So here is a quote from a Neil Gaiman short story, “Keepsakes and Treasures” (p. 117 in Fragile Things):
So Neil Gaiman’s a fantasy author, and this is obviously for narrative effect, but I’m curious as to what extent this could actually happen. If you are very, very wealthy - let’s say in the multi-billionaire league - is it possible to keep it completely secret? Especially if you want to use your money, since I could see maybe a very miserly multi-billionaire keeping it hidden away, but what about someone who wants to fill their house with expensive art and wear designer suits? Could it happen? How?
I think it would be possible. You could be a minority stakeholder in a privately held, multi-billion dollar company. No documents need to be filed for shareholders and your name need not show up on any “CEO/board member” lists. A silent silent partner.
I doubt you could be one of the richest people in the world this way, but I’d guess you could come close.
There just aren’t any privately-held companies that big. Consider something like Cargill, which is one of the largest privately held companies in the world. If it were publicly traded it would be within the Fortune 20.
So take a publicly traded corporation of similar size, say JP Morgan Chase. Its current market capitalization is $136.13 billion. The SEC requires anyone with more than 5% equity to be named. So that means you could own 4.9% of $136.13 billion = $5.45 billion and remain anonymous.
That’s small potatoes. Warren Buffett’s shoeshine boy makes more than that in tips.
… And of course in a privately held company, you could own a larger share, but your wealth will still not approach that of the richest known people in the world.
Not long ago, Forbes (?) had their list of the richest people on earth and surprisingly, a good many of them had no photo or a photo that was decades old. In other words, you never see them and they are never at events where photos are taken. Many were kids of “old money” wealthy people whose parents had kept them out of the limelight.
I would bet that Warren Buffett could probably stand in a line at the DMV and not a sole would recognize him. Most would think he was just some old dude waiting to get his rusty truck tags renewed.
I have met lots of really rich folks, and most of them blend in crowds quite well and you would never guess they have more money in their checking account than you will earn in a lifetime.
But Forbes knew about them, right? In Gaiman’s story, the ten richest people on Earth don’t appear in top 10 lists like Forbes. How does Forbes know? Could you keep Forbes out of the loop?
Forbes has admitted it doesn’t report on the wealth of the Forbes family. So they could choose to not report on other wealthy individuals as well without publicizing that policy.
The problem is that the money has to come from somewhere. You can’t get a billion dollars on the sly.
The most obscure superwealthy are probably the Mars family, since Mars candy is still privately held. Most of the photo-less Forbes listers are Mars heirs. So maybe if one of them left their Mars share to a non-family member and then died, you could have a completely unknown superwealthy. You’d have to pay a lot of taxes, though, so the government would know who you were.
It’s a common fictional trope and it’s a bit silly.
You can stay low profile, but you really can’t be a secret gazillionaire if someone really wants to track you down. The main problem is that if you are going to be hyper-rich you have to have some way to access and control that wealth or by definition you are not rich. That legal or operational control/power has to have some formal legal declarations of its presence somewhere.
If those declarations (in some form) are not present how will you access your wealth?
I can think of a couple of things to make it harder than usual for people to find out your wealth. For one (although this doesn’t apply to a lot of people), sometimes when people such as Congressmen have to report the finances, they are allowed to report ranges, rather than a specific amount. For instance, occasionally you’ll see a news report that “Senator X has a net worth of $50-150 million.”
A more common thing would be to take advantage of some states’ laws that are fairly permissive about things like corporate structure. I believe that all states require a registered agent, but the agent doesn’t necessarily need to actually have any thing to do with the corporation. You can pay a third party to be the agent. In addition, you can used a nested series of corporations, one owning another one, which owns another one, etc. You wouldn’t actually technically own all those assets, but you would control them, which in many cases amounts to much the same thing.
I don’t remember now where or when I read it, but I’m fairly sure that I once saw a Forbes article in which they came right out and said that one guy hid his assets so well that their estimate of his net worth was basically just a guess.
In the new show “Person of Interest” one of the main characters is a software industry billionaire that no one has ever heard of…he met another engineer at MIT and made that guy the “front man” for his software empire. The “front man” essentially became a Bill Gates sort of figure in that fictional world, whereas the silent partner is totally unknown.
It never gets into the nitty gritty of how this was done, but it’s basically suggested the “silent-silent partner” has many, many different fully established secret identities. Most likely all of his holdings are divided up into many different difficult to trace holding companies and etc.
Would this ever happen in real life? I doubt it. But I think from a “what is possible” standpoint, that approach is possible. However the premise relied on the secret partner being like “super-software engineer” someone so good that his unique genius was the entire reason for his company’s massive success. That along with their personal friendship is the only reason the front man would have to keep such a secret. Real life geniuses like that are rare or non-existent, and reliable friends aren’t always that common either when you’re talking about money in the billions of dollars.
For reasons further never explained, the secretive character was secretive before ever starting this big software company. So he knew from day one he never wanted his name getting associated with it, so most likely when him and his friend set it up they gave a batch of holding companies and whatnot shares in the corporation, each holding company probably controlled by one of the many false identities this guy had set up (you wouldn’t have them all tied to the same identity or regulators would probably be able to discern that one guy had a substantial controlling interest in the company who was undocumented.)
A good friend of mine is a multi-millionaire. Not as wealthy as questioned in the OP, but worth somewhere around $8-10 million.
And unless he told you, you would never know it. Lives in an average apartment, drives an average car, dresses like a college kid (he’s mid-40s).
About the only clue, if you meet him and talk to him a bit, is that he doesn’t have a job. He doesn’t do anything really. Just lives off the income from his holdings. He’s not miserly, just lives like an average guy.
Not in secret from banks and the IRS perhaps, but certainly inconspicuously.
A friend of my grandparents lived in a house like ours drove a regular car, dressed modestly, and so forth. When he passed on he left an astonishing bequest to our church, and also provided quite generously for his children and grandchildren.
I then learned that he had held patents on some machine parts integral to manufacturing pretty much everything in the 50s, 60s, and 70s.
My richest friend is the same way. I think he’s worth 7 million. He owns a nice condo in a highrise in Denver, but an average person could rent the same thing (and it really didn’t cost him much at the time he bought it). He drives an old Pathfinder.
He’s pretty generous though. He invited us all out to the NCAA basketball playoffs at the Pepsi Center in his luxury suite and after the fact told us that it was all on him.
The guy who started the company that made him his money is worth 70 million and you wouldn’t know it by talking to him.