Wednesday, October 22, 2014   




Lam charity not welcome

Eddie Luk and Victor Cheung

Friday, November 02, 2012


The property agent who sold a luxury Mid-Levels flat for Franklin Lam Fan- keung has rejected the Executive Council member's claim that the difference in asking and selling price - HK$70,000 - from the sale was intended for donation to charity.

Centaline Property Agency last night also revealed that the "vendor" had proposed to offer the price difference as additional commission in the sale of the Casa Bella flat, but the firm turned it down.

New Exco member Lam is under pressure to explain the sale of two flats - both in Casa Bella on Caine Road - just weeks before the government's surprise announcement last Friday of measures to cool the property market.

Centaline's statement came hours after Lam - a top property analyst - changed his earlier account and blamed miscommunication with his wife for the confusion. He said the price difference was instead a donation to a charity under Centaline.

Centaline said that the purchase contract specified the commission as HK$80,000 payable by the buyer and HK$99,500 by Lam. It also dismissed Lam's clarification that Centaline's charity accepted the cash, saying it has always been its practice not to directly accept donations from clients.

Lam earlier said he had set the minimum price and the extra amount was paid to the agent as an incentive to sell the flat faster. The flat was sold for HK$9.95 million.

He denied the commission was illegal after the Democratic Party lodged a complaint with the Independent Commissi
on Against Corruption. Lam said he did not know the extra HK$70,000 was a donation to charity because his wife handled it.

Asked about his conflicting accounts by a radio program yesterday morning, Lam explained: "It was Mrs Lam who handled the entire transaction. Mrs Lam told [the agent] we did not want to earn the extra amount and suggested giving the additional amount as a commission instead."

Lam said the agent then suggested the commission could be donated for charitable purposes and his wife then gave the money to Centaline Charity Fund.

Lawyers specializing in conveyancing said, in general, buyers should be told of any special arrangements, otherwise the sellers may violate anti-bribery laws.

"It can be unfair to a property buyer as he or she is not aware the extra sum of money will be given to the agent by the seller. The buyer does suffer a loss in the transactions," said solicitor Leung Wing-hang.

And it is rare for a seller to pay the difference between the minimum price and the eventual sale price as a commission to the agent, Leung said. Solicitor Wong Kwok-tung said the rebate may be illegal if the buyer was not informed.

An industry insider said extra commission may be because vendors want to sell the flats at higher than market prices, or they want to do it quickly. "It looks appealing to the agent, but they are usually not easy tasks ... I don't think donating the price difference to charity would add any incentive for agents," the insider said

Meanwhile, in a Legislative Council question-and-answer session, Chief Executive Leung Chun-ying reiterated that no Exco member knew in advance of the property curbs - including a new 15 percent stamp duty for non-local buyers.


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