Deception

³ Deadly Games and Useful Idiots

Many reading this grim account may still feel that greedy, lawless and incompetent spooks are chiefly a problem for Russians. It may all be a great pity, but why should outsiders actually mind what happens inside the Kremlin’s realms? But as I will show in this chapter, the toxic combination of chauvinism and criminality is a problem for the rest of the world too. In no other country have gangsterdom and state power overlapped to such a threatening extent. The most powerful drug cartels may have high-tech communications equipment or the ability to penetrate a law-enforcement agency, or have some politicians on the payroll. But they have nothing that (yet) matches Russia’s ruling criminal syndicate’s capabilities. It has almost limitless money, global geographical scope and the full armoury of state technical and logistical resources, from spy satellites to submarines, giving unprecedented capabilities in snooping and manipulation. Russia’s world-class hackers, for example, work sometimes in government, sometimes under official protection and sometimes entirely in their own criminal interest.¹ Russian dirty money and underhand business practices taint and corrode the financial systems, business cultures and politics of the countries they touch. As Don Jensen, a stalwart American critic of the regime, points out, Russia’s main export is not oil and gas. It is corruption.²

Though officials do not speak about this much in public, they worry a lot about it in private. A cable from the American embassy in Madrid in August 2010 (now available on WikiLeaks) termed Russia a ‘virtual mafia state’.³ It stated baldly that Russian intelligence agencies were using mafia bosses to carry out criminal operations such as arms trafficking. It highlighted the secret support and protection that Russian intelligence in Spain provides for gangsters, who in return work ‘as a complement to state structures’ to carry out tasks that the Russian government could not be publicly linked to. The cable cited gun-running to Kurdish separatists in Turkey and also the mysterious case of the Arctic Sea cargo ship, hijacked in 2009 in a complex tale that probably involved smuggling elements of Russia’s S-300 air defence system to Iran.⁴

The source of the allegations was José Grinda González, nicknamed ‘Pepe’, a senior Spanish prosecutor who has spent a decade investigating the Russian mafia. His record in fighting Russian organised crime leaves other European countries looking feeble and ineffective. He was responsible for the investigation of Zakhar Kalashov, the most senior ‘Russian mafia’ figure (he has Georgian nationality) to be jailed in Europe. Mr González was involved in two big anti-mafia operations in recent years, ‘Avispa’ (2005–07) and ‘Troika’ (2008–09), which resulted in the arrest of more than sixty suspects.

In January 2010 Mr González gave a frank briefing to a US–Spanish working group. He not only described Russia and Belarus as ‘mafia states’ where ‘one cannot differentiate between the activities of the government and OC [organised crime] groups.’[19] He also endorsed the sensational claims made by Aleksandr Litvinenko, a Russian political exile poisoned by a polonium isotope in London in 2009. (Mr Litvinenko, a former FSB officer, claimed in two books, both banned in Russia, that the former KGB was involved in assassinations and drug smuggling, and staged terrorist outrages for political purposes.)

Among other insights, Mr González said the Liberal Democratic Party of Russia was created by the intelligence services and was closely tied to the mafia (run by the clownish Vladimir Zhirinovsky, it adopts extreme political positions but its deputies in the Duma dependably vote the Kremlin line). The FSB, he said, had the upper hand in the state’s symbiotic relationship with criminality. Crime bosses who do not toe the line risk being killed or jailed. Perhaps most worryingly of all, he appeared pessimistic about the Spanish state’s ability to deal with the Russian mafia. Attempts to ‘decapitate it’ had failed, he said. And its senior bosses were fighting back, with a ‘systematic campaign’ to manipulate the Spanish legal system.

Mr González’s views are striking, but they are not extreme. Other officials say much the same thing in unattributable briefings. What is unusual is that, thanks to WikiLeaks, the wider public is able to read the unvarnished and attributable views of a senior, expert official, speaking frankly. Occasional on-the-record assessments from senior security officials say much the same thing in more guarded language.⁵ The really puzzling thing is why this does not resonate into the public debate. Faced with a gangster-run state on our doorstep, why do not our politicians take the necessary steps to quarantine it and counter its malign effects? One reason is clearly the ‘war on terror’, which has diverted attention and effort to deal with the threat from radical Islam. Even in the narrow world of counter-intelligence, Chinese spies seem to attract more attention than Russian ones. Admittedly, Beijing’s agencies have formidable hackers and are good at stealing military and technological secrets. But they do not murder people, rig our decision-making, or disrupt our alliances. Russia’s spies are part of a much wider picture: an effort to play divide and rule, to exploit the greed of Western politicians and officials by paying them to make Kremlin-friendly decisions, and to deal ruthlessly with dissent abroad. This last element leads to flagrant law-breaking by Russian spies, which brings surprisingly little comeback.

