Phoebe Gates, the 23-year-old daughter of Microsoft co-founder Bill Gates, is facing scrutiny over allegations that her shopping startup, Phia, used online tracking tools to claim credit for sales it may not have generated.
According to the New York Post, Phia, which Gates co-founded with Stanford alum Sophia Kianni, came under fire in July after reports that its browser extension was placing web "cookies" on customers' devices without necessarily requiring them to use the service to make purchases.
The company initially described the issue as a software problem and said it had only become aware of the matter shortly before removing the features.
A Bloomberg report, however, said internal communications indicated Gates and other executives had known about the practice for months.
The practice, known as "cookie stuffing," can allow an affiliate to claim commissions for purchases it did not actually drive.
Ariel Givner, founder of Givner Law, wrote on X that the practice can be prosecuted as federal wire fraud and potentially carries a maximum sentence of 20 years in prison, along with fines and restitution.
Phia has denied wrongdoing and said it is reviewing transactions connected to the disputed tracking.
A company spokesperson said the features responsible for misattributions were removed July 7 and that Phia had begun reversing affected transactions with brand partners.
The startup operates through a browser extension that helps shoppers find discount codes at online retailers.
When a customer uses a Phia coupon, the company can receive a commission from the retailer after its tracking technology records the transaction.
According to Bloomberg, internal messages indicated some Phia features could place cookies even when shoppers did not use a coupon.
The report said the practice dated back to at least December and involved sales at retailers including Nike, Gap and Nordstrom.
Phia's reported revenue dropped sharply after the features were disabled.
Bloomberg reported that average daily revenue fell from roughly $80,000 to between $10,000 and $28,000, although Phia disputed the characterization and said it had disabled several monetization tools at the same time.
The company raised $30 million in 2025 from investors including Hailey Bieber, Kris Jenner and Spanx founder Sara Blakely.
Phia said it is hiring a head of compliance and reviewing transactions to determine whether additional reversals are necessary.
One affiliate network, Impact.com, had already suspended the company and redirected commissions it had been holding for Phia, according to Bloomberg.
The allegations have put additional attention on Gates' efforts to build a business independently of her billionaire father. She has previously spoken about wanting to establish herself on her own merits and having a "desire to prove myself."