Russia accuses Georgia of aiding rebels

MOSCOW (Reuters) - Russia's domestic spy service on Friday accused Georgia of supporting armed rebels in southern Russia, an accusation that could further damage the strained relations between the two countries.

A source in the Federal Security Service (FSB) told Interfax news agency that a Chechen man working for Georgian intelligence had been giving cash to fighters across the turbulent North Caucasus.

"This confirms that Georgian special forces have participated in subversive terrorist activities in the North Caucasus," Interfax quoted the FSB source as saying.

Russia and Georgia are locked in a row over Georgia's two breakaway regions of Abkhazia and South Ossetia, which Russia supports. Georgia says war was only narrowly averted earlier this month.

The FSB's claim surfaced just as a Georgian minister was to meet officials from Russia's Foreign Ministry in Moscow to discuss how to repair relations.

A Georgian government spokesman in Tbilisi denied the FSB's accusation, saying: "It's another lie and another provocation from the Russian side."

Russia has repeatedly said Georgia turns a blind eye to rebels on its territory who plot attacks in the turbulent north Caucasus region, where Russian soldiers have fought two wars since 1994 against rebels in Chechnya.

The Kremlin has made a deal with a former warlord in Chechnya and is eager to present the area as peaceful. But violence still flares sporadically in Chechnya and the neighboring republics of Ingushetia and Dagestan.

Interfax quoted the FSB as saying the spy was a Chechen man who was born in Georgia 1974 but had Russian citizenship.

"In particular, he was to organize contact between Georgian special forces and illegal armed groups in Russia," the FSB source said.

The spy was also supposed to make contact with traffic police to guarantee rebels free movement, he said.

An FSB spokesman declined to comment. The powerful FSB often leaks information through news agencies such as Interfax.

President Mikheil Saakashvili has angered Russia with his drive to take Georgia into both the European Union and NATO.

The Interfax report did not give details on when, where and how the FSB had uncovered the alleged spy, but it did say he had worked in Ingushetia and two other southern regions.

(Writing by James Kilner; Editing by Kevin Liffey)