Germany arrests alleged double agent accused of spying on Berlin's NSA ...

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German authorities have arrested a man identified by media as a German intelligence officer who allegedly passed secrets to the U.S.

German media warned that if the man is found guilty, it would be 'the biggest scandal involving a German-American double agent since the war,' The Daily Telegraph reported.

Federal prosecutors said that a 31-year-old German was arrested on July 2 on suspicion of spying for an unidentified foreign power. Chancellor Angela Merkel's spokesman, Steffen Seibert, called the case 'a serious matter,' declining to elaborate on the prosecutors' statement.

'The Chancellor was also informed of this case yesterday,' Eibert told reporters in Berlin.

He declined to comment on reports by Der Spiegel magazine and the daily Sueddeutsche Zeitung that the man worked for Germany's foreign intelligence service, known by its German acronym BND. The newspapers, which didn't identify their sources, said the man was suspected of passing on information about a German parliamentary inquiry into the National Security Agency and other intelligence agencies in Germany.

Seibert said the inquiry's committee members had also been informed of the arrest. 'I will have to leave the conclusions to you,' he said.

The biggest scandal involving a German-American double agent since the war

The man reportedly worked as a support technician for the BND agency. He also may have worked closely with the president of the intelligence service, Gerhard Schindler, Die Welter reported.

The arrested man was allegedly a double agent for the U.S. for two years. He met U.S. agents at least three times in Austria between 2012 and 2014 and gave them hundreds of secret documents for which he was paid €25,000 (US$34,000), the Bild newspaper reported, citing security officials it didn't identify. The documents were seized on a thumb drive containing 218 stolen files and a laptop at the suspect's home, Bild said.

The emergence of a double agent on top of two German probes into NSA surveillance and espionage threatens to compound a U.S.-German rift following allegations that the NSA spied on citizens and hacked Merkel's mobile phone. The allegations have caused friction between Berlin and Washington since they were first published last year, based on documents leaked by former NSA contractor Edward Snowden.

The surveillance reportedly began as long ago as 2002 when Merkel was still the opposition leader, three years before being elected Chancellor. That monitoring only ended in the weeks before President Barack Obama visited Berlin in June 2013.

Citing leaked U.S. intelligence documents, German media reported that the U.S. also conducted eavesdropping operations on the German government from a listening post at its embassy beside the Brandenburg Gate in Berlin, one of more than 80 such centres worldwide.

'Espionage is something we don't take lightly,' Seibert said at a news briefing in Berlin Friday, adding that the German parliament's intelligence oversight committee has been informed. 'This is a serious matter, that's obvious.'

The German officer was approached several times by U.S. intelligence and at least once passed along information on the NSA committee, the daily Sueddeutsche Zeitung said. He was initially suspected of making contact with Russian spies, but he then told investigators about involvement with American agents, according to the report. Public broadcasters NDR and WDR also reported the story.

According to a report in The Daily telegraph, investigators have not ruled out the possibility the man is working for another foreign intelligence service, and passing BND false information to damage U.S.-German relations.

The Federal Prosecutor's Office didn't respond to two requests for comment.

The NSA inquiry in Germany's lower house of parliament, or Bundestag, heard witness testimony yesterday for the first time since convening in March. Federal prosecutors are pursuing a separate probe into possible hacking of Merkel's phone.

'The suspicion of concrete espionage activity against the parliamentary investigative committee is grave and must be pursued as a serious crime,' Konstantin von Notz, the Green Party lawmaker on the committee, said in a statement.

Roderich Kiesewetter, who sits on the committee for Merkel's Christian Democrats, said he was 'astounded' that the information had been leaked.

'This public spectacle hurts the work of the investigation,' he said in a phone interview.

Martina Renner, a member of the opposition Left Party on the parliamentary panel, said the case indicated that anyone who examined Snowden's revelations in detail was subject to scrutiny by U.S. intelligence agencies.

Her panel heard testimony on Thursday from two former NSA employees, Thomas Drake and William Binney.

'If the media reports [about the case] are confirmed then there can't just be a legal response, there also has to be a political response,' she said.

Seibert said Merkel discussed 'foreign policy matters' in a telephone conversation with President Barack Obama late Thursday. He said the conversation focused on Ukraine but declined to say whether the arrest was discussed.

Officials at the U.S. embassy in Berlin declined to comment. The BND didn't immediately return a call seeking comment.

With files from news3blog.blogspot.com, the National Post