Company fined HK$200,000 over misleading property adverts
Century Rise had promoted its development The Graces at Providence Bay in across the front page of Sing Tao Daily
A property company was fined HK$200,000 by a court on Thursday for running misleading newspaper advertisements that claimed the first 50 buyers of its new luxury flats would get discounted prices, when in fact none were eventually sold as advertised.
Century Rise had promoted its development The Graces at Providence Bay in Tai Po at HK$14,563 per sqft across the front page of Sing Tao Daily and the inner pages of three Chinese newspapers on September 27, 2013.
But the Sales of First-hand Residential Properties Authority found the advertisements did not explain the discount nor detail the basis of calculation.
It was also discovered that none of the first 50 units were sold as promised when it was put on market on October 4 that year.
On Thursday, a company representative pleaded guilty to four summonses of causing an advertisement to be published which contained false or misleading information, an offence punishable by three years’ imprisonment and a HK$1 million fine.
Principal magistrate Ernest Lin Kam-hung said property developers cannot be condoned for such behaviour when home purchases are one of ordinary citizens’ biggest investments.
He was told that Century Rise ran the misleading promotion due to an oversight that was corrected four days after the advertisement in the publications.
Its lawyer claimed there was no intention to mislead the public as the company had also supplemented the advertisement with information on how unit prices were calculated in other pages of the paper.
Defence also said that it was a one-off event which took place when the company was still trying to adapt to the new law targeting dishonest sales practices, enforced in April 2013.
But the magistrate noted that the promotional exercise was not run on a small budget and its process must have gone through meticulous commercial calculations.
“It’s not like posting a notice downstairs promoting the sale of a property,” Lin continued. “Though the case particulars were not serious, one cannot rule out the possibility that there were citizens drawn by the advertisements to buy the property.”
Sentencing, he said, has to carry a deterrent effect to send the message that society will no longer allow such practices.
The high-end property, comprising 193 flats sized from 930 sqft to 3,001 sqft of saleable area, was a joint project of developers Nan Fung Group, Sino Land and Wing Tai Properties.