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Not just law enforcement and private enterprises like banks rely on hidden cameras; so do many high-net-worth families. It is common for numerous surveillance cameras to be positioned throughout the homes of the wealthy in both visible and concealed locations. The devices eavesdrop on the humdrum of ordinary life to ferret out evidence of potential and actual crimes.

The shorthand for the equipment is the "gotcha cam," as they are hidden inside teddy bears, wall outlets and clocks. Manufacturers of the gear are increasingly creative, embedding the pinhole cameras in wall outlets and even in pens and chewing gum dispensers. For good reason, too.

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Tread carefully

A quick search on the Internet unearths hundreds of examples where hidden surveillance cameras in the home caught unsuspecting perpetrators in the act of committing a crime, resulting in their arrest and conviction. Just knowing there are cameras surreptitiously recording the surroundings may dissuade potential offenders.

Nevertheless, there are disconcerting legal consequences for the improper use of the cameras. To learn more about the subject, I reached out to attorney Jack McCalmon, founder and CEO of The McCalmon Group, Inc. The Tulsa, Oklahoma-based firm assists companies and high-net-worth families in reducing the risk of employment practices liability.

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"Depending on where they are or what they are doing, a person can have a reasonable expectation to privacy, which affects the use of hidden surveillance cameras," Jack told me. "In some cases, the wrongful use of the cameras can result in costly litigation and criminal penalties. There are issues over where the camera is placed and whether or not it records audio. One must tread very carefully."

Legal parameters and ramifications

Where a high-net-worth family resides in the United States is a factor in the legal use of surveillance cameras inside or outside the home. Different states have different laws on the subject. In many states, for instance, it is illegal to audiotape a conversation, unless both parties being recorded have previously provided their consent. Federal law also takes this posture. In other states, one-party consent to covert audio recordings is required.

Even if the audio recording indicates the occurrence of a crime in the home, the evidence will not be admissible in court. If the homeowner releases the content of the audio to the public, he or she is exposed to an invasion of privacy lawsuit brought by the recorded person.

"Most 'gotcha cams' don't have audio anyway, which is good; but if they do and you want to use it, make sure to have an attorney write up an acknowledgement and consent agreement and have domestic staff and anyone else being recorded sign it at the time of the recording,” Jack advised. “Otherwise, skip the audio portion."

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Reasonable expectation of privacy in bath & bedrooms

Where the camera is located in the home also invites legal ramifications. Secreting it in a bathroom is against the law, as this is a place where people have a reasonable expectation of privacy. The same policy applies to the bedroom of a live-in nanny or other domestic employees.

Throughout the rest of the home, every U.S. state permits the use of hidden cameras, even without the consent of those being recorded. Outside the home, surveillance cameras also can be mounted legally to record activities within the perimeter of the private property and even beyond it in the public sphere. "A best practice is to have a legitimate safety or security concern or some reasonable suspicion of wrongdoing being conducted outside the home before installing a hidden camera," he said. "For instance, if you are missing garden equipment and you suspect an employee is taking it, you’d have firmer legal ground to stand on in case you were sued."

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The same principle applies within the home. If the homeowner suspects a domestic employee is stealing money or jewelry or may be abusing a child, the use of a hidden camera would pass legal muster, in most cases. "Just remember that the expectation of privacy may override a person’s suspicions of wrongdoing," Jack noted. "You'd need to have very strong reasons for the suspicion and you should seek the advice of an attorney."

If the homeowner is found in violation of the law, several states punish the unauthorized use of a surveillance camera as a misdemeanor with a fine. In others states, like Maine, unauthorized use is a felony punishable by possible incarceration. “This is why it’s always a good thing to first contact a lawyer about when, why and where to install hidden cameras,” Jack said.

The recording of visitors

The same rules apply to visitors to the home, from friends and houseguests to contractors and delivery personnel. While their actions can be legally video-recorded within the home, their conversations cannot be audiotaped without their permission.

Unauthorized use of the video recordings also has legal strings. "If a guest comes to a private residence and staggers around drunk, publishing the person’s image could create some exposure, depending on the guest and the situation," said Jack. "However, if the inebriated person is in the street outside the house and falls over, this generally would be considered a public place, where there is no expectation of privacy."

In either case, any guest who shows up plastered should be put in a cab and sent back home, given the homeowner's potential legal liability. Still, Jack's point resonates—all domestic employees and guests should be made aware that there are surveillance cameras inside and outside the house. While their privacy will be carefully guarded, their best behavior is up to them.