PA 12-135—sHB 5421

Finance, Revenue and Bonding Committee

Judiciary Committee


SUMMARY: This act (1) makes it a crime to willfully and knowingly sell, purchase, install, transfer, or possess an automated sales suppression device (i. e. , “zapper”) or “phantom-ware” and (2) subjects violators to a fine of up to $100,000, one to five years in prison, or both.

Violators also (1) are liable for all taxes, penalties, and interest due as a result of the crime and (2) forfeit all profits associated with the sale or use of the zapper or phantom-ware. The act classifies zappers and phantom-ware as contraband, allowing the Department of Revenue Services commissioner to confiscate them and any devices on which they are installed.

EFFECTIVE DATE: July 1, 2012


Under the act, an “automated sales suppression device” or “zapper” is a software program that falsifies electronic cash register and other point-of-sale system electronic records, including transaction data (e. g. , items purchased, price and taxability of each item, and amount tendered and returned) and transaction reports. It can be carried on a memory stick or removable compact disc and accessed through an internet link or other means. “Transaction reports” are those (1) printed on cash register tape at the end of a day or shift that include sales, taxes collected, media totals, and discount voids at an electronic cash register or (2) stored electronically that document every action at an electronic cash register.

“Phantom-ware” is a hidden programming option embedded in or hardwired into an electronic cash register, whether preinstalled or installed later, which may be used to (1) create a virtual second till or (2) eliminate or manipulate sales records, that may or may not be digitally preserved, to represent the true or manipulated record of electronic cash register transactions.

OLR Tracking: RP: JR: PF: ts: eh