You can put in fake info as long as it looks real - consider using info from the white pages as a guide. You can theoretically get a domain seized if you use fake whois info but I have never heard of this actually happening. It's best to use domain privacy in addition to using fake whois info if you're doing dodgy shit.
Bear in mind that if you're doing something really nasty, the domain registrar still has your real info, credit card details etc and will probably reply to law enforcement request.