Rise of the 'Sloane Rangers'

Helen opened her door wearing a white negligée, smiled coyly and, negotiating a huge mattress covered in a tigerskin-pattern rug, took up a provocative pose on a chair. She said she was 23, but looked younger. She said she was Finnish; her "agency" said she was Latvian.

As Helen chatted about her recent arrival in London, she said the small flat was not home but "just for work". She giggled and repeated: "Just for job." The accent was Russian.

There was immense pathos in the scene. She was clearly nervous and, by her own admission, new to being a prostitute. She stared at the carpet when she talked about what was on offer - sex, at £300 an hour. We were on the first floor of a building in Sloane Avenue, where shops and restaurants such as Kenzo, Joseph and Bibendum suggest a certain cachet.

For the criminals behind a new boom in London vice, the street has become very desirable indeed. They have targeted the area with the establishment of no fewer than 20 micro-brothels, where mainly east European prostitutes work for up to £350 an hour. The women are controlled by escort agencies operating through the internet on websites such as UK Belles, Panache Escorts and City Butterflies.

At least one recent entrant to the business of internet prostitution claimed links to drug smuggling. We tracked him down through his website and, with an undercover reporter posing as an Albanian gangster, learned of his ambitions to traffic in women.

The sheer scale of what is happening in Sloane Avenue is surprising. In two blocks of flats, we found prostitutes operating on nearly every floor. According to the owner of a local chemist, the influx began over a year ago: "I suddenly found we were always selling out of condoms because girls were coming in and buying boxes at a time," he said.

London is a grown-up city and prostitution has always thrived here. Indeed, it is not illegal for a woman to sell sex in her own home. But the Government and police have become concerned over the explosion in vice linked to organised crime, and today Home Secretary David Blunkett issues a consultation document that could lead to sweeping changes in the law.

The proposals could see the decriminalising of brothels and a switch in emphasis from action against prostitutes themselves to the pursuit of pimps and clients. But the cluster of micro-brothels we uncovered in Sloane Avenue shows just how difficult it will be to deal with the new, internetbased, vice-masters.

Through a number of easily-accessed websites, we made appointments with 21 women at addresses in Sloane Avenue. All the appointments were made after negotiations with an "agency". The bargaining was based on an hourly rate for sex which ranged from £150 to £350. The process varies little between websites.

At UK Belles, a link to London Incalls offers appointments in Sloane Avenue for £150 an hour. Asked how many women were available in the street we were told: "About six." Clients give a first name and are allotted a time slot.

Posing as clients, we interviewed and secretly filmed a number of young women, including Helen. Kate, a vivacious brunette who said she was from Estonia, opened her door dressed in bra and knickers. She said she had been working in the street for four months, for an agency. Her hourly rate was £150. She did not say how much of this she received, but the usual rates for women in similar roles are between 25 and 40 per cent of the take, less a contribution to overheads. The flats are usually rented by companies set up by the internet pimps.

Nadia, in a seventh-floor flat, said she was Italian, although it emerged during our conversation she could not speak the language. She said she had been in London for just one week and, like the others, worked for an organisation.

These women operate from several blocks of flats on Sloane Avenue, including Chelsea Cloisters, near the Conran shop at the north end of the street. The freehold of the building is owned by property tycoon Christopher Moran.

He said: "In the 15 years we have owned the building we have acted on two occasions against owners where prostitutes were operating from the flats. It is the last thing in the world we want going on in our building. We have 'triple A' clients and a security staff that works 24 hours a day, walking the floors, keeping a very close check."

The flats being used by prostitutes in Chelsea Cloisters were owned by absentee landlords who had rented them out. It was probable that they, like Mr Moran and his staff, had no idea who their tenants were.

The size of Chelsea Cloisters - it houses 1,000 flats - and the rapid turnover of tenants, allow women like Helen and the others to work without attracting undue attention.

A similar building that has found favour with the internet vice-masters is Nell Gwynn House, an imposing 1930s block on the east side of Sloane Avenue. It is owned by a property investment company, Fairbriar PLC, which runs it through a subsidiary, NGH Properties.

The subsidiary company rents out around 160 apartments, mainly to corporate tenants. One of its flats, number 436, was used by Karina, a blonde in her twenties who said she was from Poland, to sell sex.

