Liechtenstein upset over German use of data

19th February 2008, Comments 0 comments

The country’s prince says that Berlin is whipping up media hysteria against his country.

Berlin -- One of the world's tiniest nations, Liechtenstein, voiced outrage Tuesday at a German spy-agency hit, hours before its prime minister, Otmar Hasler, was to arrive in Berlin for talks.

Prince Alois, 39, who rules Liechtenstein in the name of his retired father, Hans-Adam II, said Berlin's payment for data on German tax evaders had benefited a thief convicted of stealing that data in the principality.

Speaking in the capital Vaduz, Alois charged that Berlin was whipping up media hysteria against his tiny German-speaking, Alpine principality, which has a population of only 35,000.

Berlin said this week that agents of its BND external intelligence agency paid "4 to 5 million euros" (about 7 million dollars) for a disc containing evaders' names and correspondence.

Dawn police raids on wealthy suspects in cities in Germany continued Tuesday.

Though it has about the same population as Monaco, Liechtenstein is a comparatively drab place that can only offer tourists skiing and hill walks.

Its economy is allegedly based on its tax-haven operations for the rich of Germany, a nation 2,400 times its size with a population of 82 million.

The Wall Street Journal said Vaduz believed Berlin had obtained data taken in 2002 by Heinrich Kieber, a former employee of Liechtenstein's largest bank, LGT Group, who was now believed to live in Australia.

The prince did not mention Kieber by name, but said he had taken data on 500 bank clients.

"We don't know what the German data is, but it would appear it is the same data from back then," he said.

The New York-based newspaper said someone had been offering the data for sale for the past 18 months.

David Crawford, a WSJ journalist, told Germany's N24 television he understood the United States was also using the data.

Prince Alois said his country was facing "an utterly disproportionate attack" and was "under bombardment from a great power." He charged that Berlin was "fencing stolen goods on a vast scale."

At a news conference, he added that the crisis was an affront on the eve of Hasler's scheduled visit.

Hasler was set to arrive in Berlin Tuesday and meet on Wednesday with Chancellor Angela Merkel.

In Germany, lawyers representing rich clients filed police charges Tuesday, alleging the German authorities had aided and abetted the crime of data theft.

The disclosure of the trusts in Liechtenstein highlights one type of tax-avoidance scheme.

Former revenue officials who "go over to the other side" and set up as accountants are among the players in the "national sport of tax avoidance," as Germans refer to it.

GfK, a surveys company, said 23 percent of Germans admitted to pollsters that they had evaded taxes.

The scandal broke last Thursday with raids on the home and office of Klaus Zumwinkel, 64, the chief executive of Deutsche Post, the worldwide logistics company and mail carrier.

Post, parent of the DHL parcels company, replaced him Monday with Frank Appel, 46, head of the group's logistics division.

Zumwinkel resigned and lost the salary he would have earned until his contract expired in November, Post sources said in Bonn.

Post was meanwhile rushing to reprint a purged version of its staff magazine, "correcting" a speech in which Zumwinkel had said managers had to lead by example, demonstrating the values their subordinates must follow.

DPA with Expatica

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