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Can anyone speculate why it was wrapped in a toilet paper roll?

That seems odd, especially since it would dampen the sound recording

I wouldn't call it a "roll". There's an image in the sfstandard.com article. It is odd. Looks more suspicious than without it.

The text says "concealed in toilet paper" and the pic looks like a mostly empty toilet roll to me.

But maybe he didn't put a case on the device? I think if he'd 3D printed something or wrapped it in black tape it would have been a lot less visible.

I wonder if it was found when someone was trying to plug a cable into the TV?

Assuming the guy is minimally competent, its not for concealment but probably for audio capturing reasons. Concealment like that makes no sense, the device it self would look more like a remote screen plugin without the paper.

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