and acts against potential misuse in a pre-emptive manner, i.e. doesn't, or didn't, according to Facebook's apologetic statements on the matter that subsequently saw it vow to do better going forward and make its data management policies stricter, particularly toward third parties. Cambridge Analytica repeatedly denied any wrongdoing, arguing that it hasn't leveraged the obtained data to assist the Trump campaign during the 2016 presidential election in the U.S. and attempt influencing voter behavior through psychographics even though it worked for it in other segments such as more traditional digital advertising.
The same sentiment was repeated in the company's Wednesday release announcing insolvency proceedings, with the firm arguing it "has been vilified for activities that are not only legal, but also widely accepted as a standard component of online advertising." Simultaneously with the disclosure in question, Cambridge Analytica published the report into the matter conducted by Queen’s Counsel Julian Malins who found no evidence of any legal transgressions being conducted by the company, either in terms of the Facebook data in question or claims of honey trapping conducted for political gain. "Indeed, the only person who is currently and consistently embroiled in these kinds of [honey trapping] allegations, is the current President of the USA, in whose interests CA worked, not against him," the report reads. While the investigator said Cambridge Analytica's political division chief Mark Turnbull and former CEO Alexander Nix partially fueled the backlash and allegations against the company due to some outlandish claims about the firm's technological capabilities to influence people's behavior while speaking with undercover reporters, he concluded that nothing in his findings suggest such claims "have been borne out by the facts."
While the development marks the official end for Cambridge Analytica that already ceased its global operations while it awaits insolvency proceedings, Facebook's trouble with legislators and privacy advocates around the world are only beginning. Later this month, the company will come under the jurisdiction of the EU's new General Data Protection Regulation which warrants a much stricter approach toward mining, storing, managing, and utilizing digital user data.