One example is the Litvinenko case, mentioned above. His killing, in the view of British officials, involved the FSB. I dealt with this at length in The New Cold War.⁶ A second instance is portrayed in a book by two British investigative journalists, Mark Hollingsworth and Stewart Lansley, dealing with what looks like the assassination of Stephen Curtis, a 45-year-old lawyer for Mr Khodorkovsky.⁷ Mr Curtis had helped mastermind the shift of Yukos from a shambolic collection of assets marked by rows with investors into a $15bn oil and gas company. Some called that evolution merely cosmetic; others believed it signalled the end of robber-baron tactics and the adoption of good management and transparent corporate governance. Mr Curtis was also a legal adviser to Mr Berezovsky and to other senior Russian figures.

Mr Curtis dealt with frightening people. But he was not easily frightened. When a friend warned him, ‘You are dealing with the Devil,’ he replied: ‘I will jump on their backs and ride all the way down to hell.’ That proved unpleasantly prescient. After Mr Khodorkovsky was arrested in 2003, Mr Curtis was – all but literally – in the firing line, as the man who knew the intimate details of his finances. He feared prosecution in Russia on the same trumped-up charges – tax avoidance, money-laundering and embezzlement – and a contract killing at the behest of Mr Khodorkovsky’s emboldened business rivals. In the weeks before his death he was under surveillance from investigators hired by minority shareholders in Yukos and by people apparently working for the Russian state. His security consultants found evidence of bugging at his castle in Dorset. He hired a bodyguard and in mid February 2004, worried by escalating death threats, offered (friends say) the British authorities information in return for government protection. A week before his death he told a friend: ‘If anything happens to me in the next few weeks, it will not be an accident.’ On 3 March 2004 his helicopter was approaching an airfield in Dorset in poor but not dangerous weather when it suddenly lost power and crashed into a field. An official investigation said that the pilot, Max Radford, had become disorientated during the final stages of his approach to the airfield and found no evidence of an explosion (though tampering with the controls would have also brought the aircraft down).⁸ Mr Curtis’s former bodyguard Nigel Brown, a former Scotland Yard detective, believes his client was killed and is puzzled that the police did not launch a murder inquiry.

It is not just lawyers for fugitive oligarchs who have reason to be worried. A remarkable BBC radio programme in the summer of 2010 entitled ‘Why Russia Spies’⁹ gave a tantalising glimpse into the closely guarded world of British security and defence worries. It was perhaps a sign of private concern in Whitehall about Russian activities that the radio producers were allowed the access that made the programme possible. Its opening sequence sounded like a flashback to the Battle of Britain: listeners heard fighter pilots scrambling to intercept potentially hostile aircraft. These Russian antics mostly involve the lumbering ‘Bear’ (Tupolev Tu-95) bomber, a propeller-driven hulk that first went into service in 1952. It is a useful platform for launching nuclear missiles, but it is easily spotted and no match for any NATO air force. Sometimes, however, the Russian sorties involve the ‘Blackjack’ (Tupolev Tu-160), a sleek supersonic machine with advanced radar-dodging technology that still creates headaches for NATO. In 2008 news leaked of an incident the previous year when a Blackjack approached northern England at a speed and height that mimicked a real nuclear attack. The target was somewhere between Leeds and Hull. Though the Russian plane turned back just before actually entering British airspace, for a few nerve-wracking seconds defence commanders wondered if World War Three might just possibly be imminent.¹⁰

The real damage was to British credibility, not nerves: the overstretched RAF was short of planes to meet the potential intruder. (That was in 2007: its ability to defend British airspace was weaker at the time of writing and is set to be eroded still further by defence cuts.) The frequency of such probes is surprising – as often as one a week in some periods, and more than fifty since 2005. It is not just Britain that suffers these unwelcome attentions. In 2011, Russian bombers intruded on Dutch airspace on at least three occasions.¹¹ Though irked and sometimes alarmed, defence chiefs dislike discussing the subject. They say that in a real war few Russian planes would get airborne and all would be shot down long before they were near NATO air space. In peacetime, they do not want to give Russia the satisfaction of knowing that its sabre-rattling has an effect.

