The Honey/PayPal Scam
Introduction
This briefing summarizes findings from two independent investigations into the Honey browser extension, now owned by PayPal, conducted by YouTube channels Mega Lag and an anonymous creator. The investigations reveal deceptive practices, affiliate fraud, and potentially illegal behavior by Honey, resulting in financial losses for consumers, content creators, and merchants. The central claim is that Honey is not a genuine tool for finding the best deals but a mechanism for siphoning affiliate commissions and controlling discount codes for profit.
Key Findings & Themes
Affiliate Commission Theft
Honey is accused of stealing affiliate commissions from content creators promoting products through affiliate links. Key tactics include:
Cookie Replacement: Honey replaces original affiliate cookies with its own when users click on links, taking credit for sales without consumer knowledge.
"Last Click" Exploitation: Honey positions itself as the last click before checkout, ensuring it receives the affiliate commission, often popping up even when it has no coupons to offer.
Honey Gold/PayPal Rewards Deception: Users are led to believe they earn rewards through Honey Gold, but the actual rewards are minimal compared to the commissions taken by Honey.
False Claims and Deceptive Marketing
Honey is accused of making false claims about its ability to find the best coupons:
Controlled Coupon Codes: Honey partners with stores to control the coupons shared, often withholding better deals.
Withheld Discounts: Stores can dictate which coupons Honey shares, resulting in consumers missing out on better savings.
Advertising Lies: Honey's marketing promotes the false narrative that it always finds the best deals, misleading consumers.
Impact on Content Creators
Millions in Lost Commissions
Honey's practices have allegedly cost content creators millions in lost commissions. Many influencers who promoted Honey now express regret for unknowingly supporting a company that was stealing from them.
Impact on Consumers
False Sense of Security
Consumers mistakenly believe that if Honey doesn't provide a coupon, none exists. They are often sold lower-value coupons curated by Honey.
Data Collection
The investigation also alleges that Honey engages in the illegal collection of personal data and coercive practices.
LMG/Linus Tech Tips Involvement
Initial Ignorance
Linus Tech Tips promoted Honey for years before realizing the scam. Their delayed recognition highlights the deceptive nature of Honey's practices.
Silent Exit
After ending their partnership with Honey, LMG chose not to publicly disclose the issues, which disappointed many.
Partnership with Competitor
After dropping Honey, LMG partnered with Karma, another browser extension that employs similar tactics.
Honey's Defense
Honey claims that if its extension is activated and is the last program used while shopping, it will likely receive credit for purchases, seemingly admitting to its last-click strategy.
Potential Legal Ramifications
Investigators suggest Honey's actions could lead to a class action lawsuit against PayPal, labeling the behavior as fraudulent and unethical.
Conclusion
The investigations reveal that Honey operates with significant deception, stealing affiliate commissions and manipulating coupon codes while misleading consumers. The scale of the scam, especially under PayPal’s ownership, has generated strong backlash. The ongoing investigations are essential for raising awareness and holding Honey accountable for its actions.
This document highlights key issues, while the original videos provide further context and examples.
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