Swiss man gets suspended prison term for spying in Germany

FRANKFURT (Reuters) - A Swiss man was handed a suspended prison term of nearly two years and a fine on Thursday for spying on a German tax authority, in a case that has pitted Swiss bank secrecy against Germany’s clampdown on tax evasion.

The penalty was relatively modest as spying for a foreign state is punishable in Germany by up to five years in prison, but the Frankfurt court said the man, identified only as Daniel M., had no prior convictions and had made a full confession.

Daniel M., 54, had tried to get the personal contact details of German tax officials for Swiss intelligence, which wanted to prosecute them for obtaining secret bank data.

German states including the one in question, North Rhine-Westphalia, have over the past few years gotten hold of CDs containing details of bank accounts held secretly in Switzerland by Germans hoping to avoid tax.

Swiss authorities say this amounts to the theft of business secrets, while German officials say they are combating illegal tax evasion.

Lawyers for Daniel M., whose spying activities lasted from 2011 until 2015, had argued that their client was simply a “patriot” caught between two ideologies.

The court, which handed him a suspended prison term of a year and 10 months and a fine of 40,000 euros ($46,392), acknowledged that he had suffered considerable financial damage since being detained in Frankfurt in May.

But it also criticized his cooperation with Swiss intelligence over a period of at least two and a half years.

“The depiction of the defendant’s actions as those of a Swiss patriot did not convince the court, especially because tax evasion, the reason for the tax officials’ actions, is not considered morally protected behavior in Switzerland either,” the court said in a statement.

The Swiss Banking Act requires employees of Swiss-regulated banks to keep client information confidential, but a number of staff have leaked account details to foreign authorities in the past decade as Western governments crack down on tax evasion.

Whistleblowers and new disclosure standards have proven costly for Swiss banks, which have suffered hundreds of billions of dollars in outflows as a result. Over a third of Swiss private banks have permanently closed.

Reporting by Maria Sheahan; Editing by Gareth Jones