It seems pretty well established that paper currency (e.g. in the US) is commonly contaminated with trace amounts of cocaine or other illegal narcotics. (See Snopes for instance, though I'm happy to have this assumption challenged.) Is this contamination sufficient to attract alerts by drug detection dogs?

Wikipedia says yes: "The drug content is too low for prosecution but not too low to trigger response to drug-sniffing dogs". But their citation is to a newspaper article that makes no mention of money or currency.

This 1998 Slate article says: "In 1994, a U.S. Circuit Court held that ordinary money contains enough cocaine to attract a drug-sniffing dog." They don't give a reference to the case, but I think it might be US v. Florez; however, the court's opinion only seems to say that the defense claimed this was true (note 12), and doesn't seem to come to a conclusion as to whether it actually is. There is also US v $30,060 in US Currency, in which the court found that a dog's alert on currency is not evidence that the possessor is somehow involved with narcotics, partly due to the fact that money is commonly contaminated. But this seems like a somewhat different question and a different standard of proof, and anyway I'm not inclined to consider judges as scientific experts.

On the other hand, the American Society of Canine Trainers says that "currency in circulation does not contain enough narcotic scent for a narcotic detector dog to alert to", and they also cite case law in their favor.

What data actually supports any of these claims? Does currency commonly contain enough narcotics residue to trigger an alert by a typical drug detection dog, at a rate significantly higher than the usual rate of false positives for such dogs?

[I became interested in this claim after it appeared in this travel.SE answer. Thanks RoboKaren, even though you're not a notable source by yourself.]

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    @LightnessRacesinOrbit: 1) One layer of plastic sheet isn't a good olfactory barrier, when you're talking about a dog's sense of smell. 2) Avoiding outside contamination when doing the packaging is extremely difficult. -- Next time you prepare food for the deep freeze, try smelling the plastic bag. I'm able to smell a Bolognese through a closed Tupperware box, and I'm not a sniffer dog... ;-) – DevSolar Dec 3 at 11:48
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    link.springer.com/article/10.1007/s10071-010-0373-2 popped up on some other forum, again not directly an answer but in a trial 85% of the time a dog and handler team made a false alert. – daniel Dec 3 at 12:04
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    @DevSolar I'm no expert but I think drugs are wrapped in more than a single plastic sheet or a tupperware box :P – Lightness Races in Orbit Dec 3 at 12:06
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    @LightnessRacesinOrbit: And even multiple layers of cling film still have all the problems mentioned. I just wanted to point out that it's not true that "a plastic bag ought to literally prevent anyone from being able to smell the product". The same procedures (or lack thereof) that make traceable amounts of cocaine show up on dollar bills (contamination) makes them show up on the outside of those packages, which is why they're e.g. hidden in coffee or otherwise "masked". Because dogs can sniff them out. Trying to avoid any conspiracy / harassment theory springing up here. – DevSolar Dec 3 at 12:10
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    @LorenPechtel: That would be pretty shoddy training, then. The training I've seen (documentaries about), the drill is done "double-blind", i.e. the handler doesn't know where the drugs are either. Exactly so the dog cannot "pick up" anything from the handler in training, and thus won't go for "handler cues" in the field either. Perhaps a separate question? – DevSolar Dec 4 at 8:47

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