Title Cambridge Analytica's CEO allegedly took $8 million from the firm before its closure
Publication Date 2018-06-06
Former Cambridge Analytica CEO Alexander Nix allegedly withdrew more than $8 million from the British data firm before its collapse last month.
The Financial Times, citing sources, reported that Nix took the cash shortly after media reports of Cambridge Analytica's involvement in the Facebook data scandal.
He is now in dispute with investors over returning the money, which was reportedly intended to help get successor data firm, Emerdata, off the ground.
Nix told British lawmakers on Wednesday that the allegation in the FT article was "false."
The former CEO of Cambridge Analytica allegedly withdrew more than $8 million (£6 million) from the British data firm before its collapse last month.
The Financial Times reported on Wednesday that Alexander Nix is in dispute with investors after he allegedly walked away with the cash, while Cambridge Analytica staff and investors salvaged little or nothing from the company's closure.
Specifically, the FT said, the dispute is with the investors in Emerdata, a potential successor company set up by the power players at Cambridge Analytica.
Emerdata reportedly raised $19 million from international investors in January, before Cambridge Analytica's role in harvesting the data of 87 million Facebook users became public knowledge.
This money ran out quickly, however, because of outstanding bills to advertisers and suppliers, and Nix's alleged withdrawal. Bankruptcy filings in New York show that Cambridge Analytica received an $8.8 million loan from Emerdata before it entered administration, according to the FT.
Business Insider has contacted Nix for comment. He has not commented on the allegations so far. People familiar with the matter told the FT that Nix's withdrawal came shortly after the data breach story exploded and was made in "exchange for unbooked services." He intends to repay part of the money, the FT said.
Nix was asked about the alleged transaction on Wednesday when he appeared before British lawmakers to answer questions about the Facebook data scandal. "What I can say is that the allegation in that article is false. The facts in that article are not correct," he said.
It is the second time he will give evidence to the powerful Digital, Culture, Media, and Sport Committee after lawmakers fear he may have misled them during his first hearing.
What is Emerdata?
Emerdata was incorporated in the UK last year by several Cambridge Analytica executives before the Facebook scandal thrust their activities into the spotlight.
Rebekah and Jennifer Mercer, daughters of hedge fund tycoon and prominent Trump supporter Robert Mercer, joined Emerdata as directors as the Cambridge Analytica scandal hit. Another notable director was Johnson Chun Shun Ko, an executive with close links to another Trump supporter, Erik Prince.
The timing of the appointments contributed to media speculation that Emerdata could succeed Cambridge Analytica, since it involved many of the same people and backers.
But Nigel Oakes, founder of Cambridge Analytica's parent company SCL, told Bloomberg in May that Emerdata had gone into administration. "The whole lot is gone," he said.
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