By Brad Friedman on 1/12/2007, 9:05am PT  

Don't even know where to begin with this story. But begin we must. Don't even know what category to put it in. From AP...

In a U.S. government warning high on the creepiness scale, the Defense Department cautioned its American contractors over what it described as a new espionage threat: Canadian coins with tiny radio frequency transmitters hidden inside.

The government said the mysterious coins 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.

Intelligence and technology experts said such transmitters, if they exist, could be used to surreptitiously track the movements of people carrying the spy coins.

The U.S. report doesn't suggest who might be tracking American defense contractors or why. It also doesn't describe how the
Pentagon discovered the ruse, how the transmitters might function or even which Canadian currency contained them.

Further details were secret, according to the U.S. Defense Security Service, which issued the warning to the Pentagon's classified contractors. The government insists the incidents happened, and the risk was genuine.
...
Top suspects, according to outside experts: China, Russia or even France — all said to actively run espionage operations inside Canada with enough sophistication to produce such technology.

The Canadian Security Intelligence Service said it knew nothing about the coins.