Russia Arrests Two Men in British Council Spying Row

Diplomatic tensions between Britain and Russia flared again this afternoon when Moscow arrested a Russian national with links to the British Council, accusing him of industrial espionage along with his brother.

The Federal Security Service (FSB) ? Russia's successor to the KGB ? said Alexander Zaslavsky, the president of the council's alumni club, had been involved in "illegal" spying.

The claim follows a raid by armed police yesterday on the Moscow offices of the oil giant BP and its local joint venture, TNK-BP. The FSB said Zaslavsky's brother Ilyia, a TNK-BP employee, had also collected "classified information" for foreign companies.

In January the Kremlin closed the British Council's regional offices in St Petersburg and Yekaterinburg. The long-running diplomatic row stems from Russia's refusal to extradite Andrei Lugovoi, the former FSB agent charged with the murder of Alexander Litvinenko.

The alumni club is made up of Russians who have studied in the United Kingdom, mostly at Oxford, Cambridge, Edinburgh and Warwick universities, since the mid-90s. In February, Zaslavsky and 150 other club members wrote a letter of protest to the Russian president, Vladimir Putin, urging him to reverse the closure of British cultural offices across the country.

Russia's actions had injured the "image of Russia" and represented "a blow to the interests of millions of Russians", the letter said. Today, the British Council in London said it was "concerned" by Zaslavsky's arrest, which follows the intimidation in January by the FSB of Russian staff at the British Council. "The club is made up of people we have a good relationship and good contacts with," the council said.

Both brothers were US citizens, Russia's Interfax news agency reported. The raid on TNK-BP appears part of attempts by the Kremlin to tighten its control of the country's strategic energy resources and freeze out foreign companies.

TNK-BP, a joint venture of BP and Russian shareholders, is under increasing pressure to sell its assets to Russia's state gas monopoly, Gazprom. It has adopted a public strategy of trying to ingratiate itself with the Kremlin, but this appears to have failed.

On Wednesday, FSB and interior ministry officials stopped TNK-BP employees from entering or leaving the company's headquarters in central Moscow. The officials then raided the separate downtown office of BP.

Today, the FSB said it had found proof that the brothers had been "illegally collecting classified commercial information for a number of foreign hydrocarbon companies, which wished to have advantages over their Russian rivals". FSB investigators had also discovered the "business cards" of representatives of the CIA and "foreign defence departments", it said.

TNK-BP had no immediate comment on the allegations. The brothers had been released on bail, agencies reported. The British embassy in Moscow said it was closely monitoring developments.

The FSB has previously accused the British Council of being a "nest of spies", despite only four British nationals actually working for the organization.

The Foreign Office confirmed one arrest had been made in Moscow but said the individual was not a member of the British Council or a British national. Downing Street was said to be in contact with the British Council over the arrests.