Germany drops espionage case against senior Swiss intelligence official

September 4, 2018 by Leave a comment

Paul ZinnikerGermany has dropped a criminal case against the second-in-command of Switzerland’s intelligence agency, who was accused by Berlin of authorizing an espionage operation against the German tax collection service. A year ago, Germany launched an unprecedented investigation into three senior officials of Switzerland’s intelligence agency, the Federal Intelligence Service (NDB). The probe was launched on suspicion that the Swiss officials masterminded a spy operation against German tax investigators who were probing the activities of Swiss banks. The German probe was launched three months after authorities in Germany arrested a Swiss intelligence officer, identified only as “Daniel M.”, for engaging in espionage on German soil.

The German government believes that billions of euros have been deposited by its citizens in banking institutions in European tax-havens like Liechtenstein, Switzerland or Monaco. For the past decade, German authorities have resorted to bribing whistleblowers in offshore banks in order to acquire internal documents that reveal the identities of German citizens who are hiding their money in foreign bank accounts. It is estimated that over a hundred million dollars have been paid to whistleblowers by German authorities since 2006. The latter argue that the proceeds collected from unpaid taxes and fines more than justify the payments made out to whistleblowers. But the Swiss government has strongly criticized Berlin for encouraging Swiss banking sector employees to steal internal corporate information that often breaks Switzerland’s stringent privacy laws. It is believed that the NDB has been instructed by the Swiss government to monitor efforts by German tax-fraud investigators to approach potential whistleblowers working in the Swiss banking sector.

The man identified as “Daniel M.” appears to be one of several Swiss spies who have been collecting information on the activities of German tax investigators. For a while it appeared that German counterintelligence officials were intent on targeting Paul Zinniker (pictured), Deputy Director of the NDB. They claimed that Zinniker was the main support officer of the operation that “Daniel M.” was participating in when he was arrested in Germany in 2017. According to the Germans, it was Zinniker’s who conceived the operation in 2011. But on Monday a spokesman for Germany’s federal prosecutor told the Swiss News Agency that Berlin dropped the case against Zinniker back in June. The revelation came less than 48 hours after a report in the Sunday edition of the Swiss newspaper Neue Zürcher Zeitung claimed that the charges against Zinniker would be dropped. According to the German federal prosecutor’s office, the case against the Swiss spy official was dropped because of the lack of cooperation by Swiss authorities, which made it impossible to prove that Zinniker was indeed the mastermind of the espionage operation against Berlin.

► Author: Joseph Fitsanakis | Date: 04 September 2018 | Permalink

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Germany investigates Swiss intelligence officers over espionage claims

August 16, 2017 by Leave a comment

Germany SwitzerlandGermany has launched an unprecedented investigation into three officers of Switzerland’s intelligence agency on suspicion that they spied on German tax investigators who were probing the activities of Swiss banks. News of the investigation comes three months after authorities in Germany arrested another Swiss intelligence officer, identified only as “Daniel M.”, for engaging in espionage on German soil. German media report that the three unnamed men are officers of Switzerland’s Federal Intelligence Service (NDB). They are suspected of engaging in the same type of activity as “Daniel M.”, namely monitoring German tax-fraud investigators.

The German government believes that billions of euros are deposited by its citizens in banking institutions in European tax-havens like Liechtenstein, Switzerland or Monaco. For the past decade, German authorities have resorted to bribing whistleblowers in offshore banks in order to acquire internal documents that reveal the identities of German citizens who are hiding their money in foreign bank accounts. It is estimated that over a hundred million dollars have been paid to whistleblowers by German authorities since 2006. The latter argue that the proceeds collected from unpaid taxes and fines more than justify the payments made out to whistleblowers. But the Swiss government has strongly criticized Berlin for encouraging Swiss banking sector employees to steal internal corporate information that often breaks Switzerland’s stringent privacy laws. It is believed that the NDB has been instructed by the Swiss government to monitor efforts by German tax-fraud investigators to approach potential whistleblowers working in the Swiss banking sector.

