Eight years' prison for arms dealer

Karlheinz Schreiber, 76, who holds dual Canadian and German citizenship, was found guilty of withholding more than 7.5 million euros.

A German court Wednesday sentenced a Canadian-German arms dealer, who was a key player in a party funding scandal that helped propel Chancellor Angela Merkel to power, to eight years in prison.

Karlheinz Schreiber, 76, who holds dual Canadian and German citizenship, was found guilty of withholding more than 7.5 million euros (9.7 billion dollars) in taxes between 1988 and 1993 by a court in the southern city of Augsburg.

The presiding judge said that Schreiber's statements during the trial were "not credible."

- It was noticeable that the accused sought refuge in red herrings and was consistently silent on the really decisive questions - he said.

Prosecutors had called for a nine-and-a-half-year jail term on charges of tax evasion and obtaining illegal advantage but he was acquitted on the latter charge.

Schreiber played a central role in a sprawling slush-fund affair that rocked the Christian Democratic Union (CDU) party in the 1990s and tarnished the legacy of former chancellor Helmut Kohl.

At the height of the scandal, Merkel wrote an editorial in the Frankfurter Allgemeine Zeitung daily in 1999 calling for Kohl to come clean over the funding scandal and for the party to break with its murky past.

Merkel's willingness to challenge her former mentor during the scandal rapidly inflated her meagre profile and she was elected head of the CDU the following year.

The verdict risked bringing back bitter memories for the party only four days before a key regional election that could cost Merkel's coalition its majority in the Bundesrat, Germany's upper house of parliament.

A new poll by Forsa published Wednesday showed support for Merkel's conservatives slipping two points to 34 percent.

Her partners, the Free Democrats, were stuck on just eight percent.