From: InfoSec News (alertsinfosecnews.org)
Date: Fri Jan 12 2007 - 00:03:58 CST

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http://www.theglobeandmail.com/servlet/story/RTGAM.20070110.wspycoin0110/BNStory/National/home

By COLIN FREEZE
Globe and Mail Update
10/01/07

A report that that some Canadian coins have been compromised by secretly
embedded spy transmitters is overblown, according to a U.S. official
familiar with the case.

There is no story there, the official, who asked not to be named, told
The Globe and Mail.

He said that while some odd-looking Canadian coins briefly triggered
suspicions in the United States, he said that the fears proved
groundless: We have no evidence to indicate anything connected with
these coins poses a risk or danger.

A report from a Pentagon agency made headlines this week after it stated
unequivocally that Canadian coins found in the possession of U.S.
defence contractors had been tampered with.

On at least three separate occasions between October, 2005 and January,
2006, cleared defence contractors' employees travelling through Canada
have discovered radio-frequency transmitters embedded in Canadian coins
on their persons, reads the U.S. Defence Security Service report.

The account which gave no further elaboration appeared in the latest
annual edition of the agency's Technology Collection Trends in the U.S.
Defence Industry report.

The declassified report also made vague references to other cases,
including one in which a female spy allegedly seduced a U.S. government
translator for his computer password. In another example, a defence
contractor with carpal-tunnel syndrome raised concerns after using a
voice-recorded pen to take notes during sensitive meetings Nothing else
is known about these cases. But the item about the Canadian coins item
appeared to be the result of only partial intelligence.

Defence contractors had apparently been give certain special-issue
Canadian coins, the unfamiliar look of which caused them to be concerned
about the money, a source said. That led to an investigation once the
contractors returned to the United States .

But a U.S. agency that investigated the complaint found no evidence of
any secret transmitters, or of any other tampering.

It's not clear why this information failed to find its way into the
released U.S. Defence Security Service report.

The U.S. agency works with military contractors to make sure that
sensitive U.S. secrets aren't stolen by spies. The case of the Canadian
coins was just one of the case studies released in the unclassified
version of the report.

There is a classified version of the report with more details
circulating within the U.S. government, but officials are not speaking
to it.

Canadian officials, who were not in the loop on the U.S. investigation,
reacted to the transmitter-carrying coins skeptically.

What is the value of a device for tracking someone when it changes hands
so frequently and so readily?, said Alex Reeves, a spokesman for the
Royal Canadian Mint, in an interview.

In addition to standard currency, the Mint produces special-issue coins,
like pink-ribbon quarters to raise awareness about breast cancer or
lucky Loonies to celebrate Canada's accomplishments in hockey.

Mr. Reeves said it is a crime for anyone to tamper with Canadian money.

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