BERLIN (Reuters) - Membership in a network of far-right groups that claim allegiance to the pre-war German Reich surged in 2017, Germany’s domestic intelligence service said, fuelling concerns about the threat of extremist violence.

The number of Reichsbuerger - “Reich Citizens” - movement adherents, who say the modern-day Federal Republic of Germany is illegitimate, rose by 65 percent, the agency said in its annual report issued on Tuesday.

While far-right activity remains a fringe phenomenon in Germany, it has been behind high-profile crimes, most recently 10 murders committed by the so-called National Socialist Underground (NSU), whose sole surviving leader was sentenced to life in prison last month.

Brigit Mair, a far-right extremism expert at the Nuremberg Institute for Social Science (ISFBB), said it had taken the killing of a policeman by a “Reichsbuerger” to make authorities take the threat seriously.

Many of the Reichsbuerger, who say they still owe allegiance to Adolf Hitler’s Third Reich defeated in World War Two, have affinities with the violent far-right milieu from which the NSU killers sprung.

The noted rise in numbers is partly due to the increased attention the domestic security service is paying to the far-right in the wake of the NSU killings, the agency said.

The government regards only about five percent of the group as “extremists’ but that was an rise of almost 80 percent from the previous year - from 500 in 2016 to 900 last year.

“There are elements and patterns of argument pointing to anti-Semitic ideology (in these groups),” the Office of the Protection of the Constitution annual report said, adding that the majority of the 16,500 groups’ members were men of over 40.

The groups use the Internet and social media intensively to distribute their views, the report said. “But they develop and actively spread views which are legally completely absurd in the ‘real world’ too.”

The movement issues “fantasy” identification cards, changes registration plates on their cars and asks foreign embassies to recognize their local authority, it added.

A similar rise was also recorded among the “Selbstverwalter” - “self-administrators” - who indulge in similar activities.

“The goal is to create confusion to obstruct or make impossible the work of the government administration,” the report said.

Many Reichsbuerger and Selbstverwalter citizens own guns and around 7 percent have weapons permits, compared to 2 percent of the population overall, the report showed.

“In 2017 around 1,100 members of the Reichsbuerger and Selbstverwalter obtained a gun license, posing a high-risk group within the scene which is drawing the attention of security authorities.”

In October, a court in the Bavarian city of Nuremberg sentenced a Reichsburger member to life in prison for shooting dead a police officer.

Despite the increase in the numbers of identified far-right sympathizers, far-right violent crime dropped 34 percent overall in 2017, the report showed.