Merkel under attack over plan to buy stolen bank data

Chancellor Angela Merkel faced a blistering political row with Switzerland and her own Christian Democrats yesterday over a plan to buy stolen Swiss bank data naming hundreds of German tax evaders who have millions of euros in secret accounts.

A CD identifying around 1500 Germans who have illicit Swiss accounts was procured by a former employee at the Geneva branch of HSBC bank. The disc, which could return an estimated €200 million ($393 million) in lost revenue, was offered to the German Government for €2.5 million at the weekend.

Merkel and her Finance Minister, Wolfgang Schuble, initially greeted the offer as a welcome means of bringing tax evaders to book. "Like everyone else, I think that tax evaders need to be uncovered," Merkel said.

Yesterday, however, it became clear that Germany's apparent readiness to buy stolen bank data had plunged Merkel into a row with Switzerland and her own conservative Christian Democratic Union. Leading members of the party described the plan to buy the CD as immoral.

Hans-Rudolf Merz, the Swiss Finance Minister, suggested that relations between the two countries would suffer. "What Germany is doing is punishable by law in Switzerland," he said.

Adrian Amstutz, a leading member of the right-wing Swiss People's Party, said Merkel's announcement meant that relations between Switzerland and Germany would "sink to a level not seen since the era of Hitler", and demanded that she revoke her plan.

Leading members of Merkel's Christian Democrats agreed. "We are signalling to these data thieves: we will buy what you steal," warned Kurt Lauk, president of the business council of the CDU. "The state should be trying to arrest this man."

However Merkel's stance has been fully backed by Germany's Social Democrats, the Green Party and the police.

German tax evaders are estimated to have €175 billion concealed in Swiss bank accounts.

An opinion poll published yesterday showed that 57 per cent of Germans supported the Government plan to buy the CD; 43 per cent were against.

Siegfried Kauder, a Christian Democrat legal expert, said the data was "unusable" in court. But Merkel and her Finance Minister argued yesterday that the whistleblowing tax CD was no different from a similar case in 2008 when Germany paid €4.2 million for stolen bank data procured by a former employee at a Liechtenstein bank.

The information was used to identify around 600 tax evaders, including former Deutsche Post boss Klaus Zumwinkel. He was fined €1 million for tax evasion and given a two-year suspended jail term.

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