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Restaurant Owners Use Zapper To Cook the Books

Hugh Pickens passes along a NYTimes report on software programs called "zappers," which allow even technologically illiterate restaurant and store owners to siphon cash from computer cash registers to cheat tax officials. In the old days, restaurant owners who wanted to cheat kept two sets of books. But because cash registers make automated records, hiding the theft requires getting into the machine's memory and changing that record. "...the Canadian province of Quebec may be the world leader in prosecuting zapper cases. Since 1997, zappers have figured in more than 230 investigations, according to the tax collecting body Revenu Québec... In making 713 searches of merchants, Revenu Québec found 31 zapper programs that worked on 13 cash register systems. Only two known zapper cases have been prosecuted in the United States... The cash register security industry is focused on protecting patrons and owners from theft by employees, which may be one reason so few zappers are uncovered in the United States. No one hires security experts to protect the government from devious businesses... As hard as zapper software is to detect, it is easy to make, said Jeff Moss, organizer of the annual hacker convention Def Con. 'If it runs on a Windows system and you are a competent Windows administrator, you can do it,' he said."

5 of 454 comments (clear)

  1. My Favorite Way of Stealimg From Myself by Anonymous Coward · · Score: 5, Interesting

    Many vendors would issue rebate checks in teh business name if you purchased certain quantities of food and supplies. These rebates never appeared on the invoices.

    I would substitute the checks for cash in the daily deposit. Everything balanced and essentially undetectable.

    I also would void large guest checks as if I was giving a refund and "refund" the cash to my pocket..

    I would "comp" meals to complete strangers and pocket the money.

    And I always ate well and never reimbursed my business for it.

    If I sold inventory to another restaurant, the money went into my pocket.

    So nothing to see here. Move along. Plenty of ways to steal without some damn "zapper". The secret is to never be greedy; greedy people get caught.

  2. This is news in the US? Really? by Anonymous Coward · · Score: 5, Interesting

    In my old country - Brazil - the cash register vendor had, as part of their pitch, the section about how at the end of the day you would flip a switch in the machine and it would invent a whole new day of sales for you up to a specified amount.

    I worked on a restaurant that, when closing, would have the manager moving the register to some back room and generating a new day of sales.

    This came from the manufacturer. It was not an add-on. And it was easy to do, the manager only had to flip the switch, punch in the amount for the day, and let it rip.

    This manufacturer was one big american company that was purchased by a bigger company and then spun off with the same name.

    The registers, BTW, were pre-audited by the government team - which clearly wasn't savvy enough to find the switch or had been properly compensated for their blindness.

    I'm surprised that anyone is surprised... Though I agree that it is wrong.

  3. Re:Yeah, and we should be surprised of this becaus by kesuki · · Score: 5, Interesting

    "Study economics and current events, particularly Zimbabwe"

    fixed that for you, weimar germany only printed massive amounts of money to repay war repartitions. modern Zimbabwe is printing massive amounts of 100 billion dollar bills to fund and supply their army which is in a protracted civil war with 2 large militia groups as a result of the African war in the Congo.

    what happened in germany is minor compared to what Zimbabwe is doing, which is printing money, buying foreign currency and funding their entire army with foreign currencies. that would be like america going out printing 300 trillion dollars, buying euros, yen, etc from banks around the world and then 'using' that foreign non hyper inflated currency to repay the national debt. (yes i realize the national debt is only 9.65 trillion, but to get enough foreign currencies from foreign banks, at least 300 trillion us dollars would have to be printed, if not a few hundred quadrillion, it would be hard to sucker over banks, after the first few large cash transfers they'd start devaluing the dollar in proportion to the reported sizes of unexpected cash purchases)

    eventually, if national debt out strips the pace at which our economy grows, the government is going to start using kooky plans to raise the available funds, however, it's pretty clear that we're in no immediate threat of the government pulling any tricks to try and repay debt. a couple lean decades of economic a serious recession, and continued tax cut and spend politics, and America might be in serious trouble finding enough people to buy their debt. for right now though, things aren't critical. although i find the amount of debt, and deficit growth sickening.

  4. Purchases by Paradise+Pete · · Score: 5, Interesting
    When I owned a bar/restaurant in California, one of these would have done no good at all. When the tax guys show up they don't even want to look at your register tapes. They look at your purchases. They see how many bottles you've bought, they know how many drinks you can pour, and they just multiply.

    And since purchases must go through only the very small handful of licensed distributors, there's no hiding it.

    And as for the people who are saying "If you don't skim you can't stay in business," well, maybe you're right. I went broke.

  5. Re:Public goods by nbauman · · Score: 5, Interesting

    As long as taxes remain involuntary,

    This is a bizarre argument (which gives me nostalgic memories of my college freshman all-night bull sessions). But it's important because it gets to the heart of the social contract that we (almost) all agree to, which we recently understand much better because of studies in the evolution of cooperation and in economic experiments in cooperation, like Prisoner's Dilemma. (I recently read a few good articles by Samuel Bowles http://en.wikipedia.org/wiki/Samuel_Bowles_(economist) which is why I'm so interested.

    If taxes were voluntary, they wouldn't be taxes.

    If contributions were voluntary, then freeloaders wouldn't contribute, and would benefit from the contributions of those who do. Cooperation would collapse, and we wouldn't have the advantages of cooperation. We wouldn't have roads, or electricity, or water, or cities.

    I know you believe that they could all be produced by entrepreneurs, but if you look at the history of industrialization, you'd see that governments play a major role. Try to find a country with electricity that wasn't promoted by the government or the colonial power.

    In fact, try to find a country run by free-market libertarian principles. Afghanistan is the closest I can think of right now, but their GNP is nothing to brag about.

    I see no moral problem with people doing whatever they can to avoid paying them.

    That's because you're a selfish freeloader. That's why we need tax laws that are enforced.

    I see no moral problem with robbing from the rich to give to the poor. I think we'd have a more productive economy if we did (look at Finland).

    In fact, I see no moral problem with robbing from the rich to give to me.