Herbert Reul, interior minister of Germany's most populous region, North Rhine-Westphalia (NRW), said the raids targeted 34 police stations and private homes connected to 11 main suspects.
The police officers are believed to have shared more than 100 neo-Nazi images in WhatsApp groups including swastikas, portraits of Adolf Hitler and a composed image of a refugee in the gas chamber of a concentration camp.
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“This is the worst and most repulsive kind of hate-baiting,” Reul told reporters, adding that he expected the investigation to turn up further chats with offensive content.
The suspects could face charges of incitement to racial hatred. A total of 29 police officers are facing disciplinary proceedings connected to the case and have been suspended pending their outcome.
A spokesman for the federal interior ministry called the reports “highly alarming” and demanded a quick and thorough investigation to determine the extent of any far-right infiltration of the police.
“It casts a negative light on police across Germany in our view and is a slap in the face for officers who demonstrate their great loyalty to the free democratic order every day under the most difficult circumstances,” the spokesman Steve Alter told reporters.
Reul said a probe against one police unit in the town of Mülheim an der Ruhr discovered the chats, which he called “a disgrace for the NRW police force” as a whole.
He said he was appointing an ombudsman to investigate the extent of extremism in the state's police ranks.
“Right-wing extremists and neo-Nazis have absolutely no place in the North Rhine-Westphalia police, our police,” he said, adding that it was up to authorities now to show a “crystal clear political profile” that rejected the far right.
Germany has been embroiled in a series of scandals over right-wing extremism within the ranks of the security services.
In July, prosecutors announced the arrest of a former police officer and his wife who they suspect of having sent threatening emails to politicians and other public figures across Germany.
The anonymous messages were all signed “NSU 2.0”, a reference to the German neo-Nazi cell National Socialist Underground that committed a string of racist murders in the 2000s.
The so-called “NSU 2.0” affair has already claimed the scalp of police chief Udo Münch of the state of Hesse, who resigned after it emerged that police computers were used to search for details about a far-left politician who subsequently received one of the threatening letters.
And in June Germany's defence minister ordered the partial dissolution of the elite KSK commando force over right-wing extremism.