Fugitive German Defense Official Arrested for Bribery

He was on Germany's 'most wanted' list for the past five years. Suspected of tax fraud and of taking nearly €2 million ($2.4 million) in bribes in connection with the sale of 36 armored vehicles to Saudi Arabia, Holger Pfahls has been on the run from the German government. On Tuesday, police in Paris tracked down the former defense official and apprehended him as he left his apartment.

The state prosecutor's office in the southern German city of Augsburg, where the charges were originally brought, confirmed the 62-year old had been arrested. It is not clear yet when he will be extradicted.

Pfahls, who is accused of accepting bribes during the 1991 Gulf War for helping German industrial giant Thyssen obtain a government arms contract for delivering Fuchs tanks to Saudi Arabia, disappeared in the late 1990s before he could be brought to court.

German Interior Minister Otto Schily welcomed Pfahls' arrest, saying it was "the result of the excellent work of German federal police (BKA)."

"For years, its investigators followed all possible leads. This persevering work has now been rewarded," he said.

High-level political scandal

Pfahls is also widely believed to be involved in the party slush-fund scandal that tainted former Chancellor Helmut Kohl and his conservative Christian Democrats Union. State investigators allege that senior officials in Kohl's government, if not the chancellor himself, authorized the negotiations between Pfahls and Thyssen which were orchestrated by German-Canadian arms dealer Karl-Heinz Schreiber.

In 2002, an Augsburg state court found that two former managers at Thyssen took millions of euros in bribes related to the delivery of the tanks, money they failed to declare to tax authorities. Schreiber, who also took a cut in the deal, was arrested in Toronto in 1999 for tax evasion and is currently appealing extradition to Germany.

Political fugitive

Pfahls himself has evaded arrest for five years. Initially BKA investigators believed he had fled to the Philippines, while the media reported he might be dead. In recent press reports, however, it was reported that Pfahls might be hiding in an upscale Paris neighborhood.

The former deputy minister for defense was close to the late ultra-conservative Bavarian state premier Franz Josef Strauss and headed his state cabinet between 1981 and 1985. Before entering Kohl's administration, Pfahls directed the former West German domestic intelligence agency.