US and European lawmakers have demanded an explanation of how Cambridge Analytica gained access to the data in 2014 and why Facebook failed to inform its users, raising questions about consumer privacy.
Since the news, hashtag '#DeleteFacebook' has trended worldwide with social media users calling for a boycott of the platform.
But many also felt that deleting their Facebook account was not the solution to the issue, highlighting a broader public surveillance issue.
According to the New York Times, Cambridge Analytica spent US$800,000 in 2014 to get Russian-American academic Aleksandr Kogan to build an app to harvest the data of Facebook users. He created a personality quiz called "thisisyourdigitallife" and Cambridge Analytica paid for people to take it. 270,000-odd people downloaded the app.
According to Facebook, users consent for their information to be used simply by downloading the app, but media reports said it also extracted the personal data of each of those users’ friends, unbeknown to them.
Aleksandr Kogan then passed all the data his app collected on some 50 million users onto Cambridge Analytica and other companies. Of those accounts, sufficient data had been gleaned to create psychographic profiles on 30 million of them, which it used to understand and influence voter behaviour for its clients.
Facebook said it removed the app in 2015 when it learned of the violations and told everyone who received the misappropriated data to destroy it.
Sources told several media outlets that the data was not deleted.
Cambridge Analytic's suspended CEO also allegedly claimed in a video recording that his company played a decisive role in the 2016 election campaign of President Donald Trump, according to Channel 4 News.
The US Federal Trade Commission (FTC) is questioning Facebook about the data acquired by Cambridge Analytica.
However, there is no indication of a formal investigation.
“We remain strongly committed to protecting people’s information. We appreciate the opportunity to answer questions the FTC may have,” Facebook Deputy Chief Privacy Officer Rob Sherman said.
Facebook says Cambridge Analytica violated terms of the social network by misusing data from an academic researcher.
"The entire company is outraged we were deceived. We are committed to vigorously enforcing our policies to protect people's information and will take whatever steps are required to see that this happens," the statement from the company read.
Facebook boss Mark Zuckerberg has been summoned by a British parliamentary committee to answer questions as to how the data was accessed.
Mr Zuckerberg is also under pressure to testify before US Congress.
The Information Commissioner's Office is also chasing a warrant to access Cambridge Analytica's servers.
- With Reuters