A salesman sold cash register software that allowed business bosses to cheat on their taxes.

John Yin, 66, appeared before the US district court in Seattle to plead guilty to wire fraud and conspiracy to defraud Uncle Sam. He faces up to 25 years behind bars and must cough up $3,445,589 to the authorities.

Yin, of Everett, Washington, made his living selling point-of-sale systems from Profitek, a Canadian firm with affiliates in China. While the sales terminals themselves were one part of Yin's business, he also sold a piece of software for them called Zapper, which deletes a percentage of cash sales from the register so businesses can pocket the proceeds untaxed.

"This defendant sold businesses a high tech tool that had only one purpose – to give businesses a leg up by cheating the taxman," said US Attorney Annette Hayes on Friday.

"In addition, by not paying their fair share of taxes, they cheated state and federal programs and victimized workers whose employment and social security taxes went unpaid as well."

Conventional sales till software creates an automatic register of all transactions for tax purposes, but Zapper effectively allows two sets of books to be kept, the actual one and the revised books that hide some or all cash transactions.

Eight restaurants in the Seattle area were found to be using Yin's tax-evasion software and have underpaid their taxes by between $145,000 and $910,000 between 2010 and 2013. One restaurateur is accused of dodging $395,000 in sales tax and is facing two years in prison if found guilty.

"Revenue Suppression Software represents the modern iteration of old-fashioned skimming," said Special Agent Darrell Waldon of the IRS's criminal investigation unit.

"The IRS has always pursued those who attempt to circumvent their tax obligations, and this case is no exception. These so-called Zapper programs have caught the eye of diligent IRS Special Agents and our law enforcement partners, and together we will continue to prosecute those who threaten the integrity and equity of our nation's tax system."

The US Department of Justice said it believed the Zapper software was developed by or for Profitek, and that more arrests may follow. Profitek did not respond to requests for comments.

Yin will be sentenced on February 24 by district judge Richard Jones. The crook has already agreed to pay nearly $3.5m in restitution, as well as the prosecution's costs. ®

PS: The OECD warned some years ago that dodgy cash register software could be used to dodge taxes.