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I am a freelance, at-home, software developer and I have a client whose work requires me to log in remotely to a machine sitting on their local network to test the software. They gave me access via Windows Remote Desktop, but in order to get it to work I was forced to install Dell SonicWall NetExtender to create a VPN.

After installation, it disturbingly created its own place on my wifi list:

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This makes it look as though (to me) my internet traffic is being channeled through the VPN. So my client will be able to see all of my personal computing traffic (if that's the case).

Question 1: Am I paranoid? What privacy risks come with VPN? Reading this question makes me think I'm not so paranoid: https://security.stackexchange.com/questions/11382/what-are-the-pros-and-cons-of-a-vpn-for-privacy -- although this question was mostly regarding the outside world seeing your data. I am equally concerned with my client seeing my data (which is why I think this question relates to this SE site particularly). Not that I don't trust them or have anything to hide, but I'd still prefer keeping my private life private.

Question 2: What measures can I take, if any, to seclude the VPN so that it only sees the traffic created by the RDP? I was thinking if I created a virtual machine that could work, or will it?

Question 3: I didn't have the greatest feeling that their network techs were working the problem very well. Is it really necessary to VPN to create a secure RDP session? Could a more competent tech achieve this without the need for VPN? Is there something I should suggest to them to avoid the VPN requirement?

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To check if your internet traffic is going over the VPN Google 'What is my IP'. Then connect to the VPN and do the same search again. If your public IP address changes when you connect to the VPN your internet traffic is going via the VPN, if it doesn't change then it isn't.

Using a VPN for this is a perfectly good solution IMO.

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Any traffic over sent through the VPN will be encrypted with the VPN but can be viewed if necessary through the Dell Sonicwall (physical device) via log files. Disconnect from the VPN when you're not working on work related stuff, it's that simple. It creates a virtual interface for your LAN connection but it doesn't listen on there unless you connect.

It is completely necessary for RDP because RDP requires a "safe" connection between two hosts. You can't send traffic from your computer to your work's internal IP address anyways without it.

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