Samsung Caught Astroturfing: Taiwanese FTC Fines Galaxy S4 Maker $340,000 For Fake Negative Reviews Of HTC Products

The Fair Trade Commission of Taiwan levied a $340,000 (NT $10 million) fine on Samsung Electronics Co. (OTCMKTS: SSNLF) on Thursday for astroturfing, the practice of disguising sponsored messages as disinterested reviews. The commission found that Samsung organized an Internet campaign that paid for negative online reviews of HTC products while praising Samsung products.

Taiwan’s FTC launched the investigation in April after people accused Samsung of hiring users to make negative comments on pro-Apple and pro-HTC blogs. At the time, Samsung admitted an “unfortunate incident” that happened “due to insufficient understanding.”

Samsung maintained that it ceased all of these “marketing activities,” but the FTC found that Samsung had hired “a large number” of writers to continue the negative posts. The FTC ruled that the Samsung campaign violated fair trade rules by undermining HTC’s reputation.

This is the second fine the FTC has given Samsung this year. In January, Samsung was fined about $10,000 (NT $300,000) for false advertising of the Galaxy Y Duos GT-S6102 phone.

The FTC also fined two local Taiwanese marketing companies $100,000 each for their roles in the campaign.