vscode-phpcs: Windows 10 warning for all php files: File appears to be minified and cannot be processed

I am having an issue where all php files opened in my Windows 10 Visual Studio Code IDE produce the following warning:

Full error message:

file: 'file:///c%3A/Users/bravo/VScodeProjects/test-app/src/Controller/AppController.php'
severity: 'Warning'
message: 'File appears to be minified and cannot be processed'
at: '1,1'
source: 'phpcs'

Even this basic file is enough to trigger the warning:

<?php
   print "the line above causes the trigger"

I am running:

• Windows 10
• Visual Studio Code 1.10.2
• PHP 7.1.2 (cli) (built: Feb 14 2017 21:24:49) ( ZTS MSVC14 (Visual C++ 2015) x64 )
• PHP_CodeSniffer version 2.8.1 (stable) by Squiz (http://www.squiz.net)

I am creating this ticket because the warning only seems to occur in the IDE, the warning does not show when running phpcs against the exact same php files on both:

• my Windows machine (same phpcs as used by VSC and your extension)
• my Linux machine

All pointers highly appreciated.