Yes, it is truthful in most part. A VPN doesn’t hide an IP address. It assigns a different IP address as being that of the connection. An IP address still exists, which is that of the VPN.
It is possible to check if a publicly known VPN is being used. Some IP search websites give information if a public VPN is used. Many VPN IPs are on public registers (‘blacklists’) and can be used to determine if a VPN is being used. It is worth noting that Choice and Moderators use connection information, including if VPNs are used, within this community. This is especially for new member accounts, to check the account is likely to be genuine or not.
This website explains this a bit more:
However, with private VPNs, such as one set up by an organisation for its employees to use for remote access or a home router set up to be a remote access point when away from home, it is difficult to determine if a VPN is used. This is because the IP address will be that assigned to the organisation/household. Such IPs won’t be assigned in registers as being a VPN, but, their purpose of hiding one’s IP address isn’t possible as the organisation/home IP will be visible.
In some countries, such as Russia, China, and North Korea, they actively block VPNs by blocking their IP addresses using IP address registers. A VPN business could try and circumvent these blocks by obtaining more IP addresses registered to their servicers, but, this is only a shot gap solution as any new IPs will be blocked shortly thereafter (‘whack the mole’ scenario).
And is is worth outlining the requirements of the Telecommunications (Interception and Access) Act 1979, namely:
https://www.homeaffairs.gov.au/about-us/our-portfolios/national-security/lawful-access-telecommunications/data-retention-obligations
While a VPN can encrypt your communications, the TIA Act still applies to the underlying telecommunications data. If law enforcement or security agencies obtain a valid warrant, they can access the data, even if it is encrypted by a VPN.
Further to this, it has been found that due to legislative obligations for users of the VPNs, many VPNs collect user data even if they indicate that they don’t collect such data. They say they don’t for marketing purposes, but, this is often misleading. Basic metadata is connected to ensure that it is available for law enforcement agencies when requested, even if the law enforcement agency is in another jurisdiction. This is possible as the reach of law enforcement is further than the borders of the country where it is legislated. Many countries, including Australia, have reciprocal arrangements for the collection and sharing of such data. Where these reciprocal arrangements don’t exist, like some of the countries outlined above, there are other substantial risks of using VPNS located in such countries (such as a foreign government logging one’s internet activities).
With many countries having IP filters, which includes Australia, VPNs will collect metadata information even if they say they don’t so that they aren’t in position that a country blocks their IPs because they fail to meet legislative requirements. This can destroy their business model.
So, one can’t assume that VPNs delivery full privacy on the internet as they don’t. They might hide IPs one is visiting from their internet service provider, but, it doesn’t prevent this data being collected downstream. Often those which are caught using the internet for illegal activities, use VPNs thinking that they guarantee anonymous use of the internet. They only find out the limitations to this belief after they are caught.
VPN use for bypassing geolocating etc is also becoming more limited is also outlined in the article and also the additional link I posted above.
Their main advantage is moving towards providing secure encrypted connections when one is using insecure connection such as a free public WIFI or a connection where the connection could potentially have eavesdropping abilities (such as using a internet connection at work or place of education). But, even with more advanced internet security being adopted in some business sectors (e.g. financial industry), they are blocking access to online accounts when VPNs are used. This is because it is difficult for them to immediately track the source behind the VPN when access is required.
Choice’s article on VPNs is also worth reading as well: