Facebook has suffered from a huge drop in its share price after allegations appeared in the New York Times and Observer on how data analytics firm, Cambridge Analytica, used Facebook-sourced data to influence the both the 2016 US Elections and the Brexit Referendum – and the scandal is only growing.
Christopher Wylie – the whistleblower who has made the damning allegations – claims that in conjunction with a UK-based academic, the analytics group harvested the data of over 50 million Facebook profiles. The data gained from this process was then used extensively in a number of political campaigns carried out on the social media platform.
As the story unfolds, the tale of Facebook’s role in election meddling grows ever stranger – with secretive American billionaires, White House chief strategists, alt-right groups and big data firms all being drawn into the mix.
What is Cambridge Analytica?
Cambridge Analytica is a firm that provides services to both businesses and political organisations, by observing audience behaviour on social media. It was first set up in 2013 as an offshoot of another analytics company, known as SCL Group, which offers similar services to businesses and political campaigns across the globe.
The company harvests and analyses huge amounts of personal data, from social media platforms such as Facebook, as well as its own personal polling. Not only do they process personal data, they employ behavioural science techniques to identify users that its clients can target with highly focused marketing material – This can range from campaign ads to recommended posts and video content.
The firm’s main goal was initially to address what its founder Alexander Nix claims was a “vacuum in the US Republican political market” in the wake of Mitt Romney’s 2012 US Election defeat.
In a 2016 interview with Contagious, Nix claimed that the “Democrats had ostensibly been leading the tech revolution, and data analytics and digital engagement were areas where Republicans had failed to catch up.”
Exploiting social media to catch up with a visibly better-equipped political adversary, which utilises social media more effectively, would certainly be a logical choice for the Republican camp.
The issue lies with the dangerous and invasive methods used to gain an upper-hand in the ‘dynamic’ to-and-fro of American politics. Speaking to the Observer, Christopher Wylie claimed the company’s aim was to ‘target their [Facebook users] inner demons’ and that they ‘built models to exploit what we knew about them’
From a beginning with perhaps justified – albeit ethically debatable – intentions, in 2018 Cambridge Analytica finds itself in the midst of an almighty political stramash on both sides of the Atlantic. It stands accused of a privacy invasion, links to alt-right groups and misconduct during a referendum crucial to the future of the United Kingdom – and an election already embroiled in scandal.
Despite the claims made by Wylie, the firm has denied any wrongdoing through its social media channels, saying “we refute these mischaracterizations and false allegations, and we are responding”
We refute these mischaracterizations and false allegations, and we are responding — watch our Twitter feed for more.
— Cambridge Analytica (@CamAnalytica) March 17, 2018
Global Science Research
UK-based academic, Alexander Kogan is a prominent figure in this entire affair. It was revealed that the harvesting of the 50 million+ profiles was done through the UK-based firm Global Science Research (site currently offline), and that Kogan had a deal with Cambridge Analytica to share the illegally-sourced information.
Wylie claims that most of this information was taken without authorisation, and that Cambridge Analytics subsequently used it to build software that would ultimately monitor users’ data patterns and influence their decisions at voting stations.
Where Does Trump Come in?
According to the Federal Elections Commission, Donald Trump’s campaign hired Cambridge Analytica to assist in the 2016 election campaign – paying over $6.2 million for their services. It is during this period that the firm is accused of using Facebook users’ data to market ad campaigns to his voter-base.
The company denies using any Facebook-sourced data during this period, yet the revelations over this past weekend all point toward this being the case.
Wylie alleges that Bannon colluded with Robert Mercer, the US billionaire, Republican donor and investor in Cambridge Analytica to create a plan to use social media data to carry out what verges on military-style information warfare tactics during the election campaign.
Where Does Facebook Stand?
This recent revelation seems to further validate the long-standing accusations that Facebook was used as a primary tool by the Trump team to target voters during the 2016 US Election, and that the social media giant knowingly ignored the process.
Since then, CEO Mark Zuckerberg has publicly declared the the firm would take steps to ensure transparency in their operations and establish clear-cut rules and regulations surrounding the use of the platform as a tool for political campaigns. Regardless, this is another damning allegation against a firm already backed into a corner by a growing number of governments worldwide
Facebook’s response to these allegations has been nothing short of shameful, with the company suspending and then publicly attacking the whistleblower. Christopher Wylie tweeted yesterday that his account had been suspended by Facebook in revenge for blowing the whistle on something they had “known privately for two years”
— Christopher Wylie (@chrisinsilico) March 18, 2018
According to the Observer, before the story broke, Facebook’s legal team contacted the publication claiming that the allegations were “false and defamatory”.
The social media giant fervently denies that the harvesting of millions of user’s profiles and personal data by Cambridge Analytica and GSR was a breach of data.
Pressure From MP’s
Closer to home, MP’s have expressed their outrage over the apparently deceptive behaviour by both Facebook and CA. During last month’s parliamentary inquiry into fake news, representatives from Facebook, as well as Nix himself, told MP’s that the company did not posses or use any Facebook-sourced information – Or any from Global Science Research.
A contradictory statement on Friday night from Facebook however claims that the firm were aware that profiles were given to Nix’s company.
Damian Collins MP released a statement on Sunday 18th of March, calling for Facebook CEO Mark Zuckerberg to provide evidence to the parliamentary committee, declaring “I will be writing to Mark Zuckerberg asking that either he, or another senior executive from the company, appear to give evidence in front of the Committee as part our inquiry.”
He added: “data has been taken from Facebook users without their consent, and was then processed by a third party and used to support their campaigns.”
“We are investigating the circumstances in which Facebook data may have been illegally acquired and used.
“It’s part of our ongoing investigation into the use of data analytics for political purposes which was launched to consider how political parties and campaigns, data analytics companies and social media platforms in the UK are using and analysing people’s personal information to micro target voters.”
Channel 4 Expose – Honey Traps and ‘Operatives’
Channel 4 News ran an in-depth expose of Cambridge Analytica on the evening of Monday 19th March. Using hidden camera footage and an undercover reporter claiming to be interested in influencing elections in Sri Lanka, the news team recorded executives from the company making a number of claims about the way the company operates.
In one clip, Cambridge Analytica’s CEO, Alexander Nix, tells the reporter that the firm secretly campaigns in elections across the world through a web of shadowy front companies, or by using sub-contractors.
Responding to a question about gathering intelligence on political opponents, Mr Nix said they could: “send some girls around to the candidate’s house”, adding that Ukrainian girls “are very beautiful, I find that works very well.”
In an ironic twist, given that this was recorded and released through a concealed camera, Mr Nix told the reporter: “We’ll offer a large amount of money to the candidate, to finance his campaign in exchange for land for instance, we’ll have the whole thing recorded, we’ll blank out the face of our guy and we post it on the Internet.”
Channel 4 has further updates on the story promised for later in the day.
ICO: “We should all be shocked and deeply concerned”
Elizabeth Denholm, the UK’s Information Commissioner, spoke to Channel 4 News, telling the programme: “The issue of Facebook and Cambridge Analytica is only one strand of our investigation. Our investigation involves more than 30 organisations, social media companies, data analytics companies, politcal campaigns and political parties. So it is a wide and comprehensive investigation, so that we can explain to the public what happens to their personal data during political campaigning.”
“On March 7th, I issued a demand for access to Cambridge Analytica. They were given until 6pm tonight (March 19th 2018) to respond to it. I’m not accepting their response, so therefore I’ll be applying to the court for a warrant. I’ve instructed my office tomorrow. We need to get in there, we need to look at the databases, look at the servers and understand how data was processed or deleted by Cambridge Analytica. There are a lot of conflicting stories about the data.”
When asked if Facebook had reported the illicit use of the data two years ago, when it was made aware of the issue, Ms Denholm told Channel 4 that the company had not, noting there was no legal requirement for them to do so, but also that this will change in May 2018 with the introduction of GDPR.
In a statement on the Information Commissioners Office website, Ms Denholm states: “A full understanding of the facts, data flows and data uses is imperative for my ongoing investigation. This includes any new information, statements or evidence that have come to light in recent days.
“Our investigation into the use of personal data for political campaigns, includes the acquisition and use of Facebook data by SCL, Doctor Kogan and Cambridge Analytica.
“This is a complex and far reaching investigation for my office and any criminal or civil enforcement actions arising from it will be pursued vigorously.”
The Guardian reports that a warrant is now being sought and investigators appointed by Facebook have been asked to step back from their own investigation.
So Be It
In a press release on the company website, focusing on the Channel 4 report, Cambridge Analytica states: “Assessing the legality and reputational risks associated with new projects is critical for us, and we routinely undertake conversations with prospective clients to try to tease out any unethical or illegal intentions. The two Cambridge Analytica executives at the meeting humoured these questions and actively encouraged the prospective client to disclose his intentions. They left with grave concerns and did not meet with him again.
“We use meetings like this to make an informed decision about those whom we should or shouldn’t engage with, in line with the guidance laid out by Section 9 of the UK Bribery Act 2010. The company’s practice is for staff to gently de-escalate the conversation before removing themselves from the situation.”
Alexander Nix is quoted in the same release, claiming the recorded remarks were merely humoring the reporter:
“In playing along with this line of conversation, and partly to spare our ‘client’ from embarrassment, we entertained a series of ludicrous hypothetical scenarios. I am aware how this looks, but it is simply not the case. I must emphatically state that Cambridge Analytica does not condone or engage in entrapment, bribes or so-called ‘honeytraps’, and nor does it use untrue material for any purpose.
“I deeply regret my role in the meeting and I have already apologised to staff. I should have recognised where the prospective client was taking our conversations and ended the relationship sooner.”
The company’s Twitter channel however, had a slightly less contrite air, tweeting:
— Cambridge Analytica (@CamAnalytica) March 19, 2018
Facebook Fallout – $37 Billion and Counting
While the main focus of the ongoing investigation is Cambridge Analytica, the fallout for Facebook is already enormous. The company has seen shares fall by nearly 7%, wiping around $37 billion from the company’s value.
The scandal may already have claimed its first executive scalp. Facebook’s Chief Information Security Officer Alex Stamos is reportedly leaving after disagreements over how the social media network should handle the spread of disinformation. The news was first reported by The New York Times, and later independently reported by Reuters and the Wall Street Journal.
In a tweet, Stamos said he was still employed, but that his role had changed to “exploring emerging security risks and working on election security.”
In a separate interview at the ShopTalk retail conference on Monday 19th March, Carolyn Everson, Facebook’s vice president of marketing, says that the company is “outraged and beyond disturbed” by the Cambridge Analytica affair.
“If the allegations are true, this is an incredible violation of everything that we stand for,” Everson said.
Facebook CEO Mark Zuckerberg is now facing an increasing number of calls to appear in person at investigations into the company’s conduct and use of personal data.
The BBC reports Adam Schiff, the highest-ranking Democrat in the United States’ House Intelligence Committee, which is already investigating social media manipulation in the run up to the 2016 presidential election, saying: “I think it would be beneficial to have him come testify before the appropriate oversight committees,”.
“And not just Mark but the other CEOs of the other major companies that operate in this space.”