newbie/lurker here...
This was in the paper and on the news here over the last few days. Scary thing is my son had just gotten one of these necklaces at a grocery store two days before the first article.

All the stories have been a bit biased against the dollar stores, but my son's was the same exact necklace from the grocery store.
Full story & pictures at:
http://ydr.com/story/main/14378/
Test on necklace prompts warnings
Lead can prove dangerous to children, whether in toy jewelry or paint chips’ fumes.
Earlier this week, 8-year-old Pammie Sanchez started wearing a necklace that her friend had bought from a toy vending machine.
She wore it for a few days, and even slept with the silver-colored dragon hanging around her neck. On Wednesday, a York City Health Bureau employee discovered that the piece of jewelry tested high for lead.
The necklace had a figure-eight shape, according to Pammie, and cost 50 cents. It was from a vending machine that can be found at grocery and other stores, and had the words “Dragon Collection” and “products of India” on it.
It was not the same type that the U.S. Consumer Product Safety Commission recalled in September, according to its Web site.
The vending machine company could not be reached for comment late Friday afternoon.
But now city health officials have the necklace and are planning to let the public know about the danger of lead poisoning, said Rosalinda DeJesus, York City spokeswoman.