A former head of Germany’s foreign intelligence service has been arrested on suspicion of treason and spying on behalf of an overseas intelligence agency, prosecutors said.

August Hanning, 80, was head of the federal intelligence service (BND) – which operates outside Germany to gather information across the fields of political, economic, and military intelligence – between 1998 and 2005.

He was arrested at his home in Nordwalde near Münster early on Tuesday. His former chief of staff, identified only as Manfred D, was arrested at the same time in Bavaria, on suspicion of “aiding and abetting attempted treason and treasonous espionage”, according to a prosecutor’s statement. Media pictures showed Hanning, dressed in an open-necked white shirt, being taken from his redbrick house to a bullet-proof vehicle by masked officers.

Manfred D, who continued to work for Hanning’s successors at the BND after Hanning’s departure until the present day, is accused of using his role to gain access to classified information which he then handed to Hanning “in exchange for payment”, the prosecutors’ statement continued.

“The current findings suggest that, over the years, Manfred D provided Hanning with approximately 2,000 documents, many of which contained classified information to be used exclusively by the federal intelligence service for internal purposes, particularly for executive intelligence briefings,” the statement said.

Prosecutors believe that Hanning intended to resell the documents as part of a paid consulting role he had built up after leaving the BND, prosecutors added. To what extent and to whom he disseminated them remains part of an ongoing investigation.

He is accused of using the information to “draft an analysis for an officer of a foreign intelligence service”, prosecutors said. It was unclear if this information had reached its intended recipient, they added.

Over several years Hanning is also believed to have passed on potentially sensitive political information, in part based on information passed to him by Manfred D, to a close contact representing a separate foreign intelligence service.

Several properties connected to both men were being searched simultaneously on Tuesday, including in Berlin.

Manfred D is due to appear before judges at the federal court of justice in Karlsruhe later on Tuesday, while Hanning is scheduled to appear on Wednesday.

Suspicions over Hanning’s activities emerged as a result of an investigation into the kidnappings of the children from a prominent Hamburg business family, which is the focus of a major trial in the north German port city.

Investigators were led to Hanning over allegations, which he denies, that he helped Christina Block, the heiress of a steak restaurant dynasty, to organise the violent cross-border seizure in Denmark of her children from her estranged husband who has custody of two of their children. Block denies the charges.

After he left the BND, Hanning worked as a global consultant in the fields of security and business, based on his credentials as former intelligence chief. He is considered to have been well connected with government and business sectors in Russia and China.

Hanning was an officer stationed at the embassy-equivalent organisation for West Germany in communist East Berlin. After his role as president of the BND ended in 2005 he became the highest-ranking official in Germany’s security sector as the head of all security agencies under the federal interior minister Wolfgang Schäuble.