There are reports that the IRS as well as tax authorities in other countries including Canada, Germany, Australia, Italy, Sweden, Spain, the United Kingdom, and New Zealand have purchased stolen information detailing confidential bank accounts in Liechtenstein. Liechtenstein has very strict banking privacy laws, and it is seen by all the above countries as a safe haven for tax evaders. The country, which is a tiny principality next to Switzerland, is one of three countries (Andorra and Monaco being the other two) listed by the Organization for Economic Cooperation and Development as being "uncooperative tax havens."

How did the countries get this information? In one news report, it was said that, "Heinrich Kieber, a 42-year-old computer expert, offered the information for sale to several countries, including Germany, which paid about $6.3-million for it. (Mr. Kieber is said to be hiding in Australia under a new identity.)"

The U.K. and Germany have admitted paying for the banking information, and it appears that it was the German intelligence services who first paid Kieber for the information, and then helped spirit him to Australia to live a life of luxury under his new identity.

I wonder if Kieber has to pay tax to Australia for his earnings, or were his earnings tax free?

Liechtenstein has protested vigorously about this tactic of foreign government sponsored data theft, but it has so far been powerless to do much about it. Liechtenstein could see its economy take a very big hit from this action, which the offending countries view as legitimate and legal, but which I think one could just as easily interpret as another form of government-supported cyber warfare.

Interestingly, the U.K. takes the position that it has done nothing wrong. In a London Times article, it states that, "The Taxes Management Act, 1970, originally stated that a court hearing a tax evasion case could consider evidence obtained 'by any lawful means'. However, in 2004, the word 'lawful' was dropped from the legislation." This means the U.K. government doesn't care how tax information is gained - if it gets it, it will use it.

Even given this, if I were Liechtenstein, I might be very tempted to implement a "tit for tat" retaliation strategy; for example, offer money to informants, hackers, etc., in those offending countries for financially or personally sensitive information on say their country's politicians to then sell to the highest bidder in the press.

The targeted countries could hardly be in any moral position to protest: They have in essence legitimized data theft.

Only the Danes seem to see the problem. Danish tax minister, Kristian Jensen,described the affair as an "advanced form of handling stolen goods."

He went on to say, "I think it's a moral problem to reward a criminal for some information that he stole. I don't like this and I don't think this ethic is the best way to ensure that taxes are paid correctly."

Watch for the unintended consequences of this action in the future.