The Associated Press
May 7, 2007
The surprise explanation behind the U.S. government's sensational but
false warnings about mysterious Canadian spy coins is the harmless poppy
quarter, the world's first colourized coin.
The odd-looking coins were so unfamiliar to suspicious U.S. army
contractors travelling in Canada that they filed confidential espionage
accounts about them.
The worried contractors described the coins as "anomalous" and "filled
with something manmade that looked like nanotechnology," said
once-classified U.S. government reports and e-mails.
The 25-cent piece features the red image of a poppy inlaid over a maple
leaf. The quarter is identical to the coins pictured and described as
suspicious in the contractors' accounts.
The supposed nanotechnology actually was a conventional protective
coating the Royal Canadian Mint applied to prevent the poppy's red
colour 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 U.S.
Defence Security Service, an agency of the Defence 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 travelled through Canada.
One contractor believed someone had placed two of the quarters in an
outer coat pocket after the contractor had emptied the pocket hours
"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.
Meanwhile, in Canada, senior intelligence officials expressed annoyance
with the U.S. spy-coin warnings as they tried to learn more about the
"That story about Canadians planting coins in the pockets of defence
contractors will not go away," Luc Portelance, now deputy director for
the Canadian Security Intelligence Service, wrote in a January e-mail to
'What's the story on this?'
"Could someone tell me more? Where do we stand and what's the story on
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 by the warning
when it was first publicized earlier this year. The warning suggested
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.
The Defence Security Service disavowed its warning about spy coins after
an international furore but until now it has never disclosed the details
behind the embarrassing episode. The United States said it never
substantiated the contractors' claims and performed an internal review
to determine how the false information was included in a 29-page
published report about espionage concerns.
Coins not examined
The Defence Security Service never examined the suspicious coins,
spokeswoman Cindy McGovern said.
"We know where we made the mistake," she said.
"The information wasn't properly vetted. While these coins aroused
suspicion, there ultimately was nothing there."
Numismatist Dennis Pike, of Canadian Coin & Currency near Toronto,
quickly matched a grainy image and physical descriptions of the suspect
coins in the contractors' confidential accounts to the 25-cent poppy
"It's not uncommon at all," Pike said.
He added the coin's protective coating glows peculiarly under
"That may have been a little bit suspicious," he said.
(c) The Canadian Press, 2007
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