The arrests in the U.S. of 11 alleged Russian spies -- including four who purported to be Canadians -- threaten to derail attempts to mend relations between the two former superpowers.

Ten of the suspects were arrested Monday and the 11th, Christopher Metsos, who claims to be a Canadian citizen, was arrested Tuesday at an airport in Cyprus while trying to fly to Budapest.

All of the accused were allegedly deep under cover, purporting to lead normal family lives in the U.S. northeast while also gathering and transmitting intelligence about U.S. foreign relations back to Moscow.

Assistant U.S. Attorney Michael Farbiarz has called the arrests just "the tip of the iceberg" of a conspiracy of Russia's Foreign Intelligence Service, known by its Russian acronym SVR.

But Russia's Foreign Ministry angrily condemned the arrests, calling them without merit and suggesting the moves threaten U.S. President Barack Obama's push for a "reset" in chilly Russian-U.S. ties.

"These actions are unfounded and pursue unseemly goals," the Foreign Ministry said in a statement. "We don't understand the reasons which prompted the U.S. Department of Justice to make a public statement in the spirit of Cold War-era spy stories."

The U.S. Justice Department announced the arrests Monday, saying they came after 10 years of FBI work.

Court papers filed in the case say four of those arrested claimed to be Canadian citizens working in the U.S. They include:

• Donald Howard Heathfield and his purported wife, Tracey Lee Ann Foley
• Patricia Mills
• Christopher Metsos

Another of those arrested is Anna Chapman, a 28-year-old divorcee who ran an online real estate business while also allegedly working for the Russian government.

All have been charged with acting as an agent of a foreign government, which carries a maximum of five years in jail. Nine were also charged with conspiracy to commit money laundering, which carries a maximum penalty of 20 years prison. None were charged with the more serious offence of espionage.

According to a detailed criminal complaint, Metsos was the spymaster of the group. He's alleged to have handed out orders to the other operatives, who lived in the Boston, New York and Washington areas.

The complaint alleges the spies received their orders from Moscow Center, the headquarters of the SVR, which is a successor to the Cold War-era KGB. The spies' alleged job was to develop ties in policy-making circles in the U.S. and then send intelligence back to Moscow Center.

According to messages decrypted by the FBI, the spies were told to gather information on the latest U.S. policy on Afghanistan, Iran's nuclear program, and a new weapons treaty between U.S. and Russia.

Heathfield also allegedly met with an unnamed U.S. nuclear scientist seeking information on research into top-secret nuclear warheads.

The alleged spies would then communicate their intelligence back to Moscow via steganography, which are data secretly encrypted into an image that could be posted on a publicly available website but would appear unremarkable to the naked eye. They also used radiograms, which are coded bursts of data sent by a short-wave radio transmitter.

It's unclear whether the ring actually stole any secrets of great importance.

North of the border, the family of one of the men whose identity was allegedly stolen is asking questions about the case.

Brampton, Ont., resident David Heathfield told The Canadian Press that he wants to know how the name of his deceased brother, Donald, wound up in U.S. court files.

Donald died six weeks after he was born in 1963. David Heathfield is concerned that he and his family may now have problems crossing into the U.S., but Canadian authorities have not spoken to him or commented on the case.

Arrests may chill U.S.-Russia relations

The arrests seem likely to embarrass Moscow at a time when the former superpower is trying to mend relations with Washington.

The arrests come days after Obama and his Russian counterpart, Dmitry Medvedev, shared a lunch at a Washington burger joint in a public display meant show that relations between the countries are improving. The arrests also come just a day after the two presidents met in Ontario for the G8 and G20 summits.

Foreign Minister Sergey Lavrov noted the timing of the arrests was interesting.

"They haven't explained to us what this is about," Lavrov said at a news conference during a visit to Jerusalem. "I hope they will. The only thing I can say today is that the moment for doing that has been chosen with special elegance."

Oleg Gordievsky, an ex-deputy head of the KGB in London who defected in 1985, says he believes Russia may have as many as 50 deep-cover couples spying inside the United States.

He told the Associated Press that Medvedev would be aware of the precise numbers of these operatives in each target country, though wouldn't necessarily know their identities.

Arne Kislenko, an associate professor of history at Ryerson University who worked as a senior immigration officer for 12 years, noted that the arrests themselves aren't surprising.

"Foreign espionage happens fairly regularly," he told CTV's Canada AM Tuesday. What is surprising, he said, is the size of the ring and the fact that most of the alleged spies led otherwise normal lives, as married couples working regular jobs.

He also noted that Canadian passports have been used in espionage before. In 2006, for example, Canada's spy agency accused a Russian agent of using a fake Ontario birth certificate to obtain passports.

Kislenko said Canada's passports are coveted because, as a result of our multicultural society, people from any nationality can pose as a Canadian. There are also relatively few visa restrictions against Canadians, and we have a certain ease of access to the U.S.

He noted that Canadian passports are not the only ones sought by spies. "We should also note that Swedish, Norwegian and Danish passports are also very attractive," Kislenko said.

With reports from the Associated Press and The Canadian Press