Samsung cops $355K fine for fake reviews

Taiwan’s Fair Trade Commission (FTC) has fined Samsung $355,000 (NT$10 million) after finding the company hired people to post fake online reviews of Samsung phones and phones from a Samsung rival.

An FTC investigation found that Samsung organised a campaign where people were paid to post online articles critical of phones from a Samsung rival and articles praising Samsung’s own phones.

According to the FTC, the campaign violated Taiwan’s Fair Trade Law.

The Samsung rival whose phones were criticised in the campaign is widely speculated to be HTC, though the ruling does not mention HTC by name.

Two other firms involved in the campaign were also fined, albeit with much smaller amounts - $107,000 (NT$3 million) and $1,800 (NT$50,000).

Samsung’s fine was less than half the maximum $885,000 (NT$25 million) fine that could have been imposed.

The companies are entitled to appeal the decision.

“We are disappointed that the Taiwan FTC has decided that we have violated the Fair Trade Act based on online marketing activities,” a Samsung spokesperson said.

“Samsung Electronics Taiwan is carefully reviewing the decision and will take all necessary steps to protect our reputation as a company which values its customers.”

The FTC reportedly began its investigation in April after website TaiwanSamsungLeaks.org began publishing documents related to the campaign.

Whether or not the fine will have much of a fiscal impact on Samsung is up for debate. It’s hard to imagine that the $355,000 fine will put much of a dent in the company’s 2013 Q3 net profit of $8.1 billion (8.24 trillion KRW), which was announced last week.