According to German media, the investigation against the three NDB officers was launched earlier this month. The news is likely to further complicate relations between Berlin and Bern. The two governments have been at loggerheads since the arrest of “Daniel M.”. Switzerland responded to the arrest by issuing arrest warrants for a number of German tax investigators. But Germany dismissed the move, saying it would refuse to comply with the warrants. On Monday, several European news media quoted German foreign minister Sigmar Gabriel, who described the alleged activities of the NDB as “incredible” and warned that the ongoing dispute between Germany and Switzerland could “wreck” their bilateral relationship.

► Author: Joseph Fitsanakis | Date: 16 August 2017 | Permalink

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Industrial espionage damages a country’s long-term productivity, study finds

August 1, 2017 by 1 Comment

StasiState-sponsored industrial espionage aimed at stealing foreign technical secrets may boost a country’s technological sector in the short run, but ultimately stifles it, according to the first study on the subject. The study is based on over 150,000 declassified documents belonging to the East German Ministry for State Security, known as Stasi. The now-defunct intelligence agency of communist-era East Germany was known for its extensive networks of informants, which focused intensely on acquiring technical secrets from abroad.

The history of industrial and economic espionage by governments is indeed extensive. It includes lucrative efforts by the United States to steal industrial production methods from Europe in the 19th century, and successful attempts by the Soviet Union to steal atomic technology from the American-led Manhattan Project in the 1940s. But there have been no systematic attempts to evaluate the effect of state-sponsored industrial espionage on the entire economy of the sponsoring nation –until now.

This new study –the first of its kind– was carried out by two economists, Erik Meyersson, from the Stockholm School of Economics in Sweden, and the Spain-based Albrecht Glitz of Pompeu Fabra Univeristy in Barcelona. The two researchers describe their preliminary findings in a working paper entitled: “Industrial Espionage and Productivity”, published by the Institute of Labor Economics in Bonn, Germany. Its findings are based on an analysis of nearly 152,000 declassified industrial-espionage-related communiqués sent by Stasi spies to their handlers between 1970 and 1988. The communiqués were examined with reference to their date of authorship and the content-descriptive keywords appended to them by the Stasi.

The report concludes that stealing industrial secrets can boost a nation’s economic activity in the short run. However, in the long run, a nation’s strategic focus on industrial espionage tends to impede homegrown research and development, and ultimately stifles technological productivity on a national scale. This is because “easy access to secrets” from abroad tends to “discourage both state and private investment in research and development”, according to Meyersson and Glitz. That is precisely what happened to East Germany, argues the report. The country’s total factor productivity (TFF –the growth of its output measured in relation to the growth in inputs of labor and capital) rose significantly as a result of its industrial espionage.That was especially noticeable in the digital electronics sector, where the output gap between East and West Germany was narrowed by a fourth. However, that trend was temporary, and East Germany was never able to develop an organic digital-electronics industry. Industrial espionage is like “research and development on cocaine”, professor Meyersson told Science, the magazine of the American Association for the Advancement of Science. “Maybe you can have a little bit of fun with it, but it’s not good for you in the long run”.

► Author: Joseph Fitsanakis | Date: 01 August 2017 | Permalink

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Swiss officials defend alleged spying on German tax-fraud investigators

May 4, 2017 by Leave a comment

SwitzerlandSenior Swiss government officials, including the defense minister and the director of the country’s intelligence agency, have defended Switzerland’s right to spy on European tax-fraud investigators who meddle in Swiss affairs. Earlier this week, German authorities announced the arrest of a Swiss national who was allegedly spying on the activities of German tax-fraud investigators in Frankfurt. According to German officials and media reports, the man, identified only as Daniel M., is an employee of the Swiss Federal Intelligence Service. The agency, known by its German-language initials, NDB, is Switzerland’s main intelligence organization.

