The Zapper Program
The most prevalent method of under-reporting business income is by skimming cash from gross income. This method omits an amount of sales from ever being entered it into the accounting system. Now comes modernization and Revenue Suppression Software (RSS), commonly referred to as a Zapper program. Zappers automatically skim off a set percentage of cash transactions from Point of Sale (POS) systems like the ones used in restaurants.
In late 2016 the U.S. Justice Department announced criminal charges against Jon Yin for selling Zapper programs. He was working as a software salesman for a Canadian company called Profitek. Profitek sold an add-on RSS program that could only be used with its POS software. The Zapper software could only be ordered from a supplier in China.
Yin plead guilty to a scheme estimated at costing federal and state taxing authorities more than $3.4 million in tax revenues. The IRS now trains its revenue agents to test for Zapper software in restaurants and all other cash intensive businesses.