Authorities are now exploring whether members of the agency were supportive of the neo-Nazi extremists or sought to protect them in any way.

WSJ: German Intelligence Chief to Step Down

Germany is tough on political extremists, because of its Nazi past and a struggle with left-wing terrorism in the 1970s, but it is tolerant towards most groups claiming a religious basis, such as Islamic fundamentalists (not Scientologists, though).

ECONOMIST: How other countries do it

For a taste of what might ensue you only need to look at the rising power of extremists such as the neo-Nazi Golden Dawn party.

ECONOMIST: The euro crisis