They were executed after a breakdown in negotiations during which the kidnappers had demanded a ransom of $10m (pounds 6.7m) - $2.5m a head. Their employers were using London-based security specialists Control Risks to negotiate the return of the hostages for ransom.
One of the men suspected of masterminding the kidnapping was captured - but was released as part of a deal to return the men's bodies to Britain.
The revelations, established through inquiries in Moscow, come as the Westminster coroner will this week set a date for an inquest into the men's deaths. They also stand in stark contrast to the findings of the Metropolitan Police officers who travelled to the Caucasus to investigate the men's death. Their report, a copy of which has been obtained by the Independent on Sunday, provides scant new information and concludes that it is impossible to say why the men were killed.
"Given the tumultuous nature of Chechnya it is not possible to establish with any degree of accuracy why the four engineers were murdered," it says.
The four engineers - Darren Hickey, 26, from Surrey, Rudolf Petschi, 42, from Devon, Peter Kennedy, 46, from Kent, and Stanley Shaw, 48, a New Zealander living in Surrey - were kidnapped on 3 October 1998 in Grozny, the Chechen capital. They were later decapitated and their heads left on the verge of a remote road before the rest of their remains were recovered by the authorities in the former Soviet republic.
While Chechnya is notorious for kidnapping, since their deaths there has been huge speculation as to why the men - who were working on a multi- million-pound deal agreed between Surrey-based Granger Telecom and the state-owned Chechen Telecom - were murdered.
The Independent on Sunday's revelations are based on in-depth conversations with the man who was responsible for the men's safety in Chechnya. Lechi Alisultanov, who has sworn revenge against the killers, said: "I am responsible for the security of my guests. If something happens to them, it is a disgrace and insult."
A spokesman for the family of Mr Hickey said they were disturbed by the revelations and asked that they be made available for the coroner to examine.Reuse content