From: "Rich Gauszka" 

Next they'll have warnings on trying to smoke the Canadian 'poppy'  

http://news.yahoo.com/s/ap/20070507/ap_on_go_ot/spy_coins

WASHINGTON - An odd-looking Canadian quarter with a bright red flower was
the culprit behind a false espionage warning from the Defense Department
about mysterious coins with radio frequency transmitters, The Associated
Press has learned.

The harmless "poppy quarter" was so unfamiliar to suspicious U.S.
Army contractors traveling in Canada that they filed confidential espionage
accounts about them. The worried contractors described the coins as
"filled with something man-made that looked like
nano-technology," according to once-classified U.S. government reports
and e-mails obtained by the AP.

The silver-colored 25-cent piece features the red image of a poppy -
Canada's flower of remembrance - inlaid over a maple leaf. The unorthodox
quarter is identical to the coins pictured and described as suspicious in
the contractors' accounts.

The supposed nano-technology on the coin actually was a protective coating
the Royal Canadian Mint applied to prevent the poppy's red color from
rubbing off. The mint produced nearly 30 million such quarters in 2004
commemorating Canada's 117,000 war dead.

"It did not appear to be electronic (analog) in nature or have a power
source," wrote one U.S. contractor, who discovered the coin in the cup
holder of a rental car. "Under high power microscope, it appeared to
be complex consisting of several layers of clear, but different material,
with a wire-like mesh suspended on top."

The confidential accounts led to a sensational warning from the Defense
Security Service, an agency of the Defense Department, that mysterious
coins with radio frequency transmitters were found planted on U.S.
contractors with classified security clearances on at least three separate
occasions between October 2005 and January 2006 as the contractors traveled
through Canada.

"We'll have a good laugh over it," said John Regitko, who writes
a newsletter for a leading coin-collecting organization, the Canadian
Numismatic Association. "We never suspected there was such a thing (as
spy coins) anyway."

Regitko predicted the quarter will become especially popular among
collectors because of its infamy as the culprit behind the spy warning,
despite the quarter's wide availability. "Everybody has some in their
drawer at home," he said.

One contractor believed someone had placed two of the quarters in an outer
coat pocket after the contractor had emptied the pocket hours earlier.
"Coat pockets were empty that morning and I was keeping all of my
coins in a plastic bag in my inner coat pocket," the contractor wrote.

The Defense Department subsequently acknowledged it could never
substantiate the espionage warning, but until now it has never disclosed
the details behind the embarrassing episode.

In Canada, senior intelligence officials had expressed annoyance with the
American spy-coin warnings as they tried to learn more about the oddball
claims.

"That story about Canadians planting coins in the pockets of defense
contractors will not go away," Luc Portelance, now deputy director for
the Canadian Security Intelligence Service, wrote in a January e-mail to a
subordinate. "Could someone tell me more? Where do we stand and what's
the story on this?"

Others in Canada's spy service also were searching for answers. "We
would be very interested in any more detail you may have on the validity of
the comment related to the use of Canadian coins in this manner,"
another intelligence official wrote in an e-mail. "If it is accurate,
are they talking industrial or state espionage? If the latter, who?"
The identity of the e-mail's recipient was censored.

Intelligence and technology experts were flabbergasted over the warning
when it was first publicized earlier this year. The warning suggested that
such transmitters could be used surreptitiously to track the movements of
people carrying the coins.

"I thought the whole thing was preposterous, to think you could tag an
individual with a coin and think they wouldn't give it away or spend
it," said H. Keith Melton, a leading intelligence historian.

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