As well as showing off and tying up scarce defence resources with military stunts, Russian efforts also involve spying on Britain’s nuclear deterrent. It is fashionable to deride this as a Cold War legacy. Those who want Britain to give it up should perhaps ask themselves why Russia spends so much energy trying to unpick its secrets. It is still quite possible to imagine a scenario in which America is unwilling to risk a nuclear confrontation with Russia over a security conflict in Europe. In the autumn of 2009, for example, Russia and Belarus conducted the Ladoga and Zapad-09 manoeuvres.¹² This was in fact one exercise, but divided into two in order to avoid having, to invite observers from NATO, as stipulated by arms-control treaties for drills involving more than 13,000 soldiers. The real exercise was not defensive, but aggressive. The combined forces, some 20,000 strong, were rehearsing how to isolate the Baltic states from the rest of Europe, invade and occupy them. In case of reinforcement by other NATO countries, the rehearsal showed that Russia would respond by using tactical nuclear weapons. This drill was followed by another exercise by Russia’s Strategic Rocket Forces (the custodians of its main nuclear arsenal) in which the target was Warsaw,¹³ showing how closely Russia’s conventional defence planning is linked to the use of nuclear weapons – and how important the British nuclear deterrent remains. Imagine for example that America, facing a defence budget shrivelled by economic weakness, were preoccupied elsewhere, say in a confrontation with Iran that blocked oil supplies through the straits of Hormuz (which could easily be manufactured by Russia) or with China over Taiwan. A reminder from Britain that it has an independent nuclear deterrent and is prepared to use it in response to a Russian nuclear attack on any British forces in the Baltic could tip the balance between peace (meaning victory) and a conflict (which NATO, without America, would lose). Such a scenario is in current conditions extremely unlikely. But if that British response becomes impossible (for example because our deterrent is no longer credible) then the whole basis of Western defence weakens. If a future Russian leadership could assume it did not risk the ultimate penalty for military adventurism (and especially if NATO knew it too), then bullying neighbours, with the threat of armed force at least in the background, becomes more likely.

It is therefore interesting that Akula-class submarines, the pride of Russia’s dwindling navy, have resumed a Cold War-era tactic, lurking off the Forth of Clyde in the hope of picking up the acoustic signature of Britain’s Trident submarines as they enter and leave their base. This distinctive pattern of noise allows sophisticated detection equipment to track and potentially destroy the other side’s submarines. Once you know what you are looking for, it is much easier to find it. The Royal Navy’s Vanguard-class submarines now devote considerable time to fending off these attempts. Given the secrecy that traditionally surrounds anything to do with submarines, any public mention of such concerns is a sign of how seriously naval chiefs take the Russian activities. Whispers in the shadows of Whitehall suggest a still greater incidence of such activities, including the targeting of undersea anti-surveillance installations. Akula-class submarines are also patrolling far afield – even to the coasts of the United States, where one such vessel surfaced as if openly inviting attention.¹⁴ Russia’s aim is to intimidate and divide NATO, forcing the alliance to focus on hard questions that its members would rather avoid, and for which the various national publics have no appetite. If, after stirring up a divisive discussion in NATO, Russia concluded that Poland and the Baltic states were diplomatically and militarily isolated, it then would find it easier to bully them over other matters of concern such as energy supplies, trade or domestic politics. In assessing that scope for manoeuvre, intelligence plays a vital role.

Russia was most interested in the Western reaction to its exercises. What conclusions did military attachés draw? Could NATO tap Russian battlefield communications in real time? Most importantly, how did other countries respond to the quiet but sharply expressed concern from Tallinn, Riga, Vilnius and Warsaw? Was the West’s reaction to tell these frontline countries to calm down and be quiet? Or was it to offer them reassurance? In fact, the reaction was not what Russia expected. Though some officials tried hard to play down the significance of the exercises (one called them ‘a twitch of the dinosaur’s tail’), America ordered a response that included in 2010 a major special-forces exercise, a marine amphibious landing in Estonia and a reinforcement drill in Latvia, with more to follow. NATO warplanes held a large air exercise involving mid-air refuelling. America’s National Geospatial-Intelligence Agency (formerly the Defense Mapping Agency) has compiled a detailed 3D electronic map of the Baltics. NATO contingency plans now for the first time include the Baltic states, involving the use of Swedish airspace and Polish troops. This was presumably not what the Russians wanted. So why did they do it? The chief reason for this self-defeating gambit was a flawed assumption: that the West does not really care about the Baltic states and brought them into NATO only for political reasons. In fact, America at least has shown that it does care about its new allies and is willing to make efforts to prove it.

