Tai Fook denies gift scheme breaks rule on commission rate

Tai Fook Securities is to use its ties with related companies New World Telephone and Chow Tai Fook Jewellery to boost its business, according to the broking firm.

But it has denied suggestions by rival brokers that its efforts to win new business are in breach of the stock exchange's minimum commission rate of 0.25 per cent.

Tai Fook Securities deputy managing director Lennon Chan Wing-luk said the firm planned to launch a score card on which clients could accumulate points according to their trading volume.

'Then they can use [their points] to redeem a wide range of commodities and services sponsored by the brokerage's related companies New World Telephone and Chow Tai Fook Jewellery.' Mr Chan said the redeemable items would include mobile handsets, telephone air time, jewellery and even his personal 'paid phone tips' on stock investments.

The points scheme is scheduled to kick off in one or two months.

Tai Fook Securities is controlled by the Cheng family of New World Development. The family also controls Chow Tai Fook Jewellery.

Some brokers allege the scheme will effectively reduce Tai Fook's commission rate below the stock exchange's minimum 0.25 per cent rule.