How to Be Invisible

BANK ACCOUNTS AND MONEY TRANSFERS

Before a law firm decides to sue, they often turn the case over to a private investigator. First on his list will be to track down all your bank accounts, which he will search for state-by-state. Says a Texas PI who’s read my e-book Invisible Money:

Frankly, if one of your readers follows your instructions to open a no-interest account in a tiny bank in a faraway state, and does not accept a debit, credit, or ATM from that bank, I would not be able to find it. That goes for most other PIs as well—and very few will be more thorough than me!

That is the good news, but there’s bad news to come. Did you know that financial institutions are required by the federal government to spy on their customers? The Bank Secrecy Act, which has been around for a long time, authorizes the Treasury Department to require any financial institution to report any “suspicious transaction relevant to a possible violation of law or regulation.” These reports, called “Suspicious Activity Reports,” are filed with the Treasury Department’s Financial Crimes Enforcement Network (FinCEN). This is done secretly, without your knowledge or consent, any time a financial institution decides that you have done anything “suspicious.”

For example, each deposit, withdrawal, exchange of currency, or other payment transfer that involves a “transaction in currency” (a physical transfer of currency from one person to another) of more than $10,000 will be reported. Reportable currency transactions include:

• Checks or drafts cashed for over $10,000.

• Cash deposits over $10,000.

• Cashier’s checks purchased with cash over $10,000.

• New account opened with more than $10,000 in cash.

• Exchange of currency—small to large or vice versa; foreign to the United States or vice versa.

• Multiple cash transactions totaling more than $10,000 made in one day by or for the same person, if the bank is aware of them.

Does it appear from the above that you could safely purchase a $9,000 bank cashier’s check with cash and still avoid a Suspicious Activity Report? No, because the Bank Secrecy Act also requires all banks to log purchases of any monetary instrument involving currency in the amounts from $3,000 to $10,000, inclusive. (If you happen to own a sports arena, racetrack, amusement park, licensed check-cashing service, vending-machine company, or theater, you may be exempted.)

What about foreign transactions, for an individual?

Again, a report will be made if $10,000 or more is involved, whether or not it involves cash, traveler’s checks, money orders, investment securities, or negotiable instruments in bearer form.

UNINTENDED CONSEQUENCES

The information below is from an article that appeared in the March 24, 2008, Newsweek:

When Congress passed the Patriot Act, law enforcement agencies hailed it as a powerful tool to help track down the confederates of Osama bin Laden. No one expected it would snag the likes of Eliot Spitzer. The odd connection between the anti-terror law and Spitzer’s trysts with call girls illustrates how laws enacted for one purpose often end up being used very differently once they’re on the books.…

The Treasury issued stringent new regulations that required banks themselves to look for unusual transactions and submit SARs—Suspicious Activity Reports—to the government.… One of these leads led to Spitzer … the governor called attention to himself by asking the bank to transfer money in someone else’s name.

And so it was that the Patriot Act unexpectedly brought down the governor of New York—a transfer in someone else’s name. Take care, readers, that it never brings you down.

YOUR PERSONAL BANK ACCOUNT

Any bank account you have in your own name (other than the type mentioned at the start of this chapter), tied in with your Social Security number, can be tracked down by agencies specializing in asset searches for lawyers. This includes Certificates of Deposit as well as IRA accounts.

Robert O’Harrow Jr., from The Washington Post, writes that “… lawyers, debt collectors and private investigators buy the data to help in civil lawsuits, divorces, and other financial matters. Prices range from just over $100 to several thousand dollars for a look at banks nationwide and a report that includes information about stocks, mutual funds, and safe-deposit boxes.” O’Harrow relates the account of a security official at BankBoston “… who noticed an ad for one of the services and anonymously ordered a search on himself. When the report came back, the official, Frederick Tilley, said he learned new details about his own accounts. ‘They came back with the account information, down to the penny,’ said Tilley. ‘There are lots of them and it’s freely advertised.’”

Copies of the individual checks themselves may also be obtained, since all checks are microfilmed front and back. This reveals not only payees and endorsers but also memos (if any) and signatures.

If you are the subject of the search, what will the computers reveal? Do you wish to be identified as one with “deep pockets,” or would you prefer to be considered “judgment-proof,” i.e., with not enough assets worth suing you for?

