Phia, the artificial intelligence shopping application co-founded by Phoebe Gates, is facing allegations of deceptive business practices.
The startup is accused of employing a technique known as "cookie-dropping" to improperly attribute sales and inflate affiliate commissions, according to reports from Bloomberg News.
The allegations center on the app's use of aggressive tracking methods that allegedly allow it to claim commissions on purchases that users made without using the platform's links.
This practice, often referred to in the affiliate marketing industry as cookie stuffing or cookie dropping, involves placing tracking cookies on a user's device without their knowledge or consent, thereby enabling the app to take credit for sales it did not facilitate.
The controversy comes at a critical juncture for Phia, which has positioned itself as a tool for helping consumers find deals and earn cashback.
If the allegations are substantiated, the startup could face significant regulatory scrutiny and reputational damage, potentially undermining its user base and partnerships with major retailers.