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Edition: U.S. Article Comments (10) Video Save Email Print Reprints Most Popular Most Shared China denies military exercise aimed at U.S. 5:53am EDT Iran sees no risk to gasoline imports, official says 6:22am EDT Russia says U.S. spy accusations baseless and improper | Video 10:15am EDT Megan Fox marries in Hawaii: report 3:17am EDT Singer murdered after denying he was dead 11:41am EDT Trapped drunk driver opens another beer as awaits rescue 23 Jun 2010 Russia alarmed by CIA view of Iran's weapons 27 Jun 2010 Wall Street tumbles after drop in consumer confidence 11:10am EDT Analysis: Doing nothing might have been best for oil spill 28 Jun 2010 Sandra Bullock, Jesse James finalize divorce | Video 28 Jun 2010 Trapped drunk driver opens another beer as awaits rescue 23 Jun 2010 Analysis: Doing nothing might have been best for oil spill 28 Jun 2010 China denies military exercise aimed at U.S. 5:53am EDT Elevation Partners buys $120 million in Facebook shares 11:12am EDT Special Report: How some textile mills sidestepped Armageddon 1:58am EDT UAE freezes 41 Iran-linked bank accounts-report 28 Jun 2010 Russia says U.S. spy accusations baseless and improper | Video 10:15am EDT Steve Carell "resigning" from "The Office" next year 28 Jun 2010 U.S. intelligence community debates China's bond holdings 23 Jun 2010 FDA recommends new limits on livestock drugs 28 Jun 2010 Commentary Bernd Debusmann: A comeback for the American melting pot? As early as next year, there could be more babies born to non-whites than whites in America. Some say we're a "demographically blessed nation", but the transformation comes with huge challenges for which there is no solution in sight, writes columnist Bernd Debusmann. Commentary Russia says U.S. spy charges baseless and improper Alexei Anishchuk MOSCOW Tue Jun 29, 2010 11:48am EDT Factboxes Factbox: Use of "illegals" in spying 9:35am EDT Factbox: "Haven't we met?"- U.S. case alleges use of spycraft 9:40am EDT Related News Analysis: Arrests show U.S.-Russia spies' covert war lives on 8:24am EDT Timeline: Previous U.S.-Russia spy incidents 10:15am EDT Cyprus bails suspect in U.S.-Russia spy case 8:21am EDT Russia: U.S. spy allegations baseless, regrets timing 6:29am EDT Irish checking fake passport in US-Russia spy case 8:28am EDT Related Video Russian spies arrested in the US 4:18am EDT U.S. President Barack Obama listens while Russia's President Dmitry Medvedev speaks during a joint news conference in the East Room at the White House in Washington, June 24, 2010. Credit: Reuters/Kevin Lamarque MOSCOW (Reuters) - Russia accused the United States Tuesday of making baseless Cold War-style charges, rejecting Washington's announcement it had cracked a Russian spy ring that had spent years recruiting sources and digging for secrets. U.S. | World | Politics | Russia "Such actions are baseless and have improper aims," the Russian Foreign Ministry said after the arrest of 10 suspected spies in the United States in the biggest espionage scandal for years. An 11th suspect was arrested in Cyprus Tuesday and released on bail, police on the Mediterranean island said. The suspects, some of whom lived quiet lives in American suburbia for years, were accused of gathering information ranging from data on high-penetration nuclear warhead research programs to background on CIA job applicants. The arrests -- days after a warm Washington summit between President Barack Obama and Russian President Dmitry Medvedev -- thrust a Cold War-style spy scandal into the midst of the U.S. leader's "reset" of long-strained ties with the Kremlin. "The choice of timing was particularly graceful," Russian Foreign Minister Sergei Lavrov told journalists sarcastically during a trip to Jerusalem. Other Russian officials also suggested the timing was no coincidence. "We do not understand what prompted the U.S. Justice Department to make a public statement in the spirit of Cold War espionage," the Foreign Ministry said. "We deeply regret that all of this has happened against the background of the relations reset declared by the U.S. administration itself," the ministry said in a statement. With buried banknotes, coded communications and other details, the U.S. allegations echoed superpower spy scandals of the Cold War and the more recent chill in relations with a Kremlin which, under the 2000-2008 presidency of longtime KGB officer Vladimir Putin, routinely accused the West of trying to weaken Russia. Moscow has repeatedly accused Western powers of maintaining spying operations against Russia despite the end of the Cold War. Western powers also complain of Russian activity, especially in the commercial and scientific areas. BLOW TO OBAMA The U.S. Justice Department announced the arrests days after Obama hosted Medvedev. Before their meeting in Washington, Medvedev toured California's Silicon Valley to try to show Russia is building an open, investor-friendly economy. Russian analysts said the timing suggested it was an attempt to undermine the "reset" which Obama's administration has hailed as a major foreign policy achievement, citing Moscow's support for sanctions against Iran and cooperation on Afghanistan. "It's a slap in the face to Barack Obama," said Anatoly Tsyganok, a political analyst at Moscow's Institute of Political and Military Analysis. He predicted Russia would follow Cold War etiquette and uncover an equal number of alleged U.S. spies. But military analyst Alexander Golts said the scandal would be unlikely to deal a major setback to relations. He said Obama's administration would be eager to "soft-pedal the situation" to avoid damage to improved ties it sees as a foreign policy success, pointing to Kremlin support for new sanctions against Iran and cooperation on Afghanistan. Tatyana