The Lodestone of Command was crafted long ago by a dwarven smith that worked alongside a mighty enchanter. Together, the weapons and armor they forged were powerful tools of war. It didn't take long for their works to become famous and a power-hungry king made the duo into his slaves, forcing them to work day and night to craft war tools for his army.
While under constant vigilant watch it would be impossible for them to craft their way out so-to-speak. That is, until they devised to plot their escape within this small, unassuming stone that could be worked on in the shadows right under the very noses of the guards.
The item itself is a small black stone made of magnetite that is about the size of a robin's egg. It is set within a thick 30" copper chain. The stone itself has natural magnetic properties, hence the copper chain that allows it to hang freely around the wearer's neck. This assumes, of course, that it is not hidden behind an iron or steel breastplate in which case it will become a small annoyance to the wearer. It is also worth noting that a wearer that is trying to keep this item concealed will need to be wary of his or her surroundings for obvious reasons. This item is not going to cause an eating utensil to come flying towards their heart, but leaning over a workbench full of armor may cause and audible "clink" followed by an awkward hand gesture to un-stick the stone.
The Lodestone of Command, although unassuming in appearance, is a very powerful magical item. It grants the wearer mind control of nearby intelligent humanoids. It takes some practice to get used to its powers at first but a seasoned user will be able to dominate the thoughts of those nearby.
Users will find it much easier, at first, to read into the thoughts of those that are of the same race as they. With time and practice, the user can begin to not only see the thoughts of those around, but will be able to implant a thought of their choosing that should provoke an uncontrolled reaction. I.E make them think they are smelling something delicious to provoke hunger. Or make them think they are seeing a ghost to provoke fear.
Ultimately, the grandest use of this stone is to be able to completely control the thought process of an individual to force them to do exactly what the user wishes. This takes extreme focus on the part of even the most seasoned of wearers and will most likely only be able to be sustained for a few minutes. Though, a lot can be accomplished in a few minutes.
This is clearly a very powerful item and at the suggestion of a comment I will explain in this section how it could be incorporated into your game without it becoming overpowered, for both the GM and a player.
First we'll jump into how you can successfully use this item as a GM. In the uses section my term 'nearby' is a little vague. Think along the lines of "within earshot of a normal speaking voice." In other words, an NPC would need to be able to see the player up-close and personal and be within speaking distance. Limiting the use of this item to only being able to plant a thought into a PCs mind could be one way to do it without actually governing their action. The PC will then be able to make the decision of whether or not they should act on it. (Some players will not want to go along with this while others most certainly will.)
Another way of making this work would be to ONLY take control of a PC during combat AND out of their turn. Meaning the PC takes their turn, then when it is the NPC's turn, they could provoke an attack or other action from the PC that would count as the NPC's turn as opposed to making the player 'skip' their turn. There could also be a way for the PCs to resist the control of the Lodestone of Command by whatever stat in your game governs willpower or the like.
Here are a few suggestions as far as limitations for successful use when and if a player should obtain this item. Reading the minds of NPCs could be fun and useful to players. Who wouldn't want to know what the hot barmaid thought of him? And just as with players, NPCs could resist with willpower. The more opposing or otherwise ridiculous action a player is trying to get out of an NPC could result in a higher bonus to the resistance roll. For example if a player wants an NPC to be distracted by something he thought he heard such as a bird flying into a window would have a lower resistance roll as opposed to a player explaining to an NPC that "these aren't the droids he's looking for."
Just as with a GM using the item, it could be limited to combat for a player as well. The player could use the lodestone on an Orc and force it to attack its commander, providing the Orc fails its willpower check. Another good limitation for a player with this item would be to make it very, very exhausting to use it to its full potential. So after a player uses such a powerful mind control ability with the lodestone, they could feel nauseated for a short while and not be able to perform that action again until they get a full 6 hours rest (or equivalent depending on racial abilities.)
A bonus to adding a willpower check to either the PC or NPC would be that more powerful PCs and likewise more powerful NPCs would be exceedingly more difficult to control. As far as a duration on the effect, it could possibly depend of the severity of the action. To make a grumbling NPC whistle a happy tune could last for 30 seconds to a minute, while making the banker open the vault for you might not last long enough for her to turn the key before she comes to her senses.