U.S.: Whoops! Official report of Canada spy coins not true

By TED BRIDIS
Updated: 4:16 p.m. ET Jan. 18, 2007

WASHINGTON - Reversing itself, the Defense Department says an espionage report it produced that warned about Canadian coins with tiny radio frequency transmitters was not true.

The Defense Security Service said it never could substantiate its own published claims about the mysterious coins. It has begun an internal review to determine how the false information was included in a 29-page report about espionage concerns.

The service had contended since late June that such 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.

"The allegations, however, were found later to be unsubstantiated following an investigation into the matter," the agency said in a statement published on its Web site last week.

Intelligence and technology experts were flabbergasted over the initial report, which suggested such transmitters could be used to surreptitiously track the movements of people carrying the coins. Read More