This false shuffle appeared in The New Phoenix, No. 346, July 20, 1957, p. 210. David Ben gives a thorough survey of its antecedents and history in Genii, Vol. 71 No. 2, Feb. 2008, p. 62.
An earlier description of the covered unweaving of partially shuffled cards—the principle underlying the Zarrow Shuffle—is found in the anonymously authored Les Misteres du Pharaon Dévoilés, c. 1802; see Lori Pieper's English translation in Gibecière, Vol. 11 No. 2, Summer 2016, p. 104.