Samsung's US branch found guilty of misleading the US government, will pay a "hefty" fine
All US federal agencies and institutions are obliged by law to purchase and use only products that have been manufactured in either the USA or a country that is part of a trade agreement. Such countries, for example, are Mexico and South Korea, where Samsung has some large manufacturing facilities, but it appears that the devices it sold the government have been made in China. The problem is that the USA and China have not signed such an agreement.
Samsung's US branch allegedly provided certain federal agencies with misleading information. Interestingly enough, Samsung itself is not accused of this act, and only the company's US-based department will be accountable for this chicanery.
In order to settle down the charges, Samsung's US branch will have to part with some $2.3 million. This ruse wouldn't have been exposed if it wasn't for Robbert Simmons, a former Samsung employee and currently a whistle-blower, who revealed the scheme. Simmons will receive an yet-undefined portion of this sum of money.
Thanks for the tip, Mark!
source: Washington Post via Android Authority
4. fanboy1974 (Posts: 1193; Member since: 12 Nov 2011)
Correction; it gives you more reason to justify your hate for Samsung. I doubt you had any love for Samsung before this news broke. Am I correct?
All companies are guilty of something. Even the beloved Apple was found guilty by the US government for that e-book fiasco. Don't pretend that everyone plays by the rules.
17. engineer-1701d (Posts: 774; Member since: 13 Mar 2014)
You mean more reason to hate government they always have to have part of your hard earned money.
27. downphoenix (Posts: 2301; Member since: 19 Jun 2010)
I bet the fine will be cheaper than whatever it would have costed to manufacture the phones in the US, so Im sure this is a slap on the wrist.
2. ibap (Posts: 692; Member since: 09 Sep 2009)
I've liked some of their phones, but this behavior is complete garbage. There should be a bigger penalty.
And "...in a country, with which the USA..." - does not need a comma in that location.
15. Finalflash (Posts: 1673; Member since: 23 Jul 2013)
I know, another whistle blower, can't wait till they put a death threat on him and make him move to Russia to save his life.....OH WAIT, this one leaked the right kind of information.
7. joey_sfb (Posts: 2876; Member since: 29 Mar 2012)
Just show that US double standards prevail. Is Apple iPhone manufactured in the USA. Does it use parts that are manufactured in the US?
US Hypocrisy at its finest.
9. hunted (Posts: 323; Member since: 21 Sep 2011)
how to delete our owns comments in this website!!
10. RebelwithoutaClue (Posts: 686; Member since: 05 Apr 2013)
And do you know for a fact that US government departments are allowed to buy iPhones from China? You do know Apple also has factories in Mongolia, Taiwan and Korea. Perhaps they only sell iPhones from the approved factories without cheating. They don't ban Samsung devices, just the ones made in China....
11. tedkord (Posts: 4633; Member since: 17 Jun 2009)
They don't have factories in Mongolia (nor is there a free trade agreement with Mongolia or Taiwan), they source some parts from there.
IPhones are assembled in China. All of them. They're made from parts from around the world, but they're put together in China.
12. RebelwithoutaClue (Posts: 686; Member since: 05 Apr 2013)
Yet Foxconn has factories in Thailand, Malaysia, the Czech Republic, South Korea, Singapore, and the Philippines. And you say none of these are used to assemble the iPhone. Which basically means the US government can't buy iPhones.
13. joey_sfb (Posts: 2876; Member since: 29 Mar 2012)
What you said about Apple is directly applicable to Samsung. They share the same OEM manufacturers capacity.
14. RebelwithoutaClue (Posts: 686; Member since: 05 Apr 2013)
True and that's what this is about. Samsung told the US the phones they bought were from South Korea. But instead they were from China.
16. RebelwithoutaClue (Posts: 686; Member since: 05 Apr 2013)
28. RebelwithoutaClue (Posts: 686; Member since: 05 Apr 2013)
Ps a free trade agreement with taiwan is in the making, so I doubt phones from taiwan will be banned
nited_States_free_trade_agreem ents#Free_trade_agreements_in_ force
31. willard12 (Posts: 764; Member since: 04 Jul 2012)
This is great news from wikipedia. However, Taiwan is a territory of China and it is unlikely they will be permitted to enter into large multinational trade agreements.
8. fanboy1974 (Posts: 1193; Member since: 12 Nov 2011)
I will shut up once you cash you ebook settlement check from Apple.
6. tedkord (Posts: 4633; Member since: 17 Jun 2009)
Nail them. $2.3 million isn't hefty, it's pocket change. Make it $230 million.
18. joey_sfb (Posts: 2876; Member since: 29 Mar 2012)
Not a cent would goes into your pocket why would you care.
I am more concern what Samsung is going to bundle as Note 4 preorder free gifts.
22. tedkord (Posts: 4633; Member since: 17 Jun 2009)
Because illegal, immoral behavior should be punished, and the punishment should be large enough to deter repeat offense.
24. tedkord (Posts: 4633; Member since: 17 Jun 2009)
Got one, compete with wife, kids and job. Stop projecting.
30. domfonusr (Posts: 353; Member since: 17 Jan 2014)
Its more important than you think. Honesty and integrity are great attributes to strive for, and when a large company fails to keep such attributes, it destroys trust. Couldn't they have just been honest from the beginning, and admitted from the beginning that their stuff was made in China? Sure they could have. Would it have cost them a government contract? Who knows... maybe, maybe not. But the point is that this is now a violation of trust - Samsung claimed to make something in one place, even though it was actually made in another. This is a bigger deal to me than for most people, since I try hard to not buy too much that comes out of China, but especially stuff made in places like FoxConn in China. Is there anyone who doesn't make phones that have parts made in China? Probably not, but I'd rather know about it from the manufacturer before buying rather than learning about it afterward through a press leak or an investigation. Just because it seems like every company is a hypocrite on some level doesn't mean that we should discard honesty as a value.
19. Heatfan316 (Posts: 409; Member since: 21 Aug 2011)
230 million is still pocket change! Try 5-6 billion and that will wake them up.
26. tedkord (Posts: 4633; Member since: 17 Jun 2009)
The punishment has to fit the crime, too. You don't Institute the death penalty for jaywalking, or fine $100000 for a parking ticket.
20. amats69 (Posts: 1030; Member since: 12 Nov 2012)
Profit decline last quarter and then this? aww
21. Altair (Posts: 324; Member since: 02 Feb 2012)
Nothing new under the sun. Just another shame for Shamesung.
25. wilsong17 (Posts: 865; Member since: 10 Mar 2013)
Why be shameful if other company have do it
29. kevin91202 (Posts: 37; Member since: 08 Jun 2014)
"All US federal agencies and institutions are obliged by law to purchase and use only products that have been manufactured in either the USA or a country that is part of a trade agreement." -PA
That's not true.