Red mist shrouds death of an anarchist: An ambush hailed by Germany as a coup against terrorism has turned into a scandal, reports Steve Crawshaw in Bonn

THREE-FIFTEEN on a Sunday afternoon in the east German railway-junction town of Bad Kleinen, by Lake Schwerin. In the Billiard Cafe at the station, two men and a woman are finishing lunch. They emerge from the cafe together and head through the station tunnel to catch the train for Lubeck. Then, gunfire.

Forty-four bullets are fired on the staircase to the platform, and on the platform itself. After it is over, one of the three is lying dead on the tracks and another is under arrest. Two of the most wanted terrorists in Germany are out of action as the authorities acclaim an 'important success' in the battle against terrorism.

In fact, the shootout in Bad Kleinen on 27 June was the start of a scandal that has already forced the resignations of the interior minister and the federal prosecutor, and may end with the disbandment of the GSG-9 anti- terrorist unit, Germany's equivalent of the SAS.

The dead man was Wolfgang Grams, 40, wanted as a member of the Red Army Faction terrorist group; the arrested woman was Birgit Hogefeld, 36, his girlfriend, also regarded as a key member of the group, who has been underground since 1984. (The person with them was a police informer). Also dead was Michael Newrzella, 26, a member of the elite GSG-9 unit that carried out the operation. He had cancelled a holiday with his brother to take part in this prestigious operation.

For a day or two, the authorities expressed regrets about the death of Newrzella, but otherwise they seemed content to boast about their catch, dead and alive. Public satisfaction, however, soon gave way to a deep scepticism when it became clear that the officials had given an inaccurate account of what had happened on 27 June.

The first version was that Birgit Hogefeld had fired first. But she did not fire her weapon at all, and it was discovered and confiscated only when she was in the police van. The official account even got the location of the story wrong: the three were said to have eaten in the Waldeck restaurant, but the Waldeck was closed, as it always is on Sundays.

More importantly, serious questions were raised as to how Grams, and even Newrzella, had died. Several accounts suggested that Newrzella might have been killed by 'friendly fire'. (Like his colleagues, he was not wearing the bulletproof vest that would have saved his life; it was later argued that, as it was a warm day, these would have been too conspicuously bulky.)

As for Grams, the authorities came up with a different version almost daily. He was officially said to have committed suicide; not to have committed suicide; or to have shot himself accidentally while trying to escape.

A trusting public initially accepted that Grams had simply died in the shootout. That seemed understandable, and there was little criticism of the GSG-9, which still appeared to be the semi-heroes. That death-in-a- hail-of-bullets version is now, however, the one version nobody seems to believe, officially or unofficially.

Witnesses said Grams, already wounded and out of action, was executed at close range. A woman who worked in the station's newspaper kiosk told German television that she had seen one of the GSG-9 men shoot him 'a few centimetres from his head'. Der Spiegel magazine quoted a witness, who had taken part in the action, as saying it had been a 'real execution'. The man told Der Spiegel: 'A colleague from GSG-9 fired from a distance of a maximum five centimetres.' He described the scene as being 'like in a horror film'.

But investigators continued to insist that they knew nothing about such an execution. Instead, in an official announcement last week, it was emphasised that the lethal weapon had probably been Grams's Ceska 75 pistol, not a Heckler & Koch, used by GSG-9. There were, however, no witnesses to an alleged suicide. Instead, some argued that GSG-9 might have finished Grams off, using his own weapon.

As the inconsistencies grew, so did the embarrassment in high places. There were calls for the resignation of Alexander von Stahl, the federal prosecutor who kept appearing on television with yet another version of what had happened. Even Chancellor Helmut Kohl's office joined in, complaining about the incompetence with which the affair was being handled.

Mr von Stahl tried to cling to power, but the interior minister, Rudolf Seiters - under much less pressure than Mr von Stahl - suddenly resigned, just a week after the killings. The contrast was clear. Some suggested that he was politically unwise to go; in reality, the resignation may have been a good long-term investment. Mr Seiters, who bore no direct responsibility for events, reaped praise for his behaviour (one German newspaper even believed his prompt and honourable departure was 'in the English style'). Many comparisons were made with the string of German politicians who have been forced out of office at political gunpoint in recent months.

Within a few days, even while protesting that his job was safe, Mr von Stahl was sacked. But the chaos continued. Now, the spotlight has swung to the other institution most directly involved, the Bureau of Criminal Investigation, with which the prosecutor's office has been publicly trading insults. The bureau's chief, Hans-Ludwig Zachert, may be the next candidate to be asked to go.

In the meantime, the GSG-9 (the initials stand for Border Protection Group) is under pressure as never before. Created 20 years ago, its members were heroes in 1977 when they stormed a hijacked Lufthansa plane and freed its 80 passengers.

And the Red Army Faction - whose founder members were Andreas Baader and Ulrike Meinhof - may be down, but it is by no means out. Communism has collapsed, but the faction, or RAF, lives on. Times are harder now. The East German regime used to play godfather, allowing West German terrorists to take on new identities in East Germany; but the collapse of the Berlin Wall and the opening up of Stasi files put paid to that.

None the less, the attacks continue. RAF actions in the past few years have included the killing of Alfred Herrhausen, head of the Deutsche Bank, in 1989; the killing in 1991 of Detlev Rohwedder, head of the organisation responsible for selling off state companies in East Germany; and the blowing-up, earlier this year, of a high- security prison near Darmstadt.

As the authorities braced themselves for revenge, 2,000 RAF sympathisers yesterday demonstrated in Grams's home town of Wiesbaden, central Germany. 'We can't force them to tell the truth, only to lie more brazenly,' read one banner.

(Photographs omitted)