Spies are back in business - or did they ever go away?

The Cold War may be over, but espionage is alive and kicking, as Americans absorb the news that an alleged Russian sleeper cell may have been living in their midst

Awoman journalists have identified as Anna Chapman, who was arrested on charges of conspiracy to act as an agent of a foreign government.

It may not quite live up to the plot of a James Bond novel, but the arrest of 10 suspected Russian spies in the United States has rekindled memories of a Cold War era that many people assumed had crumbled to dust around the same time as the Berlin Wall.

The media has been transfixed in recent days with allegations that 10 Russian "sleepers" have been living apparently normal lives in the suburbs. While Michael Farbiarz, the assistant US attorney, described the deep cover espionage ring, in place since the early 1990s, as "just the tip of the iceberg", its success in penetrating America's political or industrial base appears limited. The suspects are accused of a conspiracy to act as unlawful agents of a foreign government, a crime much less serious than espionage. If convicted, they face up to five years in jail. Nine also face charges of money laundering.

It is apparent the FBI have been bugging them for years. In a clandestine raid on the home of two suspects, Richard and Cynthia Murphy, known as the New Jersey Conspirators, agents found the 27-letter password to a computer disk. This gave them access to a computer programme that allowed a message to be stored on an internet image and then decoded back in Russia. Such hi-tech subterfuge was marred only by the couple's inability to memorise a 27-character password. As a result they had written it down.

The arrests were triggered by FBI fears that one of the suspects, Anna Chapman, 28, a divorcee, had been tipped off that her cover had been blown and was preparing to return to Russia. Ms Chapman, a green-eyed redhead, the daughter of a Russian diplomat, had not tried to conceal her Russian identity in New York and claimed to be building up a recruitment agency targeting young professionals. The FBI claims the spy group used a range of methods, from hi-tech private wi-fi networks to swap data, to old school "brush pass" money drops.

Ms Chapman is accused of transferring data from her laptop to a Russian government official passing in a people-carrier as she sat in a Manhattan cafe. Christopher Metsos, 55, a Canadian passport holder and an 11th suspect, was arrested in Cyprus but has apparently disappeared after being granted bail. He is accused of being the group's money man and said by the FBI to have swapped identical orange bags with a Russian official in a "brush pass" on a stairway in Queens station. This was said to have been the method used to transfer fake travel documents.

One of the 10 suspects, a journalist, Vicky Pelez, has been told by a New York judge that she could be granted bail by early next week. Her husband, Juan Lazaro, an academic, has confessed in a letter to the court that he was in the pay of Russian intelligence and has refused to give details of his true identity. His loyalty to "the service" was worth more to him than his children, the letter said.

With such an intriguing and tangled plot, it would appear espionage by Moscow on Washington - and vice versa - may well remain an enduring part of US-Russia relations. In fact, evidence from recent days shows that spying in its most traditional sense remains alive and well throughout the world. The manager of a mobile phone company was arrested in Lebanon and accused of spying for Israel. Ecuador accused the Colombian secret service of electronic eavesdropping on President Rafael Correa. Germany's ministry of the interior revealed that two high-ranking Chinese officials were being investigated for espionage.

Arguably the second oldest profession, the spy business has proved extremely durable in modern times. "Satellite and other electronic surveillance devices have made extraordinary advances in recent years and provide vital intelligence in many areas, such as Iran's nuclear programme," a security source told The National yesterday. "But there can often be no substitute for the human asset on the ground. Spy satellites can take pictures, listening devices can hear conversations, but neither can ask questions. Often they don't let you know what people are really thinking."

Jonathan Evans, the director general of Britain's MI5 counter-intelligence service, reinforced the message when he warned recently that while much of the intelligence effort in the UK was concentrated on counterterrorism, "we must not forget that old-fashioned espionage goes on." Perhaps the most surprising thing is that the American "spy ring" was seeking the sort of information - political, financial, nuclear development and so on - that Sir Christopher Meyer, Britain's former ambassador to Washington, believes any half-decent embassy staff should have been able to supply.

It does illustrate, however, how spying in developed nations is much more likely these days to focus on industrial or economic espionage than on obtaining military secrets. Burkhard Even, who runs a federal government programme in Germany aimed at thwarting commercial espionage, says the problem is growing. "From what we have seen, the dangers posed to the German economy through industrial espionage and competitive spying are very real," he says.

