just stop squid, and erase all the files in your cache directory... for example:
squid -k shutdown
rm -fr /var/lib/squid/cache/*
then re-create the swap directory structure:
then start squid again...
PS: you can also run "squid -z" without first deleting the cache files, and AFAIK that way it creates a new directory structure without wiping-out the old one, but i'm not sure if that's what happens as i've never done it...