Hong Kong’s No. 2 finance official bought two properties at the maximum mortgage ceiling in 2010, less than a month before the government announced tighter lending rules.
Undersecretary for Financial Services and the Treasury James Lau avoided an additional HK$1.62 million (US$208,831) down payment because of his “smart timing”, news website hk01.com reports.
Lau was chief executive of the Hong Kong Mortgage Corp. at the time of the purchases.
Lau said he only learned about the new mortgage rules after he had signed provisional purchase agreements on the two flats.
However, he said he failed to declare that both flats were under the maximum mortgage ceiling of 70 percent.
The government cut the mortgage ceiling to 60 percent on Aug. 13, 2010.
On Thursday, Lau denied having had advance knowledge of the mortgage rule changes.
Lau said he learned about the new rules on July 29, four days after the last of the two purchase agreements was signed, according to the Hong Kong Economic Journal.
He said he did not receive preferential treatment during the sale process and that he signed the mortgage documents at the same interest rate offered to other borrowers.
Land Registry records show that Lau, his wife Stella Lau, principal of Diocesan Girls’ School, and their daughter Queenie Lau, bought two flats in Argyle Street and Waterloo Road for HK$6.18 million and HK$9.98 million, respectively.
The market price of the two flats has since risen to HK$9.2 million and HK$13.82 million.
In March 2003, former financial secretary Antony Leung was found to have bought a Lexus sedan for HK$790,000, two months before he announced a sharp increase in first-registration vehicle tax.
Leung was forced to resign over the scandal and donated HK$190,000 to charity, twice the amount he saved from the car purchase.
– Contact us at [email protected]