Samsung has admitted paying students to post scathing reviews about Taiwanese rival HTC handsets on websites in Taiwan.

Samsung said its Taiwanese operation displayed “insufficient understanding of [the firm’s] fundamental principles” and has vowed to “cease all marketing activities that involve the posting of anonymous comments”.

Earlier this week, Taiwan’s Fair Trade Commission (FTC) announced it would investigate the allegations. It said that the investigation could lead to penalties for false advertising and a potential fine of up to TW$25m ($834,000).

In a statement to the press, Samsung Electronics said it remains committed to engaging in “transparent and honest communications with consumers” as outlined in its online communications policy.

“The recent incident was unfortunate, and occurred due to insufficient understanding of these fundamental principles,” the firm added.

“Samsung Electronics Taiwan (SET) has ceased all marketing activities that involve the posting of anonymous comments, and will ensure that all SET online marketing activities will be fully compliant with the company’s Online Communications Credo,” the firm added.

“We regret any inconvenience this incident may have caused. We will continue to reinforce education and training for our employees to prevent any future recurrence.”