These spies were "illegals," meaning that they were not operating under any official diplomatic cover (this is quite rare; during the Cold War, most spies did their clandestine work on the side of their official jobs within recognized agencies). They're technically only facing charges of failing to register as agents of a foreign government—a 5-year maximum sentence—though there are also substantial money-laundering charges, perhaps due to the bags of cash they were videotaped receiving in South America.
Trained by Russia's SVR ("Foreign Intelligence Service"), the agents, which included several sets of couples, were sent on "long-term service trip[s]", per their official instructions, to "develop ties in policymaking circles and send intels". Basically, to pose as ordinary suburbanites, including buying houses in some cases, "‘to do as the Romans do’ in a society that values home ownership". (This seems to have worked, given the as-ever befuddled quotes the Times gathers from their neighbors. Have we learned nothing from serial killers and sleeper cells? Neighbors never know anything, they always just think that the jihadist/sadomasochistic killer/Russian spy next door was "polite" and "quiet." The Times does get one awesome parody of the archetypal neighbor's response from a teenage girl who says, "They couldn’t have been spies: Look what she did with the hydrangeas.” This girl is awesome.) They were mostly Russian citizens, mostly claiming to be Americans from someplace else, occasionally claiming to be Canadian. (One spy obtained the passport, and assumed the identity, of a dead Canadian citizen. I am looking very closely at Jonny Diamond this morning.) One alleged spy, who really was a US citizen, was Vicky Pelaez, the Peruvian-born columnist for El Diario (anyone want to try to translate that?), who was married to a man who "purports to be" a citizen of Peru. That one is confusing on a whole other level.
The spies were sent here in or around the 1990s, to reside in the community and eventually make contact with people within the intelligence community and learn... stuff? It's still unclear. They never obtained (or, seemingly, made any effort to obtain) any classified documents, though they did communicate in code, both through old-school handoffs in crowded places ("a bookstore in Lower Manhattan"—which one?) and through newer-school "embedded coded texts in ordinary-looking images posted on the Internet".
This bust, timed just after Obama and Medvedev's burger summit, comes after years of surveillance.
The Times has the whole criminal complaint, which I hope to mine for more details quite soon. You are encouraged to do likewise.