diff --git a/lee/state_machine/src/privacy_preserving_transaction/circuit/tests.rs b/lee/state_machine/src/privacy_preserving_transaction/circuit/tests.rs
index ac9db51b..34f3cede 100644
--- a/lee/state_machine/src/privacy_preserving_transaction/circuit/tests.rs
+++ b/lee/state_machine/src/privacy_preserving_transaction/circuit/tests.rs
@@ -60,7 +60,7 @@ fn prove_privacy_preserving_execution_circuit_public_and_private_pre_accounts()
 
     let recipient_account_id =
         AccountId::for_regular_private_account(&recipient_keys.npk(), &recipient_keys.vpk(), 0);
-    let recipient = AccountWithMetadata::new(Account::default(), false, recipient_account_id);
+    let recipient = AccountWithMetadata::new(Account::default(), true, recipient_account_id);
 
     let balance_to_move: u128 = 37;
 
@@ -144,7 +144,7 @@ fn prove_privacy_preserving_execution_circuit_fully_private() {
 
     let recipient_account_id =
         AccountId::for_regular_private_account(&recipient_keys.npk(), &recipient_keys.vpk(), 0);
-    let recipient = AccountWithMetadata::new(Account::default(), false, recipient_account_id);
+    let recipient = AccountWithMetadata::new(Account::default(), true, recipient_account_id);
     let balance_to_move: u128 = 37;
 
     let mut commitment_set = CommitmentSet::with_capacity(2);
@@ -247,7 +247,7 @@ fn circuit_fails_when_chained_validity_windows_have_empty_intersection() {
     let account_keys = test_private_account_keys_1();
     let pre = AccountWithMetadata::new(
         Account::default(),
-        false,
+        true,
         AccountId::for_regular_private_account(&account_keys.npk(), &account_keys.vpk(), 0),
     );
 
@@ -422,7 +422,7 @@ fn private_pda_withdraw() {
 /// Shared regular private account: receives funds via `authenticated_transfer` directly,
 /// no custom program needed. This demonstrates the non-PDA shared account flow where
 /// keys are derived from GMS via `derive_keys_for_shared_account`. The shared account
-/// uses the standard unauthorized private account path and works with auth-transfer's
+/// uses the standard foreign private account path and works with auth-transfer's
 /// transfer path like any other private account.
 #[test]
 fn shared_account_receives_via_simple_transfer() {
@@ -443,9 +443,9 @@ fn shared_account_receives_via_simple_transfer() {
         sender_id,
     );
 
-    // Recipient: shared private account (new, unauthorized)
+    // Recipient: shared private account (new, foreign)
     let shared_account_id = AccountId::from((&shared_npk, &shared_keys.vpk(), shared_identifier));
-    let recipient = AccountWithMetadata::new(Account::default(), false, shared_account_id);
+    let recipient = AccountWithMetadata::new(Account::default(), true, shared_account_id);
 
     let balance_to_move: u128 = 100;
     let instruction = Program::serialize_instruction(balance_to_move).unwrap();
@@ -510,7 +510,7 @@ fn private_authorized_init_encrypts_regular_kind_with_identifier() {
 /// `PrivateForeignInit` with a non-default identifier produces a ciphertext that decrypts
 /// to `PrivateAccountKind::Regular` carrying the correct identifier.
 #[test]
-fn private_unauthorized_init_encrypts_regular_kind_with_identifier() {
+fn private_foreign_init_encrypts_regular_kind_with_identifier() {
     let program = crate::test_methods::claimer();
     let keys = test_private_account_keys_1();
     let identifier: u128 = 99;
@@ -521,7 +521,7 @@ fn private_unauthorized_init_encrypts_regular_kind_with_identifier() {
         &Nonce::private_account_nonce_init(&recipient_id),
     );
     let ssk = SharedSecretKey::encapsulate_deterministic(&keys.vpk(), &esk).0;
-    let recipient = AccountWithMetadata::new(Account::default(), false, recipient_id);
+    let recipient = AccountWithMetadata::new(Account::default(), true, recipient_id);
 
     let (output, _) = execute_and_prove(
         vec![recipient],
diff --git a/lee/state_machine/src/state/tests/circuit.rs b/lee/state_machine/src/state/tests/circuit.rs
index 4875c76a..160b033c 100644
--- a/lee/state_machine/src/state/tests/circuit.rs
+++ b/lee/state_machine/src/state/tests/circuit.rs
@@ -49,7 +49,7 @@ fn circuit_fails_if_invalid_auth_keys_are_provided() {
     );
     let private_account_2 = AccountWithMetadata::new(
         Account::default(),
-        false,
+        true,
         (&recipient_keys.npk(), &recipient_keys.vpk(), 0),
     );
 