Stanovaya, political analyst at Moscow's Center for Political Technologies, said the allegations could widen a rift in Russia's elite between advocates and opponents of better U.S. ties, with the scale of the response hinting at who is ascendant. Stanovaya said it could dent the authority of Medvedev, who is struggling to emerge from the shadow of Putin, his powerful prime minister, and has made engagement with Washington a hallmark of his presidency. Putin's spokesman told Reuters he had no comment on the spying allegations and said they were unlikely to be discussed during Putin's meeting Tuesday with former U.S. President Bill Clinton in Moscow. The chief spokesman for the SVR foreign intelligence service, Sergei Ivanov, said: "There will be no comment." The U.S. Justice Department accused the 11 people charged of operating under orders of the SVR as "illegals"; the term applied in the intelligence world to agents infiltrated to live and operate under false identities, rather than officers who use diplomatic or other legitimate cover. They were accused of collecting information ranging from research programs on small-yield, high-penetration nuclear warheads to the global gold market, and seeking background on people who applied for jobs at the Central Intelligence Agency (CIA), according to criminal complaints filed in a U.S. court. Authorities said 10 of them were arrested Sunday in Boston, New York, New Jersey and Virginia on charges including conspiracy to act as unlawful agents of the Russian Federation and money laundering. The goal of the alleged spies was to "become sufficiently 'Americanized' such that they could gather information about the United States for Russia and can successfully recruit sources who are in, or are able to infiltrate, United States policy-making circles," according to court papers. One alleged spy was accused of sending back information about leadership changes at the CIA. The U.S. Justice Department said they received extensive training in coded communications, how to evade detection and how to pass messages to other agents while casually brushing past them in public places. After the 2001 arrest of FBI agent Robert Hanssen, accused of selling secrets to Moscow over 15 years and sentenced to life in prison, Washington expelled four Russian diplomats and ordered 46 to leave the country. Russia responded in kind. In 2006, Russia accused British diplomats of running a James Bond-style spy ring and communicating with agents via an electronic device disguised as a rock. The next year, British officials said Russian spying was "at Cold War levels." (Additional reporting by Dmitry Zhdannikov and Amie Ferris-Rotman; Writing by Conor Humphries and Steve Gutterman; Editing by Mark Trevelyan) U.S. World Politics Russia Comments See All Comments (10) | Post Comment Jun 29, 2010 2:22am EDT Russians are cleverer…a new U.S. story to show they can discover things..but not the 9/11 plotters….. FuadMuhammad Report As Abusive Jun 29, 2010 2:34am EDT bahhh, there just pissed off that they cant hack windows7, so there here to find a good set of cd keys too take home to mother russia lol 3mul8 Report As Abusive Jun 29, 2010 3:53am EDT Message to Russia: you don’t have to spy on us, just ask BO, I’m sure he will provide you with all the classified information you require. dalidog Report As Abusive Jun 29, 2010 6:47am EDT what are they seeking to discover? how to destroy a country from the inside seems the main lesson we can teach the world right now. klh Report As Abusive Jun 29, 2010 6:54am EDT 30 years ago this would have been big news but not today. The Cold War is long over STORYBURNcool Report As Abusive Jun 29, 2010 7:11am EDT The Russians are probably here to research how the American Education System has failed to instill the use of proper grammar in its constituents. I could be wrong but judging from earlier comments–it’s not a long shot. onewildflower Report As Abusive Jun 29, 2010 9:03am EDT FBI puppet masters at work! Guess why? mooses Report As Abusive Jun 29, 2010 9:57am EDT We do need more enemy phantoms. Otherwise, we might look to see what we’re doing to ourselves. And American voters couldn’t handle that kind of accountability. andrewhorning Report As Abusive Jun 29, 2010 10:47am EDT onewildflower – Don’t forget our failure to teach critical thinking. (xkcd.com/202/) STORYBURNcool: That’s right. The war’s over and we’re buddies now, just like that. They wanted that information so they could have a more intimate friendship with us. 5tudentT Report As Abusive See All Comments (10) Add a Comment *We welcome comments that advance the story directly or with relevant tangential information. We try to block comments that use offensive language or appear to be spam and review comments frequently to ensure they meet our standards. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. © Copyright 2010 Thomson Reuters Editorial Editions: Africa Arabic Argentina Brazil Canada China France Germany India Italy Japan Latin America Mexico Russia Spain United Kingdom United States Reuters Contact Us Advertise With Us Help Journalism Handbook Archive Site Index Video Index Reader Feedback Analyst Research Mobile Newsletters RSS Podcasts Widgets Your View Labs Thomson Reuters Copyright Disclaimer Privacy Professional Products Professional Products Support Financial Products About Thomson Reuters Careers Online Products Acquisitions Monthly Buyouts Venture Capital Journal International Financing Review Project Finance International PEhub.com PE Week FindLaw Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests. NYSE and AMEX quotes delayed by at least 20 minutes. Nasdaq delayed by at least 15 minutes. For a complete list of exchanges and delays, please click here.

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