She was suspected of being a spy.

Literal

She [topic-は] spy [quotative-と] was-suspected.

疑う ('to suspect') in passive form (疑われる) takes the suspected identity or fact via the quotative と — literally 'be suspected as / quoted as being a spy'. The と here is the same quotative particle that introduces reported speech and embedded thoughts. スパイ is a katakana loanword from English; an older or more domestic alternative is 諜報員 (ちょうほういん) or 間者 (かんじゃ), each with a different historical flavor — the latter dating back to feudal-era espionage.