FTC slams a 400 million won fine on Samsung

South Korea-based, Samsung Electronics have had to, reportedly pay through the nose for having allegedly created roadblocks during an inquiry as part of an investigation by the Fair Trade Commission (FTC) looking into deceptive mobile pricing practices. In fact, if a report by The Korea Herald is anything to go by then the fine Samsung have had to pay is the highest that FTC has fined anyone before for obstructing an official investigation, i.e. 400 million won (US$356,000). The report states that when the investigators were on, especially during an on-site visit, the South Korean company’s management and other employees with help from the security officials delayed investigators and they not only managed to delete data on computers, but also provided the investigators with false data. The investigation, in question was being carried by FTC to gauge the mobile pricing practices followed by Samsung Electronics, SK Telecom, KT, LG U+, Pantech and LG Electronics. The FTC, in its statement made it clear that the aforementioned companies had reportedly joined forces secretly and inflated the prices of cell phones and later advertised to the consumers that they were offering these phones at good discount rates, often leading the clueless consumer to believe that they were getting a good bargain.

Fined heavily!

According to the report, the FTC slapped a collective fine of 45.3 billion won on the companies for having indulged in less than honest mobile pricing practices. In context to the disruption allegedly caused by Samsung Electronics with a view to delay the probe, the FTC stated that in the future such instances would be dealt with more fiercely. It issued a warning stating that under the revised rules formulated, last month, those disrupting  an official probe, as such, would be liable to serve a prison sentence of less than three years and a fine of up to 200 million won. The reports of Samsung being fined heavily, and moreso about the allegations of them having disrupted the probe and indulged in questionable mobile pricing techniques is surely not doing any good to the future prospects of the company. 

More from News & Analysis

What is the US HIRE Bill and why is India’s $250-billion IT sector worried? Is the internet dead? What's this theory that OpenAI's Sam Altman says might be true?

South Korea-based, Samsung Electronics is one of the world’s most popular smartphone makers in the country, and the company has in the recent past enjoyed unadulterated love from buyers, globally. In fact, the company’s highly popular, Galaxy S II smartphones are being considered second to only the mammoth iPhone. Instances such as this would undoubtedly affect the company’s customers big time, and looks like Samsung will have to scramble around to regain lost love.