A row between the Prison Service and the agency fighting organised crime broke out last night over allegations that prisoners are using interactive internet games to run global crime empires.

The allegation was made, without warning to prison chiefs, at the launch of the annual report of the Serious Organised Crime Agency. Bill Hughes, the director-general of Soca, said that organised crime bosses were operating their multimillion-pound empires from behind bars by using internet games to pass on their orders.

Some were using code words in chat-room facilities on interactive games to operate from within jails, it was alleged by Soca. They are also said to be using games consoles such as PlayStations to charge mobile phones smuggled into prisons. Prison guards are unwittingly passing on coded information in what appear to be innocent messages from criminals to their relatives.

Mr Hughes said: “We know that one of the issues is that if you are locked up, how do you communicate with others? And we have been highlighting the fact it is not always with mobile telephones.

“There is other technology used — people are using PlayStations to charge their mobile phones and are playing games interactively with others, so are able to communicate with them.

“The Prison Service is concerned that prisoners are using interactive games to talk to people outside the prison. Communication is the name of the game and criminals are looking to exploit new technologies. Prisoners have rights and they have access to the internet. Some new prison guards are also being used without knowing it, but they soon become streetwise.”

The remarks provoked a furious response from the Prison Service which issued a statement in which it sought to demolish them.

Phil Wheatley, the Director-General of the Prison Service, had a telephone conversation with Mr Hughes about the comments in which, it is understood, the director-general of Soca apologised for his remarks.

Soca did not disclose on what intelligence Mr Hughes had based his remarks.

A Prison Service spokesman said: “Prisoners have never been allowed access to wireless enabled technology such as that used in some games consoles. Nor would they ever be allowed access to such technology.

“A decision was taken some years ago that the then-current generation of games consoles should be barred because the capability to send or receive radio signals is an integral part of the equipment.”

Soca said last night that it stood by its intelligence that prisoners were using PlayStations and interactive internet games to communicate with gang members outside prison.

Both sides attempted to defuse the controversy by issuing identical statements which said: “Soca and the Prison Service work closely together to prevent criminals continuing their activities in prison.”

The row erupted after Soca disclosed that it is monitoring 5,000 crime bosses in Britain and abroad, which is 3,000 more than last year. Sir Stephen Lander, retiring chairman of Soca, added: “Many of the 5,000 are not in the UK but are impacting on the UK from overseas. Some are in prison running their organisations and we are working with colleagues in the Prison Service.Recidivism among organised criminals is high.

“These are lifestyle choices for these people. They will go to prison and we need to find a way of making it more difficult for them to re-engage.”

One attempt at doing this is the use of Serious Crime Prevention Orders, which would allow criminals to carry only one mobile telephone and to carry only £1,000 at any time.Gordon Brown announced this week a new strategy in the fight against crime — a tacit admission that the problem was out of control.

In its annual report, released yesterday, Soca revealed that over the past year it had seized or frozen assets of more than £263 million through confiscation orders, cash seizures or forfeitures and through the civil courts.

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