Monitoring all this closely was the spy-infested Russian mission to NATO. This quasi-diplomatic outfit enjoys a remarkably privileged status at alliance headquarters in Brussels, with regular briefings, spacious offices and security badges that allow its members preferential access to meetings, documents and other facilities. This friendly treatment dates from the days when NATO tried to soft-soap Russia about the alliance’s expansion to the former Soviet empire. By opening up to Russia, NATO hoped to dispel any fears about its intentions; belief persists among some member countries that differences with Russia are merely the result of misunderstandings, and that confrontation would be a sign of failure. This approach is heartfelt, particularly in Germany, where it is an article of faith among senior officials that Russia must be embraced and reassured, not deterred. The theoretical argument about whether relations would be even worse without this approach is unresolvable. What is clear is that attempts to build trust have proved unsuccessful in practical terms. On issues such as terrorism NATO puts cards on the table, and receives in return Russian offerings dressed up as serious intelligence, though in truth they are little more than could be found out on the internet. The Russian spies posted to the NATO mission are numerous, ubiquitous, unscrupulous and energetic. They bluntly and repeatedly approach officials whom they regard as promising targets. They are adept at keeping their distinctive ID badges concealed and slipping into meetings to which they have not been invited. Their chief targets are the alliance’s future military thinking, especially its contingency plans; new capabilities, for example in cyber-warfare or missile defence; and NATO’s codes and communications – the alliance’s central nervous system. They have a sharp eye on counter-intelligence: trying to find out what NATO members know about Russia, and where it comes from. They like to have a clear idea of who is being trained for what, by whom, where, and how well.

A paradox here, as so often in intelligence work, is that many of these secrets are both closely guarded and yet not very interesting. NATO’s abilities and capabilities have shrivelled since the end of the Cold War. Many of its members spend risibly little on defence. Many of the member states’ governments have little interest in Russia, and find it hard to share the worries of countries such as the Baltic states and Poland. In a crisis, NATO’s effectiveness depends almost wholly on the United States. Russian intelligence penetration of NATO probably peaked at a time when it revealed a lack of secrets, rather than their existence. Russia’s lavishly resourced spies do not mind about that. For a start, NATO HQ is a good place to recruit highfliers from the countries that matter – chiefly America, Britain, France, the Netherlands, Norway or Turkey – who will go on to careers in their national defence and security establishments. Secondly, Brussels is a great place for agent-running. Belgian counter-intelligence is weak. Only a handful of officers deal with Russia. They have no powers of arrest and face grave difficulties in obtaining warrants. All this is a serious problem for the hard-pressed NATO Office of Security.

A deeper reason for Russian behaviour is a paranoid mind-set conditioned partly by the Cold War, partly by the alliance’s expansion, and partly by the NATO-led bombing of Serbia in 1999.[20] With the Soviet Union out of the way, Russians believe, America and its allies turned a neutral front yard into a cordon sanitaire, deliberately designed to humiliate and constrain the former superpower, and breaking a promise made to the Soviet Union in exchange for German reunification.¹⁵ What if NATO decides next to help one of Russia’s near neighbours, say Georgia, or Ukraine, or Moldova, in some military flare-up? When dealing with a powerful and unpredictable military alliance on your borders it is better to have too many sources than too few. Nobody is going to complain about having too much information about NATO’s inner workings. The more the diligent spies report that NATO is ineffective and distracted, the more the instructions come back to dig deeper and find the real story.

Other international organisations are at even greater risk. The mental barriers to giving away secrets are lower (betraying your country or its military alliances is one thing, betraying an anonymous bureaucracy is another). Whereas NATO at least tries to keep spies at bay, the headquarters of the European Commission and European Council in Brussels are a security nightmare: a warren of badly policed offices and unvetted staff, where outsiders can walk in and out almost at will on the flimsiest of pretexts. The European Parliament, newly important since the Lisbon Treaty carve-up gave it and the EU’s big countries the main role in the union’s decision-making, is a particularly vulnerable target. Its members (and office staff, on their behalf) can demand almost any document they like from the European Commission. Staffers are lightly vetted (or not at all) and can ask for a briefing or an informal chat with any official.

