In a shocking exposé that has sent ripples through the tech and creator economy, PayPal's popular browser extension Honey stands accused of orchestrating what critics are calling "the biggest influencer marketing scam of all time." The scandal, uncovered by YouTuber MegaLag in December 2024, reveals alleged systematic fraud that may have cost content creators millions in lost revenue while potentially misleading millions of consumers.

The Sweet Facade Turns Sour

Honey, boasting 19 million Chrome users, marketed itself as a consumer's best friend – automatically finding and applying the best discount codes during online shopping. However, MegaLag's investigation suggests the extension was operating a sophisticated scheme that allegedly:

• Deliberately withheld better discount codes in favor of less valuable ones

• Hijacked affiliate marketing commissions from content creators

• Manipulated last-click attribution to redirect commissions to itself

• Colluded with retailers to control which discounts users could access

Red Flags and Early Warnings

Gaming icon Markiplier emerges as an early skeptic, having declined Honey sponsorships in 2020 due to concerns about the company's business model. "Where did they get millions to spend on influencer marketing partnerships?" he questioned, noting that a business built on saving consumers money shouldn't have such extensive marketing budgets.

Linus Tech Tips, another major tech influencer, terminated their partnership with Honey in 2022, citing concerns about the extension's handling of affiliate links. However, this early warning didn't prevent numerous high-profile creators – including MrBeast, Emma Chamberlain, and Marques Brownlee – from promoting the service.

The Mechanics of Deception

According to MegaLag's investigation, Honey's alleged scheme operated on multiple fronts. Even when creators' endorsements led to purchases, the extension would reportedly manipulate the attribution system to steal commission credits – sometimes returning mere pennies to users through its rewards program while pocketing substantially larger commissions.

PayPal's response has been limited. Josh Criscoe, a PayPal representative, told The Verge that the extension "follows industry rules and practices, including last-click attribution." The company has yet to address allegations about restricted access to coupon codes.

Broader Implications

The scandal raises serious questions about the largely unregulated landscape of influencer marketing. As creator Hank Green noted in response to the revelations: "How responsible should creators be for understanding the business models of the companies that they do brand deals for?"

MegaLag promises more revelations about "an even darker side to PayPal's scam" in an upcoming video, suggesting this story may have only scratched the surface of a much larger controversy.

The Honey scandal serves as a watershed moment for the creator economy, highlighting the urgent need for greater transparency and due diligence in influencer marketing partnerships. As this story continues to develop, it may reshape how creators and platforms approach sponsored content deals in the future.