May 2, 2018 (BE2C2) — Cambridge Analytica, the embattled data firm that worked on President Trump’s 2016 presidential campaign, has told employees it is shutting down, along with its UK counterpart SCL Elections. The move, which impacts all offices of both companies worldwide, comes amid recent revelations that the company harvested the data of up to 87 million Facebook users without their consent, reports the Wired and the Wall Street Journal citing multiple sources close to the company.
The two companies have commenced insolvency proceedings, Reuters tweeted.
The decision to close the company’s doors internationally was announced to employees during a global town hall meeting, held in the firm’s New York City offices Wednesday.
The company’s recently appointed CEO Julian Wheatland told staffers the company had evaluated all options and no longer saw a way forward. One source said that New York employees were told to pack up and leave immediately, with few details about how they’ll be compensated going forward. The feeling in the room was “just shock,” says the source. “There was indication the company was in trouble and change would be coming, but we didn’t see this as the resolution.”
Representatives for Cambridge Analytica didn’t respond to WIRED’s request for comment. Gizmodo first reported that Cambridge Analytica’s US offices would shut down, but multiple sources close to the company say its international offices, and those of SCL, are shuttering as well.
Nigel Oakes, the founder of SCL Group, Cambridge Analytica’s British affiliate, confirmed to Wall Street Journal that both companies were closing down.
The company decided to close its doors because it was losing clients and facing mounting legal fees in the Facebook investigation, a person familiar with the matter said.
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.
In March, The New York Times, alongside The Guardian and The Observer, published simultaneous accounts from a former whistleblower named Christopher Wylie, who reported that Cambridge Analytica had hired a researcher to conduct a psychological profile of the American electorate. The researcher, Aleksandr Kogan, built a personality quiz app that collected data on anyone who took it, as well as on their friends. Kogan sold that data to Cambridge Analytica to develop so-called “psychographic profiles” of American voters. Hours before the news broke, Facebook cut Cambridge Analytica and SCL off from its platform, deeply wounding a company that had already lost market share in both its political and commercial business. Shortly after, Channel 4 news in the UK aired undercover videos in which the former CEO of Cambridge Analytica, Alexander Nix, was recorded bragging about using underhanded tactics like bribery and entrapment on behalf of his clients.
Nix was removed as CEO in March, but the company vowed to press on. Just yesterday, Cambridge Analytica’s official Twitter account tweeted out a link to a website refuting the waves of bad press the company has received with the caption, “Get the Facts Behind the Facebook Story.” Cambridge Analytica and SCL continue to be the subject of an investigation by the UK’s Information Commissioner’s Office into the role both companies played in the 2016 Brexit referendum.