I didn't know these creepy things existed until last year and now one has moved into my house.  This is an Elf On The Shelf.  It comes with a book too.  I have not read that yet, so I don't know the true story of the Elf.

 I guess you put it in different spots around the house and it watches your children and scares them into being good so they get presents for Christmas.  It was a gift.