Chechen officials who had seen the tape said it was apparent the man had been forced into making the "confession". Their employers and the Foreign Office said there was no truth in the claims and their relatives said the video "added to their revulsion".
The Independent has learnt the identity of the man believed to have kidnapped and killed the four engineers. Sources in the Chechen capital, Grozny, said security forces were hunting Arbi Barayev, a young Islamic extremist linked to previous kidnappings.
The video was shown yesterday by the Chechen Vice-President, Vakha Arsanov, who said it was found on Wednesday, the day after the severed heads of the engineers were found on a road 40 miles from Grozny. Local journalists watched the video but Aslan Maskhadov, the Chechen President, later refused to release it.
On the clip the men identify themselves as the three Britons, Rudolf Petschi, Darren Hickey and Peter Kennedy, and the New Zealander Stanley Shaw. Mr Kennedy then says in Russian: "We have been recruited by the English intelligence service. We installed a satellite aerial so that all phone conversations on Chechen territory were heard by German, English and Israeli special services and the CIA." He also said he had installed equipment to spy on Chechen military camps and bases.
Mr Arsanov refused to say where they found the video but added: "They must have been forced to confess. But we do not know yet. We will have to check this information."
In London a Foreign Office spokesman said of the video: "It's complete rubbish. You will recall that they were trying to claim Jon James and Camilla Carr [aid workers held hostage for 14 months] were also accused of being spies." Granger Telecom and British Telecom, the men's employers, also denied they had links to the intelligence services.
The British ambassador in Moscow, Sir Andrew Wood, said: "We don't comment on these things in general. But any reasonable analysis would show that we have no wish to spy on Chechen territory."
Eamon Hickey, Darren's father said: "They went ... to install ... telephone equipment with the support of the Chechnyan authorities. These confessions have obviously been forced out of them after they have been threatened."
Ministry of Defence disclosed that Mr Petschi, fluent in several East European languages, had spent 20 years in the Royal Signal Corps. The ministry said he did not have an intelligence background.
The disclosure that security forces are hunting Mr Barayev, a ruthless former Chechen separatist commander, again raised the likelihood that the kidnapping was political. Mr Barayev, in his 20s, is a Wahhabi Islamic fundamentalist whose group has strong ties to Saudi Arabia and who has long been opposed to the secular Mr Maskhadov.
He is believed to been involved in the kidnapping of Mr James and Ms Carr.
He came under suspicion when the engineers were first seized, not least because an injured kidnapper reportedly turned himself in at a hospital at Urus-Martan, 20 miles from Grozny and which is a known stronghold of Mr Barayev. Reports in recent weeks said he had been shot, but survived.
The rise of Wahhabism in the north Caucasus become an issue of profound concern to the Chechen government, and Moscow, which has yet to recognise Chechnya's independence.Reuse content