The EU, it should be noted, is not in the position to treat Russia the same way. For a start, it has no intelligence-gathering service of its own. Weak leadership, squabbles and bureaucracy plague its misnamed ‘External Action Service’, which is supposed to spearhead a more decisive and better-informed EU diplomacy. An intelligence agency requires much greater grip and focus than a diplomatic service. If the EU cannot yet run a foreign ministry and embassies properly, it has no chance of developing a spy agency capable of dealing with a tough target such as Russia. The only advantage of this is that a bad intelligence agency is more damaging than none at all. If you don’t spy, you can’t bungle; you can’t be fooled by bad sources or get good ones into trouble. The disadvantage is that politicians may lack full knowledge of the people and thinking that they are dealing with. The EU is also unable to get proper intelligence from its member states. For the handful of member countries (chiefly Britain and France) that do have real intelligence services, the job is mostly outwitting the EU on matters of national interest, not helping the Eurocrats to raise their game. Even when European and national interests do overlap, the EU is seen as too leaky to be trusted with more than the stalest crumbs of intelligence.

As with all intelligence agencies, it is one thing to gain a flow of information, and another to use it correctly. American decision-makers are overwhelmed by a ‘fire-hose’ of classified, secret, top-secret and urgent information produced by that country’s sprawling intelligence ‘community’.¹⁶ Much of it is dross, either recycled or poorly sourced. Much less is known about Russia’s use of intelligence, although it is clear that Mr Putin takes a close personal interest in the output of his country’s agencies – people who know his daily routine say he habitually spends a couple of hours a day reading its reports and cables, while shunning more conventional (and perhaps more useful) sources of information.

For whatever reason, however, Russia does seem to have the knack of searching through floods of data to find the most usable bits. EU officials who deal with Russia, for example, have told me that they frequently have the impression that the other side already knows every part of their negotiating position. It is easy to scoff at this: why should anyone care if the Russians bamboozle the Eurocrats? The answer is simple. If Russia understands which countries are the die-hard supporters of a particular EU policy that it does or doesn’t like, which are the wobblers, and what is the negotiating position, it knows where to apply diplomatic pressure (or when not to waste time and effort fighting a lost cause).

The EU talks to Russia about matters of vital interest to every member-state’s citizens, but a prime example is energy. Here the picture has shifted sharply over the past decade. Ten years ago, Russia was seen as a bright prospect for Europe’s future oil and gas supplies, and a source of nuclear expertise, fuel and technology. Since then corruption and incompetence at home, and bullying behaviour abroad have eroded Russia’s clout, to the point that even Germany is now sceptical about its reliability. In the past, Germany was heavily dependent on Russian gas. Its biggest energy companies were closely tied to Gazprom, and the former German Chancellor, Gerhard Schröder, took on the chairmanship of a controversial Russian–German gas pipeline on the Baltic seabed soon after he left office in 2005. In his time Germany resisted any attempt to talk toughly to Moscow on energy and other issues: many outsiders saw that as sinister. They feared that the gas supplies had anaesthetised the country’s prudence and scepticism when it came to policy towards Russia.¹⁷

That has changed. Russia’s squabbles with transit countries such as Ukraine have interrupted gas supplies to Europe and rattled German confidence. Angela Merkel, Mr Schröder’s successor, is instinctively more hawkish about Russia. Corruption and incompetence in Gazprom and elsewhere have raised fears about Russia’s ability to meet its long-term supply commitments. New gas supplies are available from elsewhere – chiefly Liquefied Natural Gas (LNG), which can be delivered by sea from distant suppliers. Only five years ago this was scarce and expensive. But technological change has made tankers and terminals cheaper, while new extraction techniques mean that more gas is on the market. The days when Russia’s east-west pipeline monopoly created a lock on European energy supplies are over.

But Russia is now playing a hard defensive game. It no longer controls the bottleneck in supplies. Instead it wants long-term contracts, stakes in downstream distribution systems and market information. In Britain, those dealing with Gazprom’s local subsidiary say that its behaviour is less that of a new entrant into the market, and more of an intelligence operation. The head of counter-intelligence for Germany’s BfV security service, Burkhard Even, highlighted the role of Russian spies in

Russia is in most respects a backward country – a source of humiliation to those who remember that the Soviet Union was the country that put the first satellite, living creature and human being into space. Closing that gap through the normal process of industrial development seems all but impossible. Despite remaining pockets of excellence in the education system, ambitious Russians head abroad, rather than building their businesses at home.¹⁹ Though Mr Putin is personally determined that Russia become a world leader in nano-technology, building such hi-tech industry from scratch is hard: Russia does have plenty of brainpower, but it is starting ten years later than competitors in Germany, America and Britain. The only way Russia can hope to close the gap is by stealing secrets, either to take advantage of them in its own industry, or to trade elsewhere (principally to China). One way of doing that is snooping on other countries’ communications.

