LONDON • Embattled political consultancy firm Cambridge Analytica announced that it will cease most operations and file for bankruptcy amid growing legal and political scrutiny of its business practices and work for Mr Donald Trump's presidential campaign.
In a statement posted on its website on Wednesday, Cambridge Analytica said the controversy had driven away virtually all of the company's customers, forcing it to file for bankruptcy in both the United States and Britain.
"It is no longer viable to continue operating the business," Cambridge Analytica said in the statement.
SCL Elections, its parent, as well as Cambridge Analytica began insolvency proceedings in Britain, and said they would soon start bankruptcy proceedings in the United States. The elections division of Cambridge's British affiliate, SCL Group, will also shut down, the company said.
"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 company's statement said.
The firm shut down with effect from Wednesday and employees have been told to turn in their computers, The Wall Street Journal reported earlier.
The Cambridge Analytica sign had been removed from the reception area of its London offices on Wednesday. At SCL's Washington office, a man declined to answer questions.
Cambridge Analytica also said the results of an independent investigation it had commissioned, which it released on Wednesday, contradicted assertions made by former employees and contractors about its acquisition of Facebook data.
After the announcement, Britain's data regulator said it would continue civil and criminal investigations of the firm and will pursue "individuals and directors as appropriate" despite the shutdown.
"We will also monitor closely any successor companies using our powers to audit and inspect, to ensure the public is safeguarded," a spokesman for the Information Commissioner's Office said in a statement.
The decision was made less than two months after Cambridge Analytica and Facebook became embroiled in a data-harvesting scandal that compromised the personal information of up to 87 million people.
Revelations about the misuse of data, published in March by The New York Times and The Observer of London, plunged Facebook into crisis and prompted regulators and lawmakers to open investigations into Cambridge Analytica.
In a statement on Wednesday, Facebook said: "This doesn't change our commitment and determination to understand exactly what happened and make sure it doesn't happen again. We are continuing with our investigation in cooperation with the relevant authorities."
But Cambridge Analytica's announcement left several questions unanswered, including who would retain the company's intellectual property - the so-called psychographic voter profiles built in part with data from Facebook - and whether Cambridge Analytica's data-mining business would return under new auspices.
In recent months, executives at Cambridge Analytica and SCL Group have moved to create a new firm, Emerdata, based in Britain, according to British records.
NYTIMES, WASHINGTON POST, REUTERS