>>To put it more precisely, he had probable cause to believe that she had drugs, assuming the facts reported are correct.
If just being in the same general area as someone who is caught with drugs (which is what the report says happened here) is considered probable cause, we have gone a lot farther down the slope than I feared. Especially considering that it occured near a popular tourist destination like Niagara Falls. If I am at a ballgame and somebody a few rows away has drugs do the cops have the right to detain and investigate (read strip search, other humiliating methods) me?
There's more to the report than that. It states that at first, the agent merely called over the three women who were nearby, and two of them immediately scampered off. The one who was left hesitated, and then began to flee as well. Logic, at this point, would strongly suggest that the two women who ran were almost definitely involved in the operation, and that therefore, given the circumstances, it's more likely than not (i.e., probable cause) that the third was also involved.
Even then, it's not a given that she would have been intensively searched. It's most likely that the agent just wanted to ask her some questions. If she then checked out, they may very likely would have let her pass with only the standard searches.