Google Penguin was introduced on April 24th 2012. Many websites got caught out by it.
Prior to Penguin, one of the primary ways to improve the ‘authority’ of a web page was to get websites to link to it. The problem with this was that a whole links industry had sprung up aiming to cheat the system (see Black Hat optimisation).
What not to do
The links industry had got into the habit of setting up lots and lots and lots of websites with ‘thin content’ (see Google Panda), for the very purpose of putting links to their clients' websites. Plumbers, double-glazing companies, nuts and bolts manufacturers, poets, high-class jewellery outlets would all have links coming from strange sites about keep-fit websites for Inuits in Madagascar. It wasn’t ideal - but it succeeded in cheating the system. So Google released ‘Penguin’.
What Penguin did
If you had a website that had a portion of incoming links from dodgy websites, there was a strong chance your site would be penalised.
The problem with Penguin
The problem is that website owners aren’t actually in control of links from other websites. And a strange new links industry had the potential to proliferate - one that was decided ‘Black Hat’. If you could get penalised by links from dodgy websites, what if your competitors had more links from dodgy websites? Partly because of this, Google set up the disavow tool to stop it including certain websites when evaluating your own site.
The bottom line
At the end of the day, gaining unnatural links is now a bad thing. The only good links are from sites that are truly relevant to what you do.