As intelNews reported on Monday, Daniel M. was said to be monitoring the activities of German tax-fraud investigators who have been trying for years to stop German citizens from having secret bank accounts abroad. In the past decade, German authorities have paid nearly $100 million to employees of Swiss banks in return for information about the identities of German bank account holders in the small alpine country. The Swiss government has strongly criticized Berlin for encouraging Swiss banking sector employees to steal internal corporate information, a practice that goes against Switzerland’s stringent privacy laws. On Tuesday, Germany’s Foreign Minister, Sigmar Gabriel, summoned Switzerland’s ambassador to Germany, Christine Schraner Burgener, to the Foreign Ministry, in order discuss Daniel M.’s arrest. A press statement that the Foreign Ministry sent on Tuesday to the German media said that the meeting had been called “in the interest of German-Swiss friendship”.

But the Swiss do not appear to be interested in discussing. On Tuesday, Markus Seiler, Director of the NDB, defended his agency’s right to spy on anyone who “uses illegal methods in Switzerland to steal state or business secrets”. Seiler, who was speaking in Bern, classified all such practices as espionage targeting the the Swiss economy. Asked by reporters whether Daniel M. was an NDB employee, Seiler said he could not comment. But he defended the NDB’s right to “fight the theft of business secrets” and “uphold Swiss laws”. He also refused to specify whether the NDB is active in Germany, stating instead that the agency is “active at home and abroad”. Switzerland’s Minister of Defense, Guy Parmelin, who supervises the NDB’s activities, was equally general when asked to discuss the arrest of Daniel M. He said simply that he and other Swiss government officials had to “protect [the NDB’s] methods and sources”.

► Author: Joseph Fitsanakis | Date: 04 April 2017 | Permalink

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Germany arrests Swiss spy who was monitoring tax-fraud investigators

May 1, 2017 by Leave a comment

Frankfurt AirportAuthorities in Germany have announced the arrest of a Swiss national who was allegedly spying on the activities of German tax-fraud investigators in Frankfurt. According to prosecutors in the German state of Hesse, of which Frankfurt is the largest city, the Swiss man was arrested on Friday and is currently in custody. He has been identified only as Daniel M., and is believed to be in his mid-50s. According to news reports, German counterintelligence officers had been monitoring the suspect for over a year. They were issued a warrant for his arrest in December of last year, but waited until he was on German soil to arrest him. He was arrested at Frankfurt Airport.

German federal prosecutors said simply that Daniel M. was employed in the financial and banking sectors of Germany until early 2012. However after that time, he is believed to have been employed by “the intelligence service of a foreign power”. German officials refused to identify the “foreign power”. However, the Berlin-based German newspaper Die Welt said on Sunday that the Swiss man arrested on Friday is an employee of the Swiss Federal Intelligence Service. The agency, known by its German-language initials, NDB, is Switzerland’s main intelligence agency, tasked with safeguarding the security of the small alpine nation by collecting and analyzing information.

The question is, what was a Swiss spy doing in Germany, and why was he arrested? According to Die Welt, Daniel M. was monitoring the activities of German tax-fraud investigators who have been trying for years to stop German citizens from having secret bank accounts abroad. The German government believes that billions of euros are deposited by its citizens in banking institutions in European tax-havens like Liechtenstein, Switzerland or Monaco. For the past decade, German authorities have resorted to bribing whistleblowers in offshore banks in order to acquire internal documents that reveal the identities of German citizens who are hiding their money in foreign bank accounts. It is estimated that over a hundred million dollars have been paid to whistleblowers by German authorities since 2006. The latter argue that the proceeds collected from unpaid taxes and fines more than justify the payments made out to whistleblowers. But the Swiss government has strongly criticized Berlin for encouraging Swiss banking sector employees to steal internal corporate information that often breaks Switzerland’s stringent privacy laws.

It is believed that Daniel M. was arrested while monitoring efforts by German tax-fraud investigators to approach potential whistleblowers working in the Swiss banking sector. Soon after the Swiss man’s arrest, officers from Germany’s Federal Criminal Police Office (BKA) searched a hotel room, several apartments and a number of business premises in Frankfurt and nearby cities. It is worth noting that Frankfurt is a major global financial center, which also hosts the headquarters of the European Central Bank. If found guilty, Daniel M. could face up to 10 years in prison for espionage.

