Samsung's US branch found guilty of misleading the US government, will pay a "hefty" fine

Samsung's US branch found guilty of misleading the US government, will pay a
Uh-oh. It appears that Samsung's American Division has been charged with deceiving the US government. The tech giant has mislead the USA's most important institution into thinking that the Samsung-branded devices it had bought had been manufactured in a country, with which the USA has previously signed a fair-trade agreement.

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

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30 Comments

1. marcski07

Posts: 600; Member since: Apr 25, 2014

more reason to hate samsung,

4. fanboy1974

Posts: 1345; Member since: Nov 12, 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 unregistered

You mean more reason to hate government they always have to have part of your hard earned money.

27. downphoenix

Posts: 3165; Member since: Jun 19, 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: 867; Member since: Sep 09, 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.

3. itsdeepak4u2000

Posts: 3718; Member since: Nov 03, 2012

OMG!!!

15. Finalflash

Posts: 4063; Member since: Jul 23, 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.

5. rantao333

Posts: 346; Member since: May 21, 2013

fandroid keep quiet

7. joey_sfb

Posts: 6794; Member since: Mar 29, 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: 403; Member since: Sep 21, 2011

how to delete our owns comments in this website!!

10. RebelwithoutaClue unregistered

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: 17357; Member since: Jun 17, 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 unregistered

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: 6794; Member since: Mar 29, 2012

What you said about Apple is directly applicable to Samsung. They share the same OEM manufacturers capacity.

14. RebelwithoutaClue unregistered

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.

28. RebelwithoutaClue unregistered

Ps a free trade agreement with taiwan is in the making, so I doubt phones from taiwan will be banned http://en.wikipedia.org/wiki/United_States_free_trade_agreements#Free_trade_agreements_in_force

31. willard12 unregistered

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: 1345; Member since: Nov 12, 2011

I will shut up once you cash you ebook settlement check from Apple.

32. InspectorGadget80 unregistered

Sh(-(-p should stop trolling.

6. tedkord

Posts: 17357; Member since: Jun 17, 2009

Nail them. $2.3 million isn't hefty, it's pocket change. Make it $230 million.

18. joey_sfb

Posts: 6794; Member since: Mar 29, 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: 17357; Member since: Jun 17, 2009

Because illegal, immoral behavior should be punished, and the punishment should be large enough to deter repeat offense.

23. GalaxyS5

Posts: 430; Member since: Aug 05, 2014

umm. get a life?

24. tedkord

Posts: 17357; Member since: Jun 17, 2009

Got one, compete with wife, kids and job. Stop projecting.

30. domfonusr

Posts: 1085; Member since: Jan 17, 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.

20. amats69

Posts: 1527; Member since: Nov 12, 2012

Profit decline last quarter and then this? aww

21. Altair

Posts: 367; Member since: Feb 02, 2012

Nothing new under the sun. Just another shame for Shamesung.

25. wilsong17 unregistered

Why be shameful if other company have do it

29. kevin91202

Posts: 642; Member since: Jun 08, 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.

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