How to Make Payments and Bank Anonymously

Make and Receive Payments Without Using your Name

Young woman at cafe using credit card for online transaction
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Privacy is hard to come by these days. Every detail about you is in a database somewhere, and hackers constantly try to steal that information. Any time you make a purchase or send a payment, your name appears and may be stored along with other details about the transaction. Your mobile phone might even be responsible for sharing information about your location and shopping habits.

What if you don’t want everybody to know who you are and how you spend?

Perhaps you want to donate to a charity or buy medical supplies – and you’d rather keep those transactions to yourself. It is possible enjoy some privacy if you have the right accounts set up. It takes a bit of work (and it doesn’t mean you can do anything illegal), but there’s no need to go off-the-grid and live in a cash-only world.

Desire for Privacy

There are several reasons that you might want to keep your accounts private.

Privacy: for whatever reason, you might prefer to bank (more or less) anonymously. Perhaps you just won the lottery, and you’ve heard horror stories about winners getting hounded by long-lost acquaintances and con artists. Or you might be a public figure (whether you're a global celebrity or a local personality), and you don't like the idea of everybody knowing your business.

Giving and payments: along similar lines, you might want to give money away without the recipient knowing where it came from.

You might also prefer to make payments without others seeing where you spend your money – whether you’re buying things for yourself or paying expenses for somebody else.

Keeping a low profile: if you have significant assets, you might not want to broadcast that fact – especially if it makes you a more attractive target for lawsuits.

In a worst-case scenario, you might even find yourself in a kidnapping and ransom situation.

Estate transfer: perhaps you’re less concerned about your privacy and more concerned about somebody else’s. If you want your assets to pass to a person or organization without the whole world knowing about it (and avoid probate), you need to make arrangements ahead of time.

Separate Entity

So, what can you do to keep your assets and payments private?

The easiest approach is to ask trusted advisors for ideas. Especially if you're well-to-do, “Family offices” in your area might do the trick with local connections and a discreet staff. Outsourcing to an experienced firm requires the least amount of involvement on your part – but you’ll need to do some research to ensure that you’re working with trustworthy people.

You can also take matters into your own hands. However, you’ll need to at least have a local attorney review your plans before you pull the trigger. This article and others like it are not legal advice, are not personalized, and do not contain the level of detail you need before making important decisions.

One approach is to create an entity that owns your assets. For example, a trust or limited liability company (LLC) can hold assets like cash, automobiles, real estate, and business interests.

Those entities can also make payments – without your name being directly linked to the payments.

Somebody will know that you are linked to the entity, but you can choose who those people (or organizations) are. To use a simple example, the bank will need to know who you are if you want to make deposits and withdrawals using the entity's account. In a more complex setup, you can select others (such as an attorney that you trust) to manage the entity and assets for you.

Assuming you hire reputable and trustworthy representatives, those individuals will not be anonymous. For example, their names will be on file at the bank or the Secretary of State's office, and they can be "found" if necessary (Secretary of State files might even be available to the public). Therefore, if your entity is involved with anything shady, those individuals can be compelled (through legal action) to give up your identity.

So, what kinds of entities can you use? Again, only an attorney familiar with your situation and state laws can tell you, but we can give you some food for thought.

Trusts can help keep assets out of your name, and therefore out of the public sphere. Trusts might be best for personal assets like cash and real estate, but you might find them useful in other ways. An increasingly common example is a lottery winner who uses the trust to claim his or her winnings.

LLCs are another option, especially if you run a business, but personal assets can also go into an LLC. New Mexico LLCs in particular make it easy to stay anonymous – your name won’t necessarily appear in public records, but you will need to hire a registered agent with offices in the state of New Mexico.

Complete Anonymity?

Note that all of the examples above are completely legal. If you want anonymous bank accounts for working around “grey areas” or illegal activities (like laundering money, evading taxes, or defrauding a spouse), this page will not be helpful. In today's world, there is no legitimate way to bank with true anonymity. There are products and services out there that promise anonymity, but those services generally require breaking the law or putting trust in somebody who is willing to bend the rules.

In addition to legal issues, there are practical challenges to complete anonymity. If you buy something online or receive payments into these accounts, what mailing address will you use? Will you need to enter your zip code to pay with a debit or credit card? It's not terribly difficult to keep your name out of the spotlight, but it is difficult to be invisible.

Gift cards are your best bet if you want to make an attempt at anonymity in the United States. When purchased with cash, there's no paper trail linking the card to your identity (but if you intend to break the law, security cameras and other tools can help law enforcement find you). However, these cards are only effective for relatively small dollar amounts. Prepaid debit cards with higher limits require that you provide identification information to the bank.

Increased Fraud Risk

If you decide to set up bank accounts for any of the entities listed above, keep a close eye on those accounts. You're probably accustomed to the protection you get in consumer accounts (if your account is drained due to fraud, the bank might cover all of the losses). With other types of accounts, including trust and business accounts, you're responsible for losses.

Alternatives

This page assumes that you want to use mainstream banking products. Checks, debit cards, and credit cards are (for better or worse) subject to government regulation and consumer protection laws – you know what to expect, and you are protected from certain risks. They might also be the only forms of payment accepted. However, there are alternatives out there (Bitcoin, among others). Those options can also offer anonymity if used properly, but they can be risky.