She said she had worked from the fourth-floor apartment in Nell Gwynn House since January, acquiring a substantial clientele. When her working day starts at 11am she could expect anything up to seven or eight appointments, all at £300 an hour. Shortly after we began our investigation, however, NGH Properties cancelled the rental contract on her flat.

Manager Mr Jamal Watfa said: "The contract clearly states that no form of business can be conducted from the flat. It's very hard to stop this sort of thing going on, but when the porters notice too many gentleman callers, we investigate. The building appeals to them because it has good security, but we would rather not have them. Our main business is with corporate clients."

Escort agency websites have flourished in recent years and the business has moved away from contact magazines and telephone kiosk card advertisements. When we telephoned City Butterflies about its link to the Sloane Avenue micro-brothels a man said: "We offer ladies for companionship. Whatever the ladies agree with their clients is up to them and nothing to do with us."

People answering the telephone at the UK Belles and Panache Escorts websites refused to handle our enquiries about vice.

Because of the location, far from the less salubrious backdrop of a mainline station like King's Cross, the denizens of the new micro-brothels of Sloane Avenue can be marketed at top rates.

No one knows this better than a man we shall call Simon, one of the new breed of internet-based vice-masters. During our investigation into websites marketing women, we used internet links to make contact with Simon and, posing as a representative of an Albanian criminal gang, an undercover reporter arranged a meeting. He told Simon he was able to bring in illegal women from eastern Europe. The prospect excited him:

"I need girls who will do stuff the others won't," he said. "I'm operating three girls at the moment, but they won't work without condoms. The punters don't like condoms. Now is a brilliant time to expand. The business is there and I could use more girls." He said he had been operating through his website for two months and already had a steady number of clients, around 12 a day.

Asked if he thought the explosion in numbers of women being offered for sex would reduce profits, he said: "No way. The business is definitely there. One of my girls has been through a convenience marriage and is legal here. That's no good. The best deal is to get girls from eastern Europe who are smuggled in. When they are illegal, you can control them."

He said that he had financed his website vice business through profits from drug smuggling. "Are you interested in nose-stuff?" he asked. He claimed he could provide cocaine at £20,000 to £22,000 a kilo through a contact who had a direct link with suppliers in Colombia. "I don't do small," he said. "It's kilos, or nothing."

It is impossible to say precisely who is financing and profiting from the many micro-brothels of Sloane Avenue, or indeed, others that are beginning to proliferate throughout London. But Scotland Yard's criminal intelligence indicates that the vice trade has, over the past three or four years, become dominated by east European gangsters.

The police have identified some individuals and have acted against a number of them. But the scale of what is happening, as evidenced by the Sloane Avenue phenomenon, appears to be overwhelming current resources.

There is a reason for this. Because prostitution itself, under current legislation, is not of interest to the police or, in its isolated form, illegal, action has to be taken under the terms of the 2003 Sex Offences Act. This made causing or inciting prostitution for gain a criminal offence with a maximum penalty of seven years' imprisonment. There are also severe penalties for keeping a brothel and living off immoral earnings.

And Proceeds of Crime legislation renders profits liable to confiscation.

With many hundreds of women being offered for sex, all over London, it might be thought the Yard's detectives would be spoiled for choice. But the last big police operation against an internet-based vice ring took place more than a year ago and it took nearly two years to bring to a conclusion.

In that case, a Russian-born woman, Svetlana Whitley, and her husband, Thomas, were both jailed after being convicted of pimping offences. It was found they ran up to 60 women, many of them illegal immigrants, from a suite of offices opposite Harrods in Knightsbridge.

The women were installed in flats in Knightsbridge and Chelsea and operated precisely in the manner of the Sloane Avenue prostitutes, taking clients who had made appointments through websites. The Whitleys were receiving £100,000 a month from their network and more than £400,000 found in their bank accounts was confiscated.

The Whitley case was a success for the police, but the proliferation of microbrothels in places like Sloane Avenue suggests current law enforcement simply cannot cope with the explosion in internet-based vice.

Mr Blunkett's proposals might help. If not, the growth of sex-for-sale clusters like the one we uncovered in Sloane Avenue may be unstoppable.