Moscow: A key suspect in the Russia-US spy scandal vanished in Cyprus after a local court on the divided Mediterranean island released the alleged Kremlin paymaster on bail.
The disappearance of Christopher Metsos, said to be in his mid-50s, provided a stunning twist to a Cold War-style espionage saga that has threatened to upset major efforts to reset ties between Washington and Moscow.
Metsos, who purports to be a Canadian citizen, is accused of being the paymaster for a "deep cover" cell of spies in the United States, furnishing them with money and swapping bags covertly with other Russian operatives.
The spy ring was cracked open on Monday as FBI agents finally pounced on 10 alleged Russian agents in Boston, New York and the Washington area after more than a decade of exhaustive surveillance operations.
Metsos, the 11th suspect, was still at large at the time, but was arrested early on Tuesday at Cyprus' Larnaca airport as he tried to board a flight to Budapest.
To the dismay of US justice officials, Metsos was not deemed enough of a flight risk to be kept behind bars until he could be extradited to the United States.
The local court allowed him to go free on EUR 26,500 (USD 32,330) bail as long as he surrendered his passport and travel documents, pending an extradition hearing on July 29.
There was no sign of the suspected secret agent when Cypriot police rushed to his hotel room on Wednesday after he failed to sign in at a Larnaca police station between 6 and 8 pm, breaking the terms of his bail.
An arrest warrant is now out for Metsos, who could seek to take advantage of the fact that the breakaway Turkish Cypriot statelet in the north of the island has no extradition treaties and serves as a well-known haven for fugitives.
Staff at his hotel in Larnaca said Metsos was last seen at the reception on Tuesday evening and had paid for two weeks in advance with a credit card.
The remaining 10 spy suspects are likely to be less successful in their bail bids in three separate hearings on Thursday to be held in federal courts in Boston, New York and Alexandria, Virginia.
Washington and Moscow have sought to downplay the Cold War-style arrests, with US officials insisting it will not damage President Barack Obama's vaunted "reset" of ties with the Kremlin.
The State Department has styled the episode as a remnant of the Cold War covert intelligence struggle between spymasters in Moscow and Washington that would not have a lasting impact on ties.
Spokesman Philip Crowley reaffirmed on Wednesday that the department was "not anticipating" any diplomatic actions against Moscow and said the Obama administration wants to "move beyond" the incident.
The case harks back to Cold War hostilities with the use of false identities and tales of buried money and hidden video cameras that read like the pages of a spy novel.
During the Cold War, the discovery of spy rings often led to the expulsion of diplomats by either the United States or Soviet Union, which sometimes triggered similar responses from the other side.
The Russian Foreign Ministry -- which initially demanded explanations from Washington, dismissing the arrests as groundless -- has since said it expects the scandal will not hurt relations given the United States' muted response.
The White House said Obama knew the FBI was closing in on the spies when he hosted Russian President Dmitry Medvedev at a summit three days before the arrests, although he obviously failed to mention it in their meetings.
The criminal complaint filed by the US justice department accuses Metsos of being a paymaster for the SVR foreign intelligence service, a successor to the Soviet-era KGB.
On one occasion, Metsos allegedly provides a suspected Russian spy with USD 40,000 in cash and is overheard answering his complaints with: "Well, I'm so happy I'm not your handler."
In scenes straight out of a John Le Carre spy novel, Metsos later performs a "brush-pass" with a Russian government official in which they exchange identical orange bags thought to be full of money.
Metsos allegedly buries half the money in a field in upstate New York, where it is dug up two years later by two sleeper agents accused of seeking to infiltrate US policymaking circles on behalf of the SVR.
First Published: Thursday, July 01, 2010, 08:42