Prey Project is it really safe to use?

I personally don't recommend it: http://www.shrp.me/docs/dont_use_prey.php

It should be fine. Also on their site's FAQ section there is info about this

What about my privacy? What do you guys do with my data?

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Nothing — trust us. And even if you don’t, you can check the source code and make sure that Prey is doing nothing weird in your computer. The info is gathered and the report gets sent directly to its destination.

Now if you’re using the Control Panel you must know that your device’s reports are accessible to you and you only. Not even us can access the reports since each device gets its one unique key which only you have access to. You can also safely delete any reports you want from your devices, no evidence left.

The problem is that I don't think Chris or any of the other credible sources actually looked at the code, they just refer it because other people have. The company that manages the code is based out of Hong Kong and although they say it is open source, not all of the code is made available, they also use a lot of third party binaries from other freeware apps and other sources, so not even they can vouch that the code is safe. The code is written in shell scripts that run with root access, there are some concerns there, it is not compiled code and some of the authentication is a little dodgy. Maybe you can see the source code on the client, but you don't know what they are doing on the server end of things.

It's called PREY. I wouldn't trust it.

It's also called PREY. Even the name sounds a little suspicious. There is only one way to keep it safe out there kids, and that's by NOT installing anything you aren't sure of.