► Author: Joseph Fitsanakis | Date: 01 May 2017 | Permalink

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Brazil builds direct Internet cable to Europe to avoid US spying

November 3, 2014 by 5 Comments

Proposed transatlantic cableBy JOSEPH FITSANAKIS | intelNews.org
The government of Brazil is to construct a transatlantic cable across the Atlantic Ocean in order to avoid having its Internet traffic to and from Europe intercepted by American intelligence agencies. According to reports, the fiber-optic cable will stretch for 3,500 miles from the northeastern Brazilian city of Fortaleza to the Portuguese capital Lisbon. It will cost the Brazilian government in excess of US$185 million, but it will allow the country’s existing Internet traffic to and from Europe to travel without going through cables owned by American service providers. According to Brazilian officials, the construction of the cable is among several steps announced by the Brazilian government aimed at disassociating its communications infrastructure from American companies. The move follows revelations made last year by American defector Edward Snowden that the US National Security Agency specifically targeted Brazilian President Dilma Rousseff’s personal communications as part of its intelligence-collection efforts targeting Brazil. In response to the revelations, Rousseff cancelled a planned official state visit to Washington and accused the US of having committed “a breach of international law and an affront” against Brazil’s sovereignty. The planned fiber-optic cable connection to Europe will be overseen by Telecomunicacoes Brasileiras SA, Brazil’s state-owned telecommunications conglomerate, known commonly as TeleBras. The company’s president, Francisco Ziober Filho, said in an interview last week that none of the $185 million that will be spent on the project will end up in the pockets of American companies. For over a year, experts have been warning that the Snowden revelations about the extent of the NSA’s global communications-interception activities might undermine the American telecommunications sector, insomuch as it could undercut America’s role and influence in global Internet governance. Many countries, Brazil included, are beginning to actively reconsider their dependence on US-managed Internet networks that host the content of social media sites, cloud computing databases, or telecommunications exchanges. Read more of this post

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News you may have missed #445

October 27, 2010 by Leave a comment

  • WikiLeaks files show Iranian involvement in Iraq. The latest WiliLeaks release of nearly 392,000 US military reports from Iraq shows, among other things, that Iran was a major combatant in the Iraq War. According to the documents, Tehran’s elite Quds Force trained Iraqi Shiite insurgents and imported weapons like Explosively Formed Projectile bombs into Iraq for use against civilians, Sunni militants and US troops.
  • WikiLeaks founder on the run. Julian Assange’s fate seems as imperiled as that of Private Bradley Manning, the 22-year-old former Army intelligence operative under detention in the US for leaking Iraq and Afghan war documents to WikiLeaks. Last Monday, Mr. Assange’s bid for a residence permit in Sweden was rejected. His British visa will expire early next year.
  • Money problems of US spies may threaten US security. Elizabeth Bancroft The executive director of the US Association of Former Intelligence Officers, has suggested that government agencies should monitor intelligence service employees with security clearances, who may have fallen into bankruptcy during the ongoing economic crisis. Spy agencies are worried that financial problems might leave these employees open to bribery or blackmail.

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US officials sought ‘national security’ clause to keep bailout details secret

January 28, 2010 by Leave a comment

Securities and Exchange Commission logo

SEC logo

By IAN ALLEN | intelNews.org |
US officials in charge of regulating securities exchanges sought to apply a ‘national security’ clause to information relating to the government’s bailout of giant insurance company American International Group (AIG). Emails obtained by Reuters show that, in November of 2008, the New York Federal Reserve (NYFR), which administered the bailout, collaborated with AIG in requesting that US Securities and Exchange Commission (SEC) officials apply “special security procedures” to shield bailout-related information from public scrutiny. Instead of dismissing the –possibly illegal– request, SEC officials advised NYFR and AIG to publicly file heavily redacted versions of the documents in question, and request “confidential treatment” for the redacted portions, citing ‘national security’ clauses. Read more of this post

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