Phia co-founders Phoebe Gates and Sophia Kianni were aware of the shopping app’s cookie stuffing scheme for at least seven months starting in December 2025, according to a Bloomberg investigation published August 11, 2026, contradicting earlier claims that the practice was a bug discovered only after the company was contacted by reporters.
Cookie stuffing is a deceptive affiliate marketing tactic in which tracking cookies are secretly placed on a user’s browser without their knowledge, allowing a fraudster to claim credit for sales they did not drive. In Phia’s case, the browser extension would open a hidden tab during checkout and inject its own affiliate code, overriding referral links from other marketers and retailers, and potentially capturing commissions it had not earned.
Bloomberg’s reporting, based on leaked internal Slack messages and sources familiar with the matter, shows that Gates and Kianni discussed the practice with other executives and engineers. The leaked messages indicate the founders pushed for the features that enabled cookie stuffing. When the practice was first reported in July 2026, Phia’s spokesperson told Bloomberg the company was only made aware of the issue when reporters reached out. The company later described it as a coding glitch, but the new evidence suggests it was a deliberately built feature that could be switched on and off.
The scale of the practice was significant. Cookie stuffing accounted for a substantial portion of Phia’s reported sales, and Bloomberg found that the company experienced a sizable drop in daily revenue once it stopped using the mechanism. The affected retailers included major brands such as Nike and Nordstrom.
The Honey precedent reveals the legal and reputational stakes. PayPal’s Honey browser extension faced identical allegations in December 2024, when YouTuber MegaLag exposed the extension for allegedly hijacking affiliate links from content creators. Honey is now the subject of an ongoing class action lawsuit. PayPal has secured multiple court victories in the litigation, with the most recent dismissal occurring in November 2025, but the case remains active. The Honey scandal resulted in the extension losing over 4 million users by mid-2025, according to reports, and Google subsequently updated its Chrome Web Store policies to ban similar practices.
Phia launched in April 2025 with the promise of being a more effective Google Flights-style platform for shopping, helping users find the lowest prices across retailers and discount codes. The startup raised over $43 million and attracted high-profile investors including Khloé Kardashian and Hailey Bieber. In July 2026, after Bloomberg’s initial investigation, Phia was suspended from Impact.com, a leading affiliate and influencer marketing platform. The company has since said it removed the features causing misattribution on July 7, and stated it would issue transaction reversals to affected brand partners and hire a head of compliance.
The revelation adds to a pattern of challenges for Phia. In July 2026, shortly after the cookie stuffing investigation, Puck reported that Phia had lost nearly half its full-time staff since the start of the year, that several brands were unaware they were listed on the app, and that investors had concerns about the company’s aggressive affiliate marketing model. The startup has also faced prior controversy over secretly collecting sensitive user data, including tracking behavior across the web.
Sources
- Bloomberg — Reported that Phia co-founders Phoebe Gates and Sophia Kianni pushed for cookie stuffing features and were aware of the practice for at least seven months starting in December 2025, based on internal Slack messages and sources.
- TechCrunch — Covered the Bloomberg investigation and provided details on the company’s response, including the statement that features were removed on July 7 and that the company would issue transaction reversals.
- The Verge — Documented PayPal’s Honey browser extension cookie stuffing allegations, the December 2024 exposure by YouTuber MegaLag, and the ongoing class action litigation.
- Chargebacks911 — Explained cookie stuffing as a form of affiliate fraud where cookies from an unrelated website are used to falsely claim credit for sales.
