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Samsung hit with $340,000 fine for trashing HTC in fake forum posts

Here’s one way to ensure your products look great in the eyes of consumers – hire people to write gushing comments about them in online forums. Oh, and while you’re at it, pay some others to lay into rival products. Easy!

Except that Samsung got caught.

An investigation launched earlier this year by Taiwan’s Fair Trade Commission (FTC) into claims that Samsung was paying students to post negative comments in local forums about devices made by Taiwanese company HTC, as well as positive comments about its own products, has ended with the FTC hitting Samsung with a sizable NT$10 million ($340,000) fine. The Korean company is yet to announce whether it’ll appeal the decision.

The matter first hit the headlines in the spring when a Taiwan-based website published documents containing tech-site forum posts that trashed HTC products. Nothing wrong with that, you might think, except that Samsung was apparently paying students to submit the comments.

“The topics covered included a user complaining that his girlfriend’s HTC One X phone was constantly crashing, and how Samsung’s Galaxy Note phone was superior to HTC’s Sensation XL handset,” a report said at the time.

As the FTC began its investigation, Samsung Taiwan appeared to all but confess to its underhand tactics when it announced on its Facebook page it’d “ceased all marketing activities that involve the posting of anonymous comments.”

In an effort to take some heat out of the situation, it added that it would change its marketing strategy to fall in line with Samsung’s philosophy of “transparent and honest communications with consumers.” But the FTC was having none of it, slapping Samsung with the fine on Thursday.

According to the FTC, two Taiwanese trading companies working for Samsung – OpenTide Taiwan and Sales and Profit International – orchestrated the online campaign, and as a consequence were fined around $100,000 and $1800 respectively.

Not the first time

This isn’t the first time the Korean tech giant has been in trouble with Taiwan’s Fair Trade Commission. Earlier this year it received a fine of just over $10,000 when it was found to have included “misleading” information in an ad for its Galaxy Y Duos GT-S6102 Android smartphone, while in September last year Toshiba Samsung Storage Technology (a joint-venture company) – together with a number of other firms – was fined for fixing prices of optical disc drives.

As for HTC, it has enough on its plate at the moment without having to deal with fake forum comments from paid posters blasting its products. The handset maker earlier this month posted its eighth straight drop in quarterly sales as it struggles to compete with Chinese phone makers, as well as Apple and, of course, Samsung, which on Friday happened to announce record profits in its latest financial report.