[stale2002]

Thats why you use something like TrueCrypt to provide plausible deniability.

You have 1 partition/password with the stuff you actually want to hide, and you have a second password/partition that just contains your porn collection.

"Yes officer, I just use encryption to hide this stuff. Nothing illegal here. It is just embarrassing. Thats why I hide it."

Thats really good plausible deniability.

[alkonaut]

Or "This 500gb file is just a garbage file of random numbers I keep because I heard harddrives last longer if they aren't empty".

In any reasonable legislation there shouldn't be a difference between not providing a password and not admitting you have anything encrypted at all (because no one can prove the difference anyway).

An important thing that is often forgotten is that most many aren't challenged for encrypted contents in criminal cases but civil lawsuits where the burden of proof is (also) on the defendant because there is no "beyond reasonable doubt" . In that situation, the mere existence of e.g. a file transfer log with the movie file name + an encrypted disk is enough to end up with massive damages. In that situation you would be very interested to show your unencrypted data if you don't have the file in question.