Buying anonymously
Nathan Taylor shows you how to keep your identity safe when purchasing online.
Last month we talked about “burner identities” and some of the ways you can keep your personal information out of the hands of potentially dodgy sites and services. As you might expect, maintaining that anonymity when engaging in financial transactions is somewhat harder. It’s not impossible, however, and this month we’re going to look at some of the ways you can make online purchases without giving out excessive – or any – personal information.
Obviously in some instances complete anonymity is impossible. If you’re getting physical goods delivered you’ll need to provide a valid address, for example. Even then, however, there are steps you can take to keep your financial details, at least, private.
PayPal
Pros: Widely accepted, hides credit card details.
Cons: Difficult to hide full identity.
One of the simpler and widely accepted tools you can use is an online payment system like PayPal. These generally do not provide any kind of anonymity other than financial. When you make an online purchase with PayPal, for example, the recipient will see the email address and name you used to register the PayPal account. It’s difficult to create a ‘dummy’ PayPal account with fake details, since PayPal requires that you register a valid credit card or bank account with it as a payment method.
What PayPal will do, however, is keep your credit card details safe. It essentially serves as an intermediary – PayPal will make the payment on your behalf, then you pay PayPal. That way, the company you’re buying from never gets to see your credit card details; only PayPal does. PayPal also provides purchase protection much like credit cards do: merchants that use PayPal are required to sign an agreement to provide chargeback-style refunds if PayPal determines that the transaction was not completed properly.
Prepaid debit and gift cards
Pros: Accepted at most places where credit cards are, gift cards can be purchased completely anonymously.
Cons: Purchase cost, some sites will reject them, can be left with unusable money .
A variety of financial services now offer prepaid debit and gift cards that link to a limited Mastercard or Visa account. These have two possible advantages – there’s a hard limit on how much money can be stolen from you at once if your card details are compromised; and it may be possible to purchase them completely anonymously, so that the card is never linked to your identity.
There are two types of cards you can get: a rechargeable prepaid card and a gift card, which can only be used until the money runs out and is then discarded. For anonymity, gift cards make the better option – rechargeable cards might have your name attached to them and you’ll likely have to register your details with the card provider in order to provide a recharge method.
One good option in Australia is the Australia Post Gift Card by Mastercard (see auspost.com.au/ money-insurance/prepaid-cards), which can be purchased in most AusPost outlets, with cash or any other payment method. The card costs $5.95 to buy and can be loaded with up to $500. It will not have a name or identity attached to it – the name on the card will simply be “Gift Cardholder”.
The gift card should work at most places that accept Mastercard. However, some sites might reject them, especially for recurring payments like subscriptions. In
addition, gift cards often have the downside of ending up with a small amount of money left over that you can’t spend, since any purchase for which you don’t have sufficient funds left on the card will simply be rejected by Mastercard, and not many online stores allow you to ‘split the bill’ into multiple payment methods. If you have a small amount left on the gift card, you can try taking it to a physical store: many friendly physical stores will let you make partial payment for a purchase with the gift card and then make up the difference with cash or another payment method.
Disposable virtual credit cards
Pros: Can very quickly and easily generate a new temporary credit card number .
Cons: Still have to trust your financial details to a third party, some require subscriptions to be able to create.
Along the lines of the prepaid and gift cards, virtual credit cards are a way to create ‘burner’ credit and debit cards that can be used for purchases and then discarded. The difference is right there in the name: a virtual credit card is purely digital – a number you can use to make online purchases, but can’t be taken into physical stores.
In most instances, you have to sign up to a service like Revolut ( www.revolut.com), NetSpend ( www.netspend.com) or ecoPayz ( www.ecopayz.com). These services then allow you to generate temporary virtual credit cards that will work wherever Visa or Mastercard are accepted. They’re useful for signing up for free trials that demand you provide a credit card number, or for purchasing from sites that don’t seem entirely on the up and up.
Cryptocurrencies
Pros: Can be completely anonymous.
Cons: Not widely accepted, can be challenging to get started, wildly fluctuating value.
If you want true anonymity when purchasing, then nothing beats cryptocurrencies. Bitcoin and other cryptocurrencies are now accepted by some merchants for digital and physical purchases, and it’s entirely possible to make a purchase without giving a single element of your identity to anyone.
The way it typically works with Bitcoin is this: you first create a Bitcoin wallet. Wallets are anonymous – there’s no name or other details attached to them. Then you purchase Bitcoins from a Bitcoin exchange and have them sent to your wallet. Then, when you try and buy from a store with Bitcoin, the merchant will provide you with a Bitcoin wallet ID and/or QR code to transfer the Bitcoins to, the number of coins to transfer (which will be based on the current exchange rate) and a time limit in which to send those funds.
Then you use your Bitcoin wallet to send the funds to the designated address.
Now this may seem complicated at first – and it is a little – but it can very quickly become second nature once you’ve got the process down.
The real challenge is initially setting up your own Bitcoin wallet. There’s a deep, deep rabbit hole of different options and methods when setting up a Bitcoin wallet. For beginners, we recommend a simple mobile app like BRD (formerly Breadwallet) or the Coinbase app, which are both available on Android and iOS.
You can also look for a physical Bitcoin wallet, a small fob-like device that adds an extra level of security since the Bitcoins stored on it can only be accessed when it’s plugged in or connected via Bluetooth/NFC. You still make transactions using your mobile or PC, but you need the wallet device to be there in order for the transaction to work.
Some of the most popular options include Ledger ( www. ledger.com) and Trezor ( trezor.io) devices, which are simple to get started with and won’t break the bank.
You can purchase coins for your wallet ahead of time or as-needed – though we often recommend the latter to avoid the effects of wildly fluctuating coin values. Then, once you’re set up with a cryptocurrency payment system, you’ll have the ability to make completely anonymous purchases and avoid giving out any part of your identity to those you transact with.