Use Google Earth to search for 57º48’8.20”N 28º12’58.59”E and you will see a snapshot, taken from space, of a large collection of satellite dishes on the westernmost extremity of Russia, on the Estonian border, to the north-east of the main A-212 road from the provincial capital Pskov. Even viewed from on high, the gleaming metal and bright paintwork make it clear that this is a new installation; the long shadows cast by the guard fence and sentry posts around the antenna array indicate a high degree of security. Google now helpfully labels it ‘Center FAPSI’²⁰ and an enterprising photographer has provided a fine picture of it.²¹ Western intelligence officials were initially puzzled about the facility’s purpose. Russia already has an archipelago of electronic listening stations: why build a new one exactly there?

The answer was that this particular corner of Russia overlapped, just, with the then footprint of the main Inmarsat 4-F2 satellite, which sits high over the Atlantic ocean in a geostationary orbit carrying a huge quantity of data between Europe and the United States.²² Such data networks are of great interest to Russia. The ability to listen in to mobile phone calls, bug emails, observe web-browsing habits and obtain passwords are essential ingredients of other espionage operations, both in gathering politically sensitive information and in garnering compromising material that can be used for blackmail – and also in stealing other countries’ commercial and industrial secrets.[21]

Industrial espionage was a big feature of Soviet-era intelligence too. But the economic planners who ran industry then were mostly incapable of putting into production the techniques and technology that the KGB’s spies so painstakingly and brilliantly acquired during the Cold War. Many of those constraints have now gone. Russian state-backed high technology companies operate more effectively than their Soviet-era predecessors. One reason is that they are not shackled by the constraints of the planned economy. Another is that the paranoid culture of secrecy has faded. Their experts and executives can travel freely; Western controls on the export of sensitive equipment that frustrated Soviet engineers during the Cold War have lifted.²³ Not only can the stolen material be better used, but the threshold of treachery when obtaining it has sunk. In the days of ideological competition between East and West, even the most hard-up Western scientist might think twice about helping a totalitarian superpower whose very existence was based on lies and mass murder. Helping Russia sounds a lot less bad: after all, many Western businesses and politicians have deep interests in that country too. A German scientist or engineer who succumbs to a Russian approach to pass on secrets from his firm or university laboratory could be forgiven for thinking that if senior public figures can enrich themselves through connections with Russia, humble boffins can do the same.

Overall, America is the top target for Russian foreign intelligence. The partnership that has developed since the ‘reset’ is grudging and cautious, while the adversarial approach is deeply rooted and instinctive. As well as harassing and monitoring members of the Russian diaspora, a prime goal for the Russians is to assess and if possible influence policy-making. This includes scrutinising anyone who presents a direct or indirect challenge to the regime in Moscow through their activities in political life in Washington, DC, such as retired officials, commentators and policy-makers; and think-tank and academic experts who are involved in policy that affects Russia, its interests and its neighbours. Practical targets range from the symbolic, such as the repeal of the Jackson-Vanik amendment,²⁴ to the wonkish, such as understanding arguments in the Senate about arms-control treaties. A prime strategic interest is to weaken transatlantic security ties, thus strengthening Russia’s position in Europe. This is behind the Russian demands (so far fruitless) for a new European ‘security architecture’ that would exclude America and give Russia a legally binding veto over the continent’s decision-making. To that end, Russia stokes anti-Americanism in Europe and eagerly encourages American policymakers and thinkers to see the world in terms of bilateral deals between superpowers, rather than the sentimental old alliances of the last century. Russia is pushing on an open door in this: America’s commitment to NATO is weakening, as is Atlanticist sentiment in Europe.

Another priority for Russian spymasters is to promote the interests of their country’s business. The decision in 2010 to allow Rosoboronexport, the biggest Russian arms exporter, to renew operations in the USA is an example of a major breakthrough. Russia is interested in the listing requirements, disclosure rules and other hurdles that govern access to American capital markets (this is the ultimate goal for corrupt officials and businesses the world over: a listing not only brings in a cash windfall from foreign shareholders, but also gives an instant aura of respectability).

