The Swearing 7 Year Old

So I have a problem. Zach, my seven year old son, has taken to saying the "F" word in front of small children. Most recently it was at my cousin's house on Easter. Nothing like a good four letter word to end the brunch in a hurry. Lindsay's three year old daughter Lyla was playing "Memory" with my boys. Zach turned over a duck (not a match) and said "Duck - fuck."
Now don't get me wrong, under other circumstances I might have chuckled at this little faux pas, but only a few short weeks before we were playing bridge at our friends' house and he called Alex an "F-er." We'd had a long talk about how it's embarrassing and inappropriate and made him apologize to our hosts, went home and lectured some more (thanks dad - you really helped me master the art of beating a dead horse)...and we figured the F bomb had hit its last target for a while, right?
WRONG!
SO what do you do? I realize my inclination to ask what the fuck is wrong with him might have been on the wrong track, but really, how do I emphasize that it's really not okay? Taking away video games seemed to work its magic the first time, but apparently that punishment was only effective until it was forgotten (Oh, say, five minutes after it had ended)...so I am now just sitting here wondering when that ugly word is going to rear its head again.
Suggestions for effective punishments that don't spark the notice of Social Services are greatly appreciated.