@@ -102,7 +102,7 @@ fn circuit_should_fail_if_new_private_account_with_non_default_balance_is_provid
             balance: 1,
             ..Account::default()
         },
-        false,
+        true,
         (&recipient_keys.npk(), &recipient_keys.vpk(), 0),
     );
 
@@ -151,7 +151,7 @@ fn circuit_should_fail_if_new_private_account_with_non_default_program_owner_is_
             program_owner: [0, 1, 2, 3, 4, 5, 6, 7],
             ..Account::default()
         },
-        false,
+        true,
         (&recipient_keys.npk(), &recipient_keys.vpk(), 0),
     );
 
@@ -200,7 +200,7 @@ fn circuit_should_fail_if_new_private_account_with_non_default_data_is_provided(
             data: b"hola mundo".to_vec().try_into().unwrap(),
             ..Account::default()
         },
-        false,
+        true,
         (&recipient_keys.npk(), &recipient_keys.vpk(), 0),
     );
 
@@ -249,7 +249,7 @@ fn circuit_should_fail_if_new_private_account_with_non_default_nonce_is_provided
             nonce: Nonce(0xdead_beef),
             ..Account::default()
         },
-        false,
+        true,
         (&recipient_keys.npk(), &recipient_keys.vpk(), 0),
     );
 
@@ -279,7 +279,7 @@ fn circuit_should_fail_if_new_private_account_with_non_default_nonce_is_provided
 }
 
 #[test]
-fn circuit_should_fail_if_new_private_account_is_provided_with_default_values_but_marked_as_authorized()
+fn circuit_should_fail_if_new_private_account_is_provided_with_default_values_but_marked_as_unauthorized()
  {
     let program = crate::test_methods::simple_balance_transfer();
     let sender_keys = test_private_account_keys_1();
@@ -295,8 +295,8 @@ fn circuit_should_fail_if_new_private_account_is_provided_with_default_values_bu
     );
     let private_account_2 = AccountWithMetadata::new(
         Account::default(),
-        // This should be set to false in normal circumstances
-        true,
+        // This should be set to true in normal circumstances
+        false,
         (&recipient_keys.npk(), &recipient_keys.vpk(), 0),
     );
 
@@ -773,7 +773,7 @@ fn private_unauthorized_uninitialized_account_can_still_be_claimed() {
     // remains allowed.
     let unauthorized_account = AccountWithMetadata::new(
         Account::default(),
-        false,
+        true,
         (&private_keys.npk(), &private_keys.vpk(), 0),
     );
 
diff --git a/lee/state_machine/src/state/tests/mod.rs b/lee/state_machine/src/state/tests/mod.rs
index 1d6b87a2..76a8db7d 100644
--- a/lee/state_machine/src/state/tests/mod.rs
+++ b/lee/state_machine/src/state/tests/mod.rs
@@ -269,7 +269,7 @@ fn shielded_balance_transfer_for_tests(
 
     let recipient = AccountWithMetadata::new(
         Account::default(),
-        false,
+        true,
         (&recipient_keys.npk(), &recipient_keys.vpk(), 0),
     );
 
@@ -319,7 +319,7 @@ fn private_balance_transfer_for_tests(
     );
     let recipient_pre = AccountWithMetadata::new(
         Account::default(),
-        false,
+        true,
         (&recipient_keys.npk(), &recipient_keys.vpk(), 0),
     );
 
diff --git a/lee/state_machine/src/state/tests/validity_window.rs b/lee/state_machine/src/state/tests/validity_window.rs
index 4581aa89..7e314bc2 100644
--- a/lee/state_machine/src/state/tests/validity_window.rs
+++ b/lee/state_machine/src/state/tests/validity_window.rs
@@ -126,7 +126,7 @@ fn validity_window_works_in_privacy_preserving_transactions(
     let account_keys = test_private_account_keys_1();
     let pre = AccountWithMetadata::new(
         Account::default(),
-        false,
+        true,
         (&account_keys.npk(), &account_keys.vpk(), 0),
     );
     let mut state = V03State::new().with_test_programs();
@@ -191,7 +191,7 @@ fn timestamp_validity_window_works_in_privacy_preserving_transactions(
     let account_keys = test_private_account_keys_1();
     let pre = AccountWithMetadata::new(
         Account::default(),
-        false,
+        true,
         (&account_keys.npk(), &account_keys.vpk(), 0),
     );
     let mut state = V03State::new().with_test_programs();