Russia also worries about the rapid growth of shale gas production in the United States. This means that America no longer imports LNG from other producers, creating a glut on world markets, which has allowed European countries to diversify their supply away from Russian pipeline gas. More generally, Russia seeks to limit America’s influence in world energy markets as well as to promote the interests of companies such as Gazprom and Rosneft. Associated with this are politically exposed Russian citizens who find it difficult or impossible to gain an American visa. Russian officials lobby the executive branch to allow these individuals to enter the United States, and try to bring additional pressure to bear via Congress. A signal example here has been the case of Oleg Deripaska, a Russian tycoon whose efforts to visit America have been dogged by controversy.²⁵

The final and most dangerous Russian aim is to penetrate NATO countries’ security and intelligence agencies. Two notable successes in America in recent years are the cases of Aldrich Ames and Robert Hanssen. Ames was a senior CIA counter-intelligence officer dealing with the Soviet Union. Before his arrest in 1994 he betrayed more than a hundred operations and twenty-five agents in the KGB and other Soviet power structures who had entrusted their lives to America. Around ten were executed. Hanssen was a senior FBI officer whose job was supposedly catching Russian spies, until he was exposed as one himself in 2001.

Espionage pervades this story, but in its classic form is only part of it. In all, Russia uses multiple tactics in pursuit of its goals. One is lobbying and diplomatic pressure. This is traceable through a close examination of the trade press, which reveals the growth and scope of Russian lobbying efforts, as well as declarations made under the Foreign Agents Registration Act (which was used as a legal stopgap to charge the spies caught in the summer of 2010). The second is the use of ‘unorthodox’ but legal tactics. These include threatening critics of the regime with legal action in English courts. The First Amendment protects freedom of speech in America, but it cuts no ice in London, where a defamatory statement risks a costly lawsuit, in which the author must justify the allegation with facts, or proof of fairmindedness or fact-checking. This has led a number of think tanks and analysts, even in America, to rephrase or withdraw their criticisms. Another carrot-and-stick tactic is to offer (or withdraw) access to meetings with Russian policy-makers such as Valdai, an annual shindig at which journalists, academics and think-tank experts are given a lengthy interview with Mr Putin.²⁶ More scandalously, Russian lobbyists may also offer to donate (or withhold) funds for research programmes at think tanks and universities. Such activities may involve agents working either at Russian diplomatic missions or undercover.

Russia also enjoys a direct presence in foreign media. The Russian taxpayer in 2010 regularly subsidised struggling foreign newspapers including the Daily Telegraph and the Washington Post, which printed special advertising ‘supplements’ called ‘Russia Now’,²⁷ highly flavoured to suit the official line and produced by Rossiyskaya Gazeta, a government newspaper with a disgraceful record of historical falsification and propaganda peddling.²⁸ The print editions try to make it clear that the inserts are not the work of their own journalists. But the paid-for material nestles on the newspapers’ websites, with a layout very similar to that of the real journalism. A disclaimer in tiny print states: ‘Russia Now is Paid Supplement [sic] to the Washington Post.’ On the Telegraph website a more prominent one reads: ‘This online supplement is produced and published by Rossiyskaya Gazeta (Russia), which takes sole responsibility for the content.’ But it does not specifically say that money has changed hands. A casual browser could easily be confused.

Also in Britain, two prominent papers, The Independent and the London Evening Standard, are in the hands of Evgeny Lebedev, the son of a former KGB officer, Aleksandr Lebedev, who worked in the Soviet-era rezidentura in London and is unfondly remembered by dissident émigrés of that era (he also became famous in September 2011 for his unrepentant use of violence against a fellow-discussant on a television programme).²⁹ The papers have covered some otherwise boring Russian business stories with notable alacrity, and chronicled the social activities of their proprietor (to be fair, hardly unusual in the British media). No consistent signs have yet appeared of interference with the editorial line on Russia itself. (The Independent’s diplomatic editor, Mary Dejevsky, is a well-known British specialist on Russia whose distinctively optimistic line on the country’s prospects and problems long predates the paper’s change in ownership.) None of the other papers mentioned has adopted a pro-Russian stance, though the general shrivelling of budgets for foreign coverage has certainly weakened their ability to follow the intricacies of Russian politics and business.

More worrying than the advertising largesse and changes in ownership is the wider, subtler effect of Russian money on the media. Russian agents are adept at cultivating their media contacts, and in offering access in return for favourable coverage. Those who write hostile stories may find that they are no longer invited to Valdai. For professional Russia-watchers, an invitation to this event, normally held in November, is tantamount to a job ticket. Being barred can be a career-chiller, or killer. A tougher sanction, for journalists who are consistently critical of Russia, is a visa blacklist compiled by the FSB.

