U.S.' German spy emailed Russia, report says

German Chancellor Angela Merkel, in an interview Saturday, accused the United States of using outdated Cold War intelligence methods but said that wouldn’t affect “cooperation” on projects.
German Chancellor Angela Merkel, in an interview Saturday, accused the United States of using outdated Cold War intelligence methods but said that wouldn’t affect “cooperation” on projects.

BERLIN -- The Cold War is long since over, and few nations have exhibited a stronger reaction than Germany against the modern surveillance state.

Yet recent weeks have brought fresh reminders that the Spy vs. Spy game goes on in Germany, which remains caught geographically and historically between Russia and the West. The espionage cases that have caused new strains between the United States and Germany grew, paradoxically, out of German concerns about renewed Russian intelligence activity. Based on German news reports and sketchy information provided by government officials on both sides of the Atlantic, the two cases also appear to be linked, at least tangentially.

The more troubling of the cases centers on a 31-year-old midlevel employee of the federal intelligence service who was arrested July 2. He was detained on suspicion of spying for Russia, but then surprised his interrogators by claiming to have passed 218 German intelligence documents to the United States.

That man, identified only as Markus R., first got on the radar of German counterintelligence on May 28, when he sent an email to the Russian Consulate in Munich offering information, the newspaper Suddeutsche Zeitung reported Saturday.

Since the Russian invasion of Crimea, senior German intelligence officials say, Moscow had stepped up activity in Germany, seeking information on Berlin's next steps, so counterintelligence was on alert for such contacts.

Markus R. was reportedly eager to impress the Russians and attached at least one intelligence document to his email: an anonymous denunciation of a Defense Ministry official as a Russian spy that had crossed his desk at the federal intelligence headquarters near Munich, according to Suddeutsche Zeitung.

German counterintelligence officials sought to ensnare Markus by replying to him from a false Russian email address, suggesting a meeting. Markus apparently did not take the bait, and the Germans, casting about for more clues, forwarded the Gmail address used by Markus R. to the Americans, asking whether they recognized it.

"There was no reply" from the Americans, said the newsmagazine Der Spiegel. Instead, Markus shut down the email address.

His arrest and subsequent admission that he had actually been working for the United States infuriated the Germans and embarrassed the U.S., especially given previous disclosures that the Americans had been eavesdropping on the communications of millions of Germans and had tapped the mobile phone of Chancellor Angela Merkel.

Markus R., according to German news media accounts citing unidentified government and intelligence officials, had already been working about two years for the Americans, reportedly receiving about $34,000 for those 218 documents. He had met with his handlers three times in Austria, apparently to avoid detection.

It seems he was not satisfied. Suddeutsche Zeitung, whose reporters have talked to Markus R.'s lawyer, depicted him as someone eager for more money and who apparently arranged a meeting with the Russians, prompting counterintelligence to detain him -- still thinking they were dealing with a spy for Moscow.

But there was yet another twist in store. The anonymous denunciation of the German defense official that Markus had included in his email to the Russians turned out to be at the heart of a separate case that German counterintelligence officials had been monitoring since August 2010, said Andre Hahn, a member of the parliamentary commission that oversees Germany's intelligence services.

The defense official, who has not been publicly named, had come under scrutiny after investigators received the anonymous tip saying he was working for the Russians. The investigators, according to some news reports, also found evidence that the man had taken trips paid for by an American friend.

But the evidence was apparently thin, and it was not until last week, in the wake of Markus R.'s arrest and the diplomatic strains it caused with the U.S., that the federal prosecutor sent police to raid the man's home and office. A day later, Germany demanded that the top U.S. intelligence official in Berlin leave the country, a step rarely taken by one ally against another.

But a senior German official said Friday that there might not be enough evidence to prosecute the second official for spying for either Russia or the United States.

The two sides are now beginning to turn to the task of repairing the German-American relationship.

German Foreign Minister Frank-Walter Steinmeier will meet with Secretary of State John Kerry today on the sidelines of one of several important American-German joint efforts: negotiations over limiting Iran's nuclear capability.

Steinmeier said Friday that the expulsion of the U.S. intelligence official was an inevitable step once it became clear that the U.S., long revered for championing democracy after the end of Nazi rule, was spying on Germany. "We need and expect a partnership based on trust," he said.

For now, a senior German official said, the spying "overshadows everything we do." To avoid appearing to be kowtowing to the Americans, Merkel needs "something" from Washington, the official said.

In an interview Saturday with German broadcaster ZDF, Merkel accused the U.S. of using outdated Cold War intelligence methods but pledged not to allow the clash over espionage to get in the way of joint projects between the two NATO allies.

Merkel dismissed a suggestion that the country may scrap negotiations for the Transatlantic Trade and Investment Partnership between the European Union and the U.S.

"We have differing perceptions on the work of intelligence services, but other political areas like the free-trade agreement are absolutely in our interest," Merkel said.

"We work very close together with the Americans. I want that to continue," she said. "Germany, of course, profits from this cooperation."

Still, the German leader raised the trans-Atlantic breach of trust amid the two investigations.

"The notion that you always have to ask yourself in close cooperation [is] whether the one sitting across from you could be working for the others -- that's not a basis for trust," Merkel said. "So we obviously have different perceptions, and we have to discuss that intensively."

Information for this article was contributed by Alison Smale, Mark Mazzetti and Victor Homola of The New York Times and Arne Delfs and Patrick Donahue of Bloomberg News.

A Section on 07/13/2014

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