I was all settled in for a sordid tale of intrigue or some yarn about a clever heist. I could spin a few of those stories myself.
But, of all the things this guy picked on, it's that his traffic is searching for discount codes and coming back with an affiliate tag? This is not a scam. It's perfectly legal and anyone wading into affiliate marketing should do his research and understand how it works. It's not just activating a magical digital sales force. Like any other marketing, it needs to be understood, researched, and applied to the business properly (or decided that it is not a good fit for the business).
The first tell-tale sign is that he didn't even know who his affiliates were. He just blindly flipped the switch. He could (and clearly should) have hand-picked his affiliates and worked with them to cultivate the activity he desired. It's ridiculous to blindly open the flood gates and complain about what comes floating in, then declare the whole affiliate marketing space one tremendous scam.
Even now, this is so easily fixable and could really be used to his advantage. His customers are telling him exactly what they want. He also knows where they are going to search for discounts. One supremely simple step would be to start creating and marketing the codes himself to his current customers. Let them know that the best codes are sent to their appreciated customers. Another step would be to cull his affiliate partner list to those where his users (and presumably others like them) are actually going to find his codes. He should also start by working with his account manager on the network (assuming he sprung for one) to devise a strategy around his goals. For instance, on all major networks, he can explicitly indicate that his affiliates cannot engage in keyword bidding or search engine marketing.
There's not enough space here to get into it. I understand his frustration, but he is being irresponsible and reckless in making the generalized statements he's making.