Russian influence and subversion crops up across the entire spectrum of public life in EU countries and America. Much of what goes on cannot be discussed openly for fear of libel suits, but occasional scandals give at least an outline picture. One is the role of Russian agents in bribing, blackmailing or bamboozling politicians. Sometimes the results are remarkably unsubtle, such as when they slavishly follow Russian talking points and voting strategies in international bodies such as the Parliamentary Assembly of the Council of Europe and the Parliamentary Assembly of the Organisation for Security and Cooperation in Europe. Readers may be forgiven for never having heard of either outfit: they are well-funded talking shops that pass sententious resolutions of great prolixity and little weight. However, Russia finds them useful forums for its agenda, for example, highlighting issues that divide or embarrass its European critics.³⁰ More important than the bodies’ activities, however, is their membership: they consist of lawmakers who also have important jobs back home.

Those who observe the meetings of these bodies notice how often attractive young Russian and East European women accompany some of the middle-aged male MPs who make up the bulk of their membership. In most cases these women have doubtless been hired solely for their research skills. But the suspicion remains that in at least some cases someone has assigned them to these elected officials, with the aim of influencing their decision-making or obtaining sensitive information. This does not necessarily involve treason. Some politicians are stupid and naive enough to hire and hobnob with questionable assistants without considering that anything might be amiss.

In 2010, for example, Britain’s Security Service was alarmed to note that Katya Zatuliveter, a Russian citizen working in Parliament, had met a Russian intelligence officer based at the embassy in London. The spycatchers were convinced that they had spotted an active and dangerous spy. The use of attractive young women – lastochky (swallows) – to seduce Western targets was a mainstay of the KGB playbook. Ms Zatuliveter had a lengthy affair with her employer, Mike Hancock MP. He was a classic target: forty years older than her, portly, self-important, married – and also a member of the House of Commons Defence Committee and the Council of Europe Parliamentary Assembly. She later bedded a senior NATO official (also married) dealing with Russia and Ukraine. No young British woman could enjoy a comparable career in Russia.

The Home Secretary ordered Ms Zatuliveter’s deportation. She appealed (odd behaviour if she were in fact a spy) – and MI5 suffered an unprecedented public embarrassment. The appeal tribunal included Sir Stephen Lander, the former director of MI5, as one of the three judges. The evidence MI5 presented in open court was unconvincing – and so too, apparently, was what it argued in the secret sessions. The tribunal concluded that it was unlikely Ms Zatuliveter was a spy: far more likely, she was just ‘an immature, calculating, emotional and self-centred young woman’.³¹ That she had met a Russian intelligence officer in London counted in her favour: were she really a spy, she would shun any such contact and meet her case officer only on her regular trips to Russia. It was astonishing that, even in secret, MI5 was unable to produce conclusive evidence of any wrongdoing. Nor was it clear why the service had risked publicly demanding its quarry’s deportation. A quiet warning would have stopped any espionage in its tracks. And if Ms Zatuliveter was a real spy, why not watch her in action? One explanation may be that MI5’s once-fearsome expertise in Russia has decayed severely since the end of the Cold War.

Whatever its practical failings, MI5 and sister services are right to believe that Russian citizens visiting the West under their own names are a far bigger part of the Kremlin’s espionage effort than old-fashioned ‘illegals’. A plausible example of the new echelon would be a comely young PhD student bearing a passport from an East European country (Commission officials responsible for counter-intelligence sometimes mention Bulgaria in this context). This ‘student’ of EU affairs is attractive, inquisitive and ruthless. She gets a job first as an intern, then as an assistant. That creates one line of attack. Simultaneously, she is researching her PhD (perhaps on EU energy policy, or trade relations with Russia, or some other topic of interest to the Kremlin). In one sense her behaviour is entirely legitimate. It is not a crime to ask questions flirtatiously, or to sleep with officials who answer them. Her identity may be forged, but is more often completely legitimate: perhaps acquired during a brief but perfectly convincing marriage to a Bulgarian. Only a detailed security vetting would uncover a family connection with Soviet-era intelligence structures and a stint learning spycraft in Russia. This ‘student’ (an amalgam of some real-life examples) will probably avoid any position where she comes under direct scrutiny: a job at NATO, for example, or in the commission’s new External Action Service. But her flatmates, bedmates or officemates may work in just such roles, and she will be only one step behind. Indeed, secretaries in sensitive offices in the European Union’s institutions turn out surprisingly often to have been born in the core countries of the former Soviet Union. They have EU passports now and it would be a suspicious soul who begrudged them a chance to make the best of the careers open to them. Nobody seems bothered by their presence or willing to check up on them; and if they did, it would be hard to know if a regular trip to see family in Russia was just that, or included a meeting with a spy agency. Such people are one arm of the Russian effort abroad and I will return to them later. But when they are not available, Russia’s spymasters turn to another reservoir of potential agents: the diaspora.