Monday, July 6, 2009

Germany's Biggest Bank Admits Hiring Detectives to Spying on Staff

Via -

Germany's biggest bank, Deutsche Bank, admitted Monday it had spied on a former member of its supervisory board, suspected of disclosing 2001 third quarter results before their official publication.

A bank spokesman said the target was Gerald Herrmann, who represented the union Verdi on the board that year.

German magazine Der Spiegel had reported over the weekend that the bank hired detectives to spy on its employees including a member of its supervisory board, managers and a shareholder.

The bank launched an internal inquiry at the end of May into potential breaches of data privacy law in connection with the affair, Spiegel said.

The spokesman confirmed the investigation and said the financial market regulator Bafin had also been contacted.

Herrmann told the Handelsblatt business newspaper on Monday Deutsche Bank informed him of the case a couple of days ago.

He denied the allegations against him and said he suspected he was spied on because Deutsche Bank did not appreciate his criticism of a redundancy compensation scheme.

The bank apologised to Hermann but the union member said he wanted a personal apology from chief executive Josef Ackermann who promised a "zero tolerance" approach over the affair at an annual general meeting of the bank.

According to Der Spiegel detectives "kept an eye on the movements of these people, and made inquiries as to who they were meeting and when".

In 2006, managers were spied on because of their suspected links to media mogul Leo Kirch, who was involved in a legal battle with Deutsche Bank, the magazine said.

Spiegel also said minority shareholder Michael Bohndorf, a lawyer living in Ibiza, Spain, was spied on.

Several detective agencies may have been involved in the affair.

Among the agencies is one led by a former agent of the Stasi, the notorious secret police in the former East Germany, who was also implicated in a scandal at German phone giant Deutsche Telekom.

Deutsche Bank even used "female bait" to find "personal weaknesses of certain shareholders", the magazine added.

Scandals over violations of privacy law have rocked the German corporate world in recent months, notably at railway company Deutsche Bahn and Deutsche Telekom.

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