On Monday, Taiwanese authorities said they had launched an investigation into allegations that South Korean tech giant Samsung hired students to post malicious comments about local rival HTC online.
Taiwanese Fair Trade Commission stated that a case was set-up last week after they received the complaints.
Some media reports on a post in an online forum on April 1 alleged that said Samsung hired workers in Taiwan to open several sock-puppet accounts as part of a marketing campaign to promote its new flagship phoneGalaxy S 4 in the country.
In the allegations, that Samsung, through its local agent, had hired students to write online articles attacking HTC and recommending Samsung cellphones.
Soon after the online forum post went viral, Samsung came out in defence and posted a statement on its official Facebook page in Taiwan noting that it regrets any inconvenience and confusion from the Internet event.
“Samsung Taiwan has halted all Internet marketing such as posting articles on websites,” the statement added.
Taiwanese Fair Trade Commission indicated that the probe would look into allegations that Samsung engaged in false advertising and that if the allegations were upheld, Samsung and its local advertising agent could face a fine of up to Tw$25 million ($835,000).
HTC, on the other hand, is mulling legal action against the company for this smear campaign. “We regret our competitor’s malicious attacks and efforts to discredit us. HTC values product innovation and design, and we do not rule out the possibility of taking appropriate actions to protect the interests of our company and customers if necessary.” the Taiwanese manufacturer noted in a statement issued by FTC revealed the on-going investigation against Samsung.
This is not the first action from Samsung that could face a fine, the company was earlier this year fined NT$300,000 by FTC for a misleading advertisement about the camera functions on Samsung’s Galaxy Y Duos GT-S6102 smartphone.