Spies crowd into Switzerland amid financial crisis

Zurich — Thanks to its status as a financial centre, Switzerland is seeing a sharp rise in spying activities amid the global economic crisis, the Swiss intelligence service told AFP.

"We have seen a general interest for financial information," Juerg Buehler, who heads the service, part of the defence ministry, said in an interview.

"This trend is reinforced with the financial crisis and competition between financial centres," notably through cyber-attacks by hackers looking to penetrate banks’ networks, he said.

Swiss authorities said they had to ban 21 foreigners holding diplomatic status in 2008 from entering the country, compared to eight in 2007. In 2006, only two were blocked.

In its annual report, the internal information service said: "Foreign intelligence services continue to engage in all forms of espionage activities in Switzerland.

Most spies infiltrate Switzerland posing as diplomats or journalists, said the department.

"In this way, they can gather information and contact people without raising suspicions," said the report.

It noted that those in the diplomatic services are most likely to be spies, including translators and interns.

Cyber-attacks have also been detected, said the service.

Some of these cyber-attacks come from "Asia or pass by China although it is impossible to tell for sure which country it is coming from," said Buehler, whose department of 120 people is part of the Swiss defence ministry.

"Their interest in the country as a location for research facilities and enterprises in the sector of top-level technology remains unabated," said the report.

"Also, the fact that many international organisations are established in Switzerland makes the country an attractive target of foreign intelligence services, as does its position as an important commodities trading and finance centre," it added.

Switzerland’s tiny neighbour Liechtenstein had to face the wrath of large foreign states including the United States over allegations of abetting tax evasion after German spy services got hold of some of its foreign bank clients.

A former employee of the LGT bank in February 2008 leaked documents to the German secret service, leading to a massive tax probe and clampdown by major economic powers.

That eventually forced not just Liechtenstein but also Switzerland and other financial centres to make concessions on strict banking secrecy rules.

The LGT affair was "a warning for the whole financial sector," said a spokesman for the Association of Swiss bankers.

It showed the "dangers" that could hit banking institutions if they were not sufficiently protected.

Given the rising risks of foreign intelligence penetration, Buehler said his service is trying to make the banking industry aware of the dangers.

But he acknowledged that "we cannot have police patrolling in front of every bank."

AFP/Expatica