Phia's privacy scandal: AI shopping tool exposed user data (2026). A popular AI shopping assistant, Phia, has been exposed for its invasive data collection practices, sparking a privacy scandal. But here's where it gets controversial: the company, co-founded by Bill Gates' daughter, Phoebe Gates, was quietly gathering more than just fashion preferences. Security researchers reveal a shocking breach of trust. The browser extension, designed to simplify price comparisons, was found to capture a staggering amount of user data. In an older version, it transmitted snapshots of every web page visited, including sensitive sites like banks and private emails, even when users weren't shopping. This raises the question: is any online activity truly private? Phia, fresh from an $8 million seed round backed by Silicon Valley's elite, was named one of TIME's Best Inventions of 2025. But this success story has a dark twist. An ex-Meta engineer, Maahir Sharma, discovered the extension's intrusive behavior, noticing excessive data requests while testing on Amazon. And this is the part most people miss: it wasn't just retail data being collected. Sharma found that the extension logged every URL visited, a potential goldmine for reconstructing browsing histories. It went further, secretly copying entire web pages and sending them to Phia's servers. This hidden function, 'logCompleteHTMLtoGCS,' was a privacy nightmare, replicating and packaging every page a user loaded without their knowledge or consent. Upon testing with a digital bank, Sharma was shocked to find this activity logged as well. His findings were independently verified, and Phia removed the feature after being contacted. However, they didn't disclose the privacy violation or the fate of the transmitted data. Experts argue that these practices violate Phia's own privacy policy and may breach regulations like GDPR. The company claims it only logs URLs anonymously, but researchers counter that even URLs can carry sensitive data. The debate rages on: is Phia's data collection ethical, and are users truly informed? The controversy highlights the risks of rapid AI development. 'Vibe-coding' and AI browsers are accelerating software creation, but at what cost? As AI assistants become ubiquitous, are we sacrificing security and privacy? Share your thoughts: is the convenience worth the potential dangers? References. Top Articles Article information Last Updated: 2026-08-13T15:39:13+07:00 Views: 6295 Rating: 4.3 / 5 (44 voted) Name: Aracelis Kilback Birthday: 1994-11-22 Address: Apt. 895 30151 Green Plain, Lake Mariela, RI 98141 Phone: +5992291857476 Job: Legal Officer Hobby: LARPing, role-playing games, Slacklining, Reading, Inline skating, Brazilian jiu-jitsu, Dance Introduction: My name is Aracelis Kilback, I am a nice, gentle, agreeable, joyous, attractive, combative, gifted person who loves writing and wants to share my knowledge and understanding with you.

Bill Gates' daughter knew for months that her app claimed sales it didn't drive, report claims. "whatever we can do to keep these cookies dropping will be amazing thank you," Gates' co-founder allegedly texted an engineer. By Ece Yildirim Published August 12, 2026, 6:34 pm ET Reading time 3 minutes A Bloomberg investigation published last month claimed that Phia, a shopping startup co-founded by billionaire Microsoft co-founder Bill Gates' daughter Phoebe Gates and her Stanford roommate Sophia Kianni, had been engaging in a shady online practice. The report alleged that the startup's web extension, which purports to find cheaper deals and discount codes for online shoppers, had been falsely claiming sales it did not actually drive via a practice called cookie stuffing, which violates digital platforms' policies. The startup makes money by collecting a commission from retailers for every sale that it facilitates, which it verifies by dropping a cookie on the shopper's browser every time a purchase intentionally involves their extension. Independent testing by Bloomberg, researcher Ben Edelman, and rival company Capital One Shopping claims to have found that Phia's app secretly opens a background tab to inject its own affiliate code, overriding other referrals to get the commission. Similar accusations also befell PayPal-owned Honey back in 2024, leading to a class-action lawsuit. On July 8th, Phia representatives characterized the incident as a software bug and told Bloomberg that the team had just been made aware of the issue and that it was immediately resolved "within the last 24 hours." But now, a new investigation by Bloomberg alleges that Phia executives, and specifically Phoebe Gates, were not just well aware of the situation at least seven months before the publication of the report, but also allegedly actively pushed for the inclusion of the features. Bloomberg is reporting that the issue was not due to a bug but an actual controllable feature named "enable coupon auto drop" on the internal dashboard. Citing internal Slack chats and anonymous sources, Bloomberg claims that Gates had a Slack conversation with some staffers in December and allegedly wanted to verify that Phia was dropping cookies on all websites, even if the shopper did not end up using their coupon. The report also claims that Phia employed other controversial practices, namely one feature that included dropping a cookie automatically every two hours if a user had ever interacted with Phia's extension on a "top 1000 website." The other alleged controversial practice involved dropping cookies if the shopper clicked literally anywhere after Phia's pop-up appeared on the page, even if that click was just the user trying to close the pop-up box. According to the internal communications as presented by Bloomberg, an engineer tried to tell co-founder Kianni that the practice could be "against compliance," but Kianni allegedly responded with a Slack message that said, "I guess we could say that the user is trying to open us and roll it back if they complain." The engineer then allegedly responded by saying they didn't need to implement this feature because the existing feature dropping cookies automatically every two hours was already "working pretty good," to which Kianni reportedly replied with "That makes sense yeah I just whatever we can do to keep these cookies dropping will be amazing thank you." The report also claims that after the "coupon auto drop" feature was disabled last month, Phia's revenue plunged from $80,000 to between $10,000 and $28,000, citing an internal revenue chart. Phia denied the allegations to Bloomberg, including that the revenue decline they suffered last month was solely due to the reversal of cookie stuffing. They also reportedly said that the company would hire a head of compliance "to make sure something like this never happens again." The Bloomberg allegations dropped smack dab in the middle of Phia's meteoric success story. The startup and its co-founders had swiftly generated intense hype online after the company's founding, raising more than $40 million from notable venture capital firms and famous names like Khloe Kardashian, Sydney Sweeney, Hailey Bieber and girlboss/Meta's former COO Sheryl Sandberg. Gates and Kianni also both made the Forbes 30 under 30 list earlier this year, which the internet likes to jokingly refer to as a curse considering that a comical number of its honorees have later been accused of fraud. If the Bloomberg reports are accurate, then the curse might have claimed yet another set of eager entrepreneurs as victims.

Phia, the shopping startup co-founded by Phoebe Gates and Sophia Kianni, faces fresh scrutiny over alleged deceptive business practices. New Bloomberg reporting reveals Gates and Kianni knew about cookie stuffing—claiming commission for affiliate purchases they didn't generate—as early as December, contradicting their earlier claims of only learning about it when Bloomberg enquired. Leaked Slack messages show the founders discussing the practice with executives and engineers. Cookie stuffing reportedly comprised a significant portion of Phia's sales, with daily revenue dropping substantially after cessation. Affected retailers include Nike and Nordstrom. Previously described as a bug, the feature was actually purposefully built and could be toggled on and off. The startup has lost nearly half its full-time employees since year-start and previously faced criticism for secretly collecting extensive user data.