Electronic Sales Suppression Software Tax Fraud and State Audits Defense

An electronic sales suppression device, the most common called a “zapper,” is a software program that falsifies the electronic records of point of sale (POS) systems for the purpose of tax evasion. “Phantomware,” and “Dark Clouds” are other ESS devices.

Most jurisdictions levy transaction taxes (sales, value added, or excise taxes). Restaurants, department stores, cinemas, convenience stores, even marijuana dispensaries record their transactions digitally, both for internal controls and tax compliance purposes. There is a dark side to efficiencies brought by technology, and there is a heightened awareness among tax authorities that because digital records are malleable, ESS devices are being used to alter POS records. As a direct result, many jurisdictions are seeing significant audit adjusts based on alleged manipulation of business records. Tax assessments based in ESS are, as a consequence, not traditional tax controversies. The most serious are both criminal and technology-intensive, requiring expertise across multiple legal specialties.

ROBERT CHICOINE LAW defended the first Electronic Sales Suppression prosecution in the United States. We negotiated and drafted the first electronic monitoring agreement in the United States. This statutorily mandated agreement functions as a settlement position allowing a business owner to continue in operation after an ESS assessment. It is a prototype agreement suitable in settlement negotiations in 25 other states with a similar ESS statute.

Richard Ainsworth is the leading expert in fraud applications of tax-technology. Over 30 years of practice he has held corporate (Taxware, ADP, FDC) and academic positions (Harvard Law, BU Law, NYU Law) in tax-technology. He teaches the only graduate law course on Tax Fraud & Tech at NYU Law to wide spectrum of American and foreign lawyers, domestic and international tax officials. His writings in tax technology fraud are widely available on the net. In over 100 articles he has examined fraud and fraud prevention applications of technology.

With estimated losses to ESS exceeding $20 billion in the United States alone, ROBERT CHICOINE LAW is in the forefront of defending clients that have been audited or prosecuted by State, Federal or foreign revenue agencies. Our firm has granular expertise, knowledge, and expertise in ESS. We work with the experts in this evolving field.

Cases We've Handled


  • State of Washington v. Yu Ling Wong. King County Superior Court (Cause No. 16-1-00179-0 SEA). Defended First Electronic Sales Suppression prosecution in the US. Negotiated and drafted the first statutory imposed monitoring agreement in U.S., a prototype for monitoring agreement in 25 other states with similar statute.
  • State of Washington v. Salvador Sahagun, King County Superior Court (Cause No. 18-1-00591-1) & State of Washington v. Salvador Sahagun, Snohomish County Superior Court (Cause No. 18-1-007004-31). Defended the largest retail sales tax and Electronic Sales Suppression prosecution in the history of WA. Resulted in dismissal of all charges against defendant.
  • State of Washington v. Li. Clark County Superior Court (Cause No. 18-1-00594-9). Defended Electronic Sales Suppression prosecution. Resulted in dismissal of all charges against defendant.

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