Or suppose, with no forewarning, you find yourself under investigation by someone who wishes to cause you harm. This could be anyone from an ex-employee to a disgruntled present or former mate. A private detective may come up with information from so far in the past that you had forgotten it was there. Imagine that you are forced via subpoena duces tecum—Latin for “bring with you”—to turn over all bank records for the past three years. Are there any checks, any charges, that you would prefer to remain secret? (Think about this carefully. Consider newsletter subscriptions, contributions, trips, purchases of alcohol, guns, ammunition, or whatever. Consider rentals, from autos to motels to videos.)

Since this book is about privacy measures rather than tax evasion, you need have no secrets from the government. This report is about hiding bank accounts from your enemies, not from the IRS. Some of my suggestions that follow may be offbeat and perhaps underhanded. I agree, but they are not currently nor anticipated to be illegal, according to the attorney who reviews all my projects.

USE A NOMINEE

This method requires the assistance of a proxy or nominee—another person who will act on your behalf. Let’s call this nominee Debbie E. Faith. Debbie will open a bank account in her own name. Here are the steps:

1. Choose an independent bank in a state where neither you nor Debbie lives. This will isolate both of you from routine searches and will hide Debbie’s possible death (should such occur) from the bank authorities long enough for you to cash a final check, closing out all but the last $10 from the account.

2. Prepare Debbie for obvious questions such as, “Since you live in California, why are you opening this account here in Pioche, Nevada?” The answer might be “I’m thinking about moving here within the next three months.” (She should have no problem saying something like that, because she can certainly think about it.…)

3. Withdraw cash from your present account(s), perhaps $1,000. Purchase a bank cashier’s check from a bank where you are not known, made out to Debbie Faith and with a fictitious remitter.

4. Next, Debbie practices, hour after hour, an indecipherable signature, the kind businessmen use all over Europe. She then assembles the necessary identification (a passport is best, if she has one, since it gives far less information than a driver’s license), travels to the city where the bank is located, and opens a personal account, using any legitimate address other than where she actually lives. She will receive a minimum order of checks from the bank that will have her name and address printed in the upper left-hand corner. The checks will be mailed to the address she gave them.

5. When the printed checks arrive, tear out the two checks with the highest numbers (so it appears the account has been used), along with a printed deposit slip. You will need these to order new checks from a mail-order company such as Checks Unlimited (ChecksUnlimited.com) or Checks in the Mail (checksinthemail.com). Use one of the two checks to pay for the order, and mark the other check (sent as a sample) “VOID.” Cross out both the name and address on the sample check, as well as the present number. Write in a starting number of 6001 or higher, so that the account will appear to have been established years ago. Above the deleted name and address, write in Debbie’s initials “DEF.” Choose a type style such as Old English that is difficult to read. Add a note somewhere to emphasize that the checks are to have only the initials. The mail-order check companies will usually mail only to the address printed on the sample check from your bank so it’s best not to ask that they be sent to another address.

6. When the new checks arrive, Debbie sits down and signs them until her signatures start to vary. Time out for coffee or Dr Pepper, then she continues to sign, with breaks, until finished.

7. Last, but far from least, order a rubber stamp with Debbie’s signature.

RUBBER SIGNATURE STAMPS

In theory, an agreement should be made with the bank in advance, before using a rubber stamp, to be able to use one as a signature on checks. In practice, however, banks seldom if ever check signatures on checks for small amounts. For a new account—such as in the example above—I suggest using checks with real signatures for the first month or so. Later, use a rubber stamp for anything below $500. Save the signed checks for times when checks must be written for larger amounts.

Incidentally, I suggest you get a rubber signature stamp for all your accounts, and use it from time to time just to make sure the bank is accepting them. That way you can write checks on your spouse’s account, and vice versa—especially if one of you is traveling and the other is at home. About a year ago, one of my clients (I’ll call him John, and his new wife Jane) followed my advice to get a signature stamp for Jane, who had a bank account in her maiden name that was used to pay utilities. Early this year, Jane had a serious illness and was hospitalized for several weeks. During this time she had worries far more serious than trying to sign checks with what would have been an unrecognizable signature. John, however, got out the stamp and continued to pay the bills in his wife’s absence.

