Is It Possible to Hide From the Privacy Invasion?

I’m spending the week on Maryland’s Eastern Shore for a family reunion in honor of our own Bob Bauman, who decided to convene us in our old stomping grounds on the shores of the Chesapeake Bay. That means lots of steamed crabs, boating and swimming on the river, and lightning bugs at dusk.

It also means looking up old friends from my days on the Shore, where I went to elementary and high school in the 1970s and ‘80s. In the old days, that would have meant detective work — nose in a phone book, a round of phone calls to third-degree contacts, maybe a visit to the deeds office, gradually narrowing down the field until I located my targets.

In today’s world, it’s a lot faster and easier … just a couple of clicks on the Internet and I know everything I want to know about my old pals … and in some cases, things I didn’t.

That got me thinking … is it possible to hide in plain sight with today’s digital privacy invasion? Yes … if you take the right steps.

Privacy invasion – The Need for an Alter Ego

It’s entirely possible to create an alter ego for your personal identity — a “dead end” for anyone trying to find you. The recent American invasion of privacy shows why it’s increasingly important to do so.

Alleged Chinese hackers stole the electronic identities of 18 million Americans recently … a number that is expected to grow as more information surfaces. Nobody knows what they were looking for — compromising information for blackmail purposes? Government security clearances? Whatever they wanted, they didn’t have to work too hard to find it. This invasion of privacy was quite simple.

The federal government’s Office of Personnel Management — basically, Uncle Sam’s human resources department — retains electronic records on every federal employee, past and present, as well as on their family members, in cases where security clearances are involved. These records are stored on big data servers employing (evidently) antiquated database and security technology. The Chinese hack wasn’t the first one … apparently the Russians have done the same thing.

This blatant invasion of privacy included basics like Social Security numbers, addresses, telephone numbers, financial, business and educational histories, and similar details. In hundreds of thousands of cases, it also included the replies to detailed questionnaires covering intensely personal background information related to security clearance applications.

One way to avoid having your personal information scattered to the four corners of the globe is to avoid anything to do with federal employment … or any other major institution, for that matter, public or private. That’s rarely possible. None of us can avoid the growing invasion of privacy entirely — but there are things you can do to build a firewall between what’s public and what you want to keep private.

Privacy invasion – A Legal Persona

Thanks to the self-interested creativity of late-medieval merchants in places like Genoa and Amsterdam, our legal system includes the concept of a “juristic person.” That’s the technical term for any corporation that exists separately from the people who own it. It applies to corporations big — think Microsoft or General Electric — to small — the limited liability companies (LLCs) commonly used by self-employed businesspeople like construction contractors.

The fundamental feature of the corporation is a legal “veil” between the corporation and its owners. If a handyman’s truck runs over my foot, and that truck is legally owned by an LLC, the most I can get in a lawsuit is the net worth of the LLC (and even that might be difficult). The handyman’s personal assets are off-limits because of the doctrine of limited liability.

But an LLC doesn’t have to be a business per se. You can form an LLC for any reason — to own your house, your car, or any other asset. An LLC can sign up for telephone or internet service, have a mailing address, open bank accounts, buy other companies, take or make loans, open credit cards … almost anything a real persona can do.

Hiding in Plain Sight from the privacy invasion

The LLC creates a highly useful “life hack” for avoiding the growing privacy invasion.

Let’s say that you once lived and worked in the open, but now you’d like some privacy. All you have to do is spend a few hundred dollars to create an LLC in a state that doesn’t require the owner’s identity to be listed in the public records — like Delaware, Nevada and Wyoming — and you can vest ownership of many of your assets in it. Your phone, internet service, and all your utilities can be in the name of the LLC. So can your home’s title deed, mortgage and anything else that could connect to you. Your credit cards, online shopping accounts, and other data commonly used to track people can be in the name of the LLC as well.

Adopting this strategy won’t give you 100% immunity to the invasion of privacy — nothing will. But it will fulfill the basic goal of all asset protection strategies … to make you so hard to find that 99% of adversaries will give up and move on to another target.

So go ahead … do your own private disappearing act and avoid the American invasion of privacy.

Kind regards,

Ted Baumann
Offshore and Asset Protection Editor

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