Russia objects to U.S. spy claims

U.S. allegations against a group of people accused of participating in a Russian intelligence program are baseless, the Russian Foreign Ministry said Tuesday.

Ten people — including some purported to be Canadians — were arrested over the weekend in the U.S. for allegedly working on "deep cover" assignments for Russia, the U.S. Department of Justice said Monday.

Christopher Metsos, the 11th accused, was arrested early Tuesday at the Larnaca airport in Cyprus while trying to fly to Budapest, Hungary, police in Cyprus said. Metsos, 54, who says he is a Canadian, was later released on bail.

Russia's Foreign Ministry acknowledged that some of those arrested include Russian citizens but insisted they did nothing to hurt U.S. interests.

"We don't understand the reasons which prompted the U.S. Department of Justice to make a public statement in the spirit of Cold War-era spy stories," it said.

The statement also voiced regret that the arrests came even though U.S. President Barack Obama has moved to "reset" U.S. relations with Russia.

Obama declined to comment Tuesday morning when asked about the allegations, referring all questions to the U.S. Department of Justice.

But Phil Gordon, the State Department's top Russia policy official, told reporters the scandal should be seen in the context of a U.S.-Russia relationship in which the two sides co-operate on some issues and disagree on others.

It will not derail administration efforts to improve relations with Moscow, he said.

Canadian citizenship claims

Along with Metsos, the defendants known as Donald Howard Heathfield and Tracey Lee Ann Foley also say they were born in Canada, while Patricia Mills claims to be a Canadian citizen, court papers filed in the U.S. District Court for the Southern District of New York showed.

The defendant known as Heathfield allegedly used the birth certificate of a Canadian infant — who died the decades ago — to build his identity.

'Canada monitors national security concerns and is vigilant in protecting against any threats.' —Public Safety Minister Vic Toews

"It was a shock to us, but the more we thought about it the more we were concerned about our family name," said David Heathfield, the brother of Donald Howard Graham Heathfield, who died in the 1960s.

It is not clear what documents supported the citizenship claims made by the other accused.

"Canada monitors national security concerns and is vigilant in protecting against any threats," Public Safety Minister Vic Toews's office said Tuesday, adding that the Canada Border Services Agency, Canadian Security Intelligence Service and the RCMP "continue to play a strong role in protecting Canada's borders."

"We are always looking for new ways to strengthen our mutual safety and security. We must continue to remain vigilant," the statement said, referring further queries to CSIS.

CSIS was not immediately available for comment Tuesday.

The Department of Foreign Affairs and International Trade refused to comment, calling the affair "an American investigation."

Multi-year investigation

The arrests were the result of a multi-year, multi-city investigation by the FBI, the U.S. Attorney’s Office for the Southern District of New York and the U.S. Justice Department.

FBI offices in Seattle, Boston, New York City and Washington, D.C., used "a tremendous array of surveillance techniques," including video surveillance of public spaces, interception of point-to-point laptop communication, audio and video surveillance of the suspects in their homes and tracking devices on their vehicles, Paul Joyal, an American security analyst, told CBC News.

They also used a "false flag," or an undercover Russian-speaking FBI agent who posed as a Russian intelligence officer, Joyal said.

"What's amazing to me is that this operation had … been engaged in a good 10 years plus, and that the security, the operational security, was maintained," he said.

The arrests had to be carried out Sunday partly because one of the defendants was scheduled to leave the United States, Justice Department spokesman Dean Boyd said, declining to specify which defendant.

Court documents indicate the FBI believed that defendant Anna Chapman was about to go to Moscow, but it was not clear that her impending departure was the one that triggered the arrests. Chapman posted pictures of herself on social networking sites, including a photo of her at the Statue of Liberty and a seductive shot of her in a lacy baby-blue outfit.

'Like peeling an onion back'

"In espionage cases, it's like peeling an onion back," said Fred Burton, a former special agent with the U.S. State Department. Burton is now a security expert at Stratfor, an intelligence company based in Austin, Texas. "You very rarely get to the origin of what tipped off the FBI to begin with."

The FBI alleges the accused spied for Russia for several years — posing as civilians while trying to infiltrate U.S. policy-making circles and learn about U.S. weapons, diplomatic strategy and politics.

All 11 people face charges of conspiracy to act as unregistered agents of a foreign government without notifying the U.S. government. If convicted, they could face five years in prison.

Most were charged with conspiracy to commit money laundering, which carries a maximum penalty of 20 years in prison.

The arrests came after Russian President Dmitry Medvedev and Obama met at the White House last week.