These stamps can be ordered at any office supply store, or online. I recommend Xstamper as one of the best. With this model, don’t just push the top down because that might make the signature stronger on one side. Instead, position it where you want it, and then give it a firm tap in the center with your knuckles. With a few practice tries, it will work perfectly—for your nominee bank account, or for any other!

PRINT YOUR OWN CHECKS

Although I prefer the printed checks that can be ordered by mail, many of my readers say they use their computer and printer to make their own checks. There are a number of products on the market that enable the user to print the name of the account (leaving out the address), the bank information, the check number, and even the special MICR characters that can be printed with magnetic ink. A quick check on the Internet will bring up names such as VersaCheck, MySoftware, MyChecks, MyPersonalCheckWriter, MyBusinessCheckWriter, Checknique, CrossCheck, ChecksByNow, ChecksByNet, Checker, CheckMAN, and CheckMagic. Or, purchase checks at any major office supply store.

OR, NO BANK ACCOUNT AT ALL

Hundreds of thousands of American citizens, as well as a similar number of illegal aliens, manage to live without any bank account at all, and not all are financially disadvantaged. This is one way to ensure that you do not accidentally reveal your home address by writing a check for the rent, the mortgage, utilities, taxes, or home repair.

Worse, there is a real danger if you ever write a check to a lawyer, CPA, or anyone else who—unknown to you—is a crook. When investigating this person—perhaps surreptitiously—government agents will come up with a copy of your check. Might this possibly lead to your mail and bank account being examined? Or a tap on your telephone?

Therefore, you may decide to pay professionals in cash if you’re there in person. If not, you might mail a postal money order, a cashier’s check, or a traveler’s check. For small payments, I recommend the money orders sold in supermarkets, convenience stores, and Walmart. They are economical, can be purchased with no ID, and the line for the payee is left blank. You fill in the payee on your own. The issuing office has no record of the sender or the receiver.

For larger amounts, such as up to $2,500, you may prefer a bank money order or cashier’s check. Many banks do not require ID when you are purchasing the checks with cash. If in doubt, check out a bank beforehand, asking them about their policies. Or, test their policy by purchasing a small check to pay for something you are going to order by mail. If asked for ID, tell the absolute truth: “I didn’t bring any ID with me; I didn’t think I’d need it.”

ANOTHER GOOD REASON TO PAY CASH

Frank Abagnale, in his book The Art of the Steal, says on page 29:

People can get anyone’s check. All they have to do is see it. Criminals nowadays will drive around until they find a ritzy neighborhood with million-dollar homes. They’ll knock on the door. When someone answers, they’ll say, “Boy, you’ve got a lot of leaves lying on your lawn … I’ll tell you what, my buddy and I will clean up your leaves, leave the place immaculate, and it’ll cost you just seventy-five dollars.” The guy thinks it’s a great deal, the crooks clean up the leaves, and the owner pays them with a check for seventy-five dollars. That’s all they came for: the check. Then they go to the Internet and order the checks … forge them, and start cashing them. Next time, the guy will rake his own leaves.

UNTRACEABLE MONEY TRANSFERS

Why not let the U.S. Postal Service move the cash for you? This is the next best way to just handing the cash over in person. As long as the recipient is also in the United States, it is perfectly legal.

HOW TO INVISIBLY TRANSFER $25,000

Obtain fifty business-size (#10) envelopes and the same number of first-class postage stamps. Pick up a magazine with lots of small pictures and price lists in the back. (Photography magazines are ideal.) Into each envelope insert five $100 bills. Wrap them in one page from the magazine. This will weigh fourteen grams, which is just half an ounce. If possible, mail the envelopes from various locations over a period of days or weeks and—if available—to multiple addresses.Remember, use normal first-class mail. Even with the cost of stamps and envelopes, this will not cost you more than $25. (I recommend you not register the envelopes. That might attract too much attention.) I’ve been mailing cash to others in normal envelopes for the past twenty-five years and haven’t lost a dollar yet.

MAILING MONEY OVERSEAS

As long as the destination is Western Europe, there should be little if any problem as regards to safety en route. (Don’t even think of mailing cash to Mexico or to Central or South America.) However, keep in mind the prohibition against sending $10,000 or more out of the country at any one time. Even doing it some days or weeks apart may be considered to be “structuring,” which is also against the law. Now that you know this, make your own decision.

