Phia faces allegations of affiliate fraud over alleged cookie stuffing practices

Phia, a shopping startup co-founded by Phoebe Gates and Sophia Kianni, is under investigation for alleged ‘cookie stuffing’ practices that may have allowed the company to claim commissions for sales it did not generate. A Bloomberg report alleges that Phia injected its referral codes into users’ shopping sessions, overriding other affiliates’ codes to take credit for purchases made through its platform. This practice, which has led to Phia’s suspension from Impact.com, mirrors tactics previously used by Honey, which faces an ongoing class-action lawsuit. The startup, which raised over $40 million in funding and has celebrity investors like Khloé Kardashian and Hailey Bieber, operates an app that helps users find discounted items across retailers. While Phia claims fixes were implemented, retailers and partners remain skeptical. The controversy highlights broader issues in affiliate marketing, where competing platforms often engage in similar practices to maximize commissions. The case underscores the need for transparency in digital commerce and the challenges of regulating affiliate networks.