"If you're asking me to name names, the intelligence services in two countries in particular spring to mind: Russia and China. But let me make it clear that if we're talking about competitive espionage, I can assure you it happens all over the world." Last week, Richard Fadden, the director of the Canadian Security Intelligence Service, disclosed in a CBC interview that two provincial cabinet ministers and a number of government employees were being monitored after concerns that they had become "agents of influence" for foreign powers.

The countries trying to recruit the politicians and officials were said to be China and unnamed nations in the Middle East. Mr Fadden said these and other nations target idealistic and ambitious university students to influence them early on in their careers. Agents would endeavour to keep in touch with them, he said, hoping to influence or gain knowledge of economic developments. "Before you know it, a country is providing them with money, there's some sort of covert guidance," he said.

Sir Christopher Meyer, whom the KGB tried to lure into "honey traps" three times while he was working as a diplomat in the old Soviet Union, believes that Russian spy agencies are as active today as they were in the Cold War, with sleeper cells being a hallmark of their activities. "One myth needs to be dispelled straight away is that, with the fall of communism, the Russian propensity to engage in aggressive espionage against the United States, Britain and other Nato members ceased," he says.

"Russia under President Dmitry Medvedev and Prime Minister Vladimir Putin - a former KGB officer, don't forget - is a tough, unsentimental, nationalistic state "The issue for the new British coalition government is that, if there are sleeper cells of Russian spies in the US, it is more than likely that they are here in Britain, too." Ben Macintyre, a columnist on The Times and author of non-fiction spy books, believes that both the FSB, Russia's federal security service, and the SVR, its foreign intelligence service, the successors to the KGB, have become adept at playing the spying game "with particular skill and ruthlessness".

Yet he says that while Washington expresses outrage over the latest incident, "western intelligence agencies are doing precisely the same thing in Russia". And it has been going on for centuries, if not millennia. Ancient writings of Chinese and Indian military strategists recorded the frequent use of spies. Joshua is said to have led 11 spies into Canaan in 1480 BC. Alexander the Great reputedly spied on his own soldiers more than 2,000 years ago.The ancient Egyptians operated a sophisticated spy network, as did the rulers of the Greek, Roman and Mongol empires.

In England, King Alfred the Great personally demonstrated the efficacy of the art by disguising himself and wandering round the military camps of the invading Danes, gathering intelligence that he used to defeat them at the Battle of Edington in 878. Alfred's disguise, however, is scarcely the stuff of today's spies, who come in many shapes and sizes, according to Mr Macintyre. "Some are motivated by ideology or patriotism," he says. "A surprising number act out of pure greed, for the financial rewards can be huge. Others find themselves drawn into the murky world by sex, blackmail, revenge, disappointment, or the peculiar one-upmanship that secrecy confers.

"Many spies are undoubtedly motivated by the perceived romance, the opportunity to live a second, secret life. Some are fantasists."

"Many spies are undoubtedly motivated by the perceived romance, the opportunity to live a second, secret life. Some are fantasists." He cites Pavel Sudoplatov, Stalin's spymaster, who was an expert on the psychology of espionage and the recruitment of spies. "Search for people who are hurt by fate or nature - the ugly, those craving power or influence but defeated by unfavourable circumstances. In co-operation with us, all these find a peculiar compensation," he says.

"The sense of belonging to an influential, powerful organisation will give them a feeling of superiority over the handsome and prosperous people around them." Glenmore Trenear-Harvey, an intelligence analyst, says that agents such as the suspects in the US will move into a community and live apparently normal lives for years. "What an illegal does is adopt the persona of someone else - it's classic identity theft," he says. "They will take the identity of a dead person for example and then they will work within the community. Their children will be born and raised there and, to all intents and purposes, they are the good guys.

"But all the time they are waiting to be activated by controllers. What is remarkable about this particular case is that this isn't one or two individuals; this is deep penetration. This is a ring of 10 or 11 people. It is the most remarkable spy story that has happened in the past 15 to 20 years." Oleg Gordievsky, a former KGB colonel who worked as double agent for the British before defecting, is not surprised by the story unfolding in America.

He says that since the end of the Cold War, Russia has been dispatching dozens of agents to industrialised nations, believing them to be immune from detection. "This is a case of the United States simply telling Russia, 'For 20 years we have tolerated your activities in our country and we are now saying we are watching you and we will act if you do not stop.'" But stopping spying appears as much of an impossibility as bumping off James Bond. "There is no place where espionage is not possible," observed Sun Tzu, the Chinese general and philosopher.

His words might be 2,500 years old, but they still hold true throughout the world. @Email:[e-mail]