HAWALA BANKING

This is the oldest banking system in existence, used for exchanging money across international borders. Since no money actually moves anywhere, it cannot be traced. Although it is widely practiced among Chinese and Indians (from India), and to a lesser extent by Spaniards, the average American had never heard of it until after 9/11 (Osama bin Laden was said to use this system.)

Suppose you wish to send $25,000 from Vancouver, British Columbia, to a friend in Helsinki, Finland. You would hand $25,000 cash to a Vancouver money changer (Hawaladar) in Vancouver, and receive code words (or an agreed signal such as a secret handshake) and a contact address in Helsinki. No actual cash moves out of Canada. Instead, when your friend gives the code to the correspondent hawaladar in Helsinki, he will receive the equivalent in euros (less a commission) from money that is already there. To review:

• There are no written documents. The exchanges are based on mutual trust (perhaps for that reason unpopular in the United States?).

• Only local currencies are used. Thus, if you are sending money from the UK to Mexico, you pay in pounds and the receiver in Mexico collects in pesos.

• This exchange cannot be traced because no money crosses a border.

The hawala system has been under attack since 9/11 and by the time you read this it may be illegal in many countries. However, it does make for interesting conversations among friends. Beyond that, proceed at your own risk.

HOW NOT TO HAVE A SECRET ACCOUNT REVEALED

Nazita Aminpour and her husband, David, have a joint account at a Chase branch in Kew Gardens, Queens, along with a custodial one for their three children. But Nazita also had a secret bank account of $800,000—money that was apparently hers alone. Unbelievable though it seems, the suit alleges that a bank employee at Chase called David to encourage him to move some of that $800,000 in his wife’s account into other investments with Chase. David knew nothing about that account until the phone call came in.

Here is what Nazita should have done:

1. Used a different bank.

2. Given a ghost address when she opened the account.

3. Listed a secret voice-mail number that only she could access.

Do you have a secret bank account? If so, does the banker have your true address and telephone number? If so, move that account to another bank!

QUESTIONS & ANSWERS

What do you think about credit unions, as opposed to banks?

In answer, I’ll pass along the experience of one of my readers, who, as a college student years ago, worked in the customer service department of “one of the largest banks in the U.S.” His job, as a “call center rep,” was to respond to phone calls and check account data. “Not only did I have access to the customer’s name, address, Social Security number, and date of birth,” he writes, but “I saw every financial transaction on the account, including credit card purchases and ATM withdrawal locations.” According to my reader, there were thousands of call center reps at the bank with this kind of access. “For fun (and because we were low-paid and unethical), we’d check out the accounts of friends, lovers, coworkers, etc. Further, during late-night calls with angry/rude callers, I occasionally heard a rep reminding a caller to cool it, because we knew where they lived. Scary huh?” (Hopefully, of course, your bank has only your ghost address!) Take to heart this warning from one who knows: “Thousands of low-paid workers have access to your personal life and feel no shame in monitoring you. Remember that the next time you open an account at the big bank with the most conveniences. (Note: I joined a small credit union after that experience. I like to think things are a bit different there.)”

What if a bank requires my fingerprint on the back of a check?

I agree that this is an extremely irritating request, but what if your financial circumstances do not give you the option of just walking away? Keep these two points in mind:

1. As long as the check does not bounce, it will disappear into the bank archives forever.

2. If that still worries you, then try this: When you give your thumbprint, press hard and slightly twist your thumb. Practice at home first. The goal is to smear the print just a trace. If done right, this will make a match impossible, and yet the clerk may not notice it at all.

There is also such a thing as filling in the grooves of your thumbprint with glue, then allowing it to dry. Then a second coating is given and while still moist you press it against the thumb of another person. But I don’t think you need to get into all that, unless you are on the FBI’s top ten list. (And if you are, better not to cash that check at all!)

Can I pay cash to a dealer for a new car?

Not unless you are prepared to be quizzed, sign a federal form, and perhaps be reported as “suspicious” to authorities. In fact, I do not recommend ever buying a car from a dealer, new or used. Most if not all will require a photocopy of your driver’s license, and sometimes your Social Security number as well.

Buy your vehicle from a private party, even if you have to travel to another state to do it. You’ll certainly save money over the price of a new one. Most of the vehicles we buy are from original owners, and with 20,000 miles or less. Private parties will happily accept cash with no problem—even if you are paying $20,000 or $30,000 or more.