Battered survey firm to dissolve

British company files bankruptcy

FILE - In this April 24, 2018 file photo, Cambridge Analytica spokesperson Clarence Mitchell speaks during a news conference in London. Cambridge Analytica, which allegedly misused data from millions of Facebook users to help President Donald Trump's 2016 election campaign, has filed for Chapter 7 bankruptcy protection in the U.S. The U.K. firm said in a New York court filing late Thursday, May 17, that its assets totaled $100,001 to $500,000. Its liabilities are between $1 million and $10 million. Cambridge Analytica has previously said that none of the Facebook data it acquired from an academic researcher was used in the Trump campaign.  (AP Photo/Matt Dunham)
FILE - In this April 24, 2018 file photo, Cambridge Analytica spokesperson Clarence Mitchell speaks during a news conference in London. Cambridge Analytica, which allegedly misused data from millions of Facebook users to help President Donald Trump's 2016 election campaign, has filed for Chapter 7 bankruptcy protection in the U.S. The U.K. firm said in a New York court filing late Thursday, May 17, that its assets totaled $100,001 to $500,000. Its liabilities are between $1 million and $10 million. Cambridge Analytica has previously said that none of the Facebook data it acquired from an academic researcher was used in the Trump campaign. (AP Photo/Matt Dunham)

NEW YORK -- Jennifer and Rebekah Mercer, daughters of Republican mega-donor Robert Mercer, are liquidating Cambridge Analytica, the troubled data collection agency that worked for President Donald Trump's 2016 election campaign and caused a global Facebook privacy scandal in recent months.

The British firm filed for Chapter 7 bankruptcy protection late Thursday in New York.

The Mercer sisters, who are majority shareholders of Cambridge Analytica, bought their father's stake in the pro-Trump website Breitbart News in late 2017.

Cambridge Analytica has come under scrutiny for possible links to the federal probe into Russia's meddling in the 2016 president election and fallen into the cross hairs of special counsel Robert Mueller.

The American bankruptcy case could shed light on some of the company's relationships and finances, as U.S. legal proceedings are more transparent than those in the U.K., and creditors can use bankruptcy law to subpoena information and investigate asset transfers.

The data collection agency filed papers to begin insolvency proceedings in the U.K. earlier this month. At the time, it blamed "unfairly negative media coverage" and said it had been "vilified" for actions it said were both legal and widely accepted as part of online advertising.

Cambridge Analytica said in a May 2 statement on its website that it lost "virtually all" customers and suppliers as a result of reports that it improperly obtained information from tens of millions of Facebook Inc. users.

Cambridge Analytica has insisted that none of the Facebook data it acquired from an academic researcher was used in the Trump campaign. The company was able to amass the database quickly with the help of an app that purported to be a personality test. The app collected data on tens of millions of people and their Facebook friends, even those who did not download the app themselves.

Facebook has since tightened its privacy restrictions, and Chief Executive Officer Mark Zuckerberg testified before Congress in two days of hearings. Facebook also has suspended other companies for using similar tactics. One is Cubeyou, which makes personality quizzes. That company has said it did nothing wrong and is seeking reinstatement.

Cambridge Analytica suspended CEO Alexander Nix in March pending an investigation after Nix boasted of various services to an undercover reporter for Britain's Channel 4 News. Channel 4 News broadcast clips that showed Nix saying his data-mining firm played a major role in securing Trump's victory in the 2016 presidential elections.

Acting CEO Alexander Tayler also stepped down in April and returned to his previous post as chief data officer.

On Thursday British lawmakers investigating the use of Facebook users' data in political campaigns said that Nix accepted a summons to appear before Parliament's media committee. He will appear on June 6.

Separately, it was announced that Zuckerberg will meet with leaders of the European Parliament in a private meeting Tuesday about the data protection scandal that has engulfed his company.

Robert Mercer, who made his fortune as co-CEO of Renaissance Technologies, has been a financial backer of Cambridge Analytica, along with Steve Bannon and Breitbart News.

Cambridge Analytica said in its May 2 statement that it has "been the subject of numerous unfounded accusations" and that it has been vilified for activities that are not only legal, "but also widely accepted as a standard component of online advertising."

In March, footage emerged of the company's executives bragging about how prostitutes and former spies could be used to ensnare politicians and influence elections. One segment showed Nix saying that Ukrainian girls "are very beautiful, I find that works very well." Nix in a BBC interview later said the allegations were "unfounded and extremely unfair."

A whistleblower from Cambridge Analytica set off a firestorm in March after he revealed how information was extracted from Facebook and used to influence voters. He testified before a U.K. parliamentary committee, describing the firm as one that dealt with illegal data and hacked material to win elections. He said Trump's victory was one of the reasons he blew the whistle. House Democrats who met with him in April called his information "disturbing."

Information for this article was contributed by staff members of The Associated Press; and by Tiffany Kary of Bloomberg News.

Business on 05/19/2018

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