The unidentified soldier was detained when he went to retrieve a loaded pistol he had hidden in a bathroom at Vienna International Airport.
The public prosecutor’s office in Frankfurt said the 28-year-old is suspected of planning a serious “state-threatening act of violence”, fraud and violating firearms laws.
More than 90 German police officers have worked alongside Austrian and French security forces to search 16 locations across three countries on Wednesday, when a suspected accomplice was arrested in Bavaria.
Investigations have revealed that the Bundeswehr lieutenant was stationed at Illkirch-Graffenstaden in France before registering as a refugee back in Germany.
He gave false information to authorities in Giessen, Hesse, on 30 December 2015 – as Germany was overwhelmed by the arrival of almost a million asylum seekers.
Posing as a Syrian refugee but reportedly speaking in French, rather than Arabic, the man submitted an asylum application at Zirndorf in Bavaria in January last year.
“As a result, he was given shelter in a refugee home and has received monthly financial benefits under this false identity,” the Frankfurt prosecutor’s office said.
“These findings, as well as other evidence, point towards a xenophobic motive for the soldier’s suspected plan to commit an attack using a weapon deposited at Vienna airport.”
If his plan had succeeded, his fingerprints would have registered on the refugee records system and led investigators to his false identity as a Syrian asylum seeker, turning fresh scrutiny on migrants in Germany.
Isis has previously used a similar ploy, giving its militants fake Syrian passports that were found at the scene of the Paris attacks.
The man’s suspected accomplice, a 24-year-old student, was arrested in Hammelburg for alleged involvement in the plot.
Police have searched the homes of the two suspects as well as their friends and workplaces, with detectives seizing “extensive material” including mobile phones, laptops and documents.
Prosecutors said the soldier had no permission for the 7.65mm pistol stashed in Vienna, while illegal weapons were also found at his accomplice’s house.
Both men remain in custody in Frankfurt as the probe continues.
The soldier was arrested days after prosecutors revealed that the man who orchestrated the Dortmund bus bombings had attempted to frame Isis to make money on shares.
Sergej W, a dual German-Russian national, detonated three bombs targeting a bus carrying the Borussia Dortmund football team, seriously injuring one player on 11 April.
He left misspelled letters at the scene claiming the attack was retaliation for German military intervention against Isis, but investigations found he was not an Islamist but a trader planning to profit from short-selling shares.
A series of Isis-inspired terror attacks and plots in Germany have raised tensions leading into September’s federal elections, where Angela Merkel is battling to win a fourth term as Chancellor.
Right-wing groups have blamed her decision to open borders to refugees in 2015, while extremists have launched hundreds of attacks on asylum seekers’ accommodation.
Division over asylum, immigration and security has driven clashes at protests and political rallies, driving a record year for politically-motivated crime in Germany.
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