US says top Chinese fashion brands Shein and Temu mishandled customer data

A top US government body has accused two leading Chinese ecommerce apps of failing to properly secure user data and infringing on intellectual property.

The report (opens in new tab) from the US-China Economic and Security Review Commission (USCC) claims two popular digital platforms – Shein and Temu, pose a risk to US customer data.

Shein comes in for particular criticism, with the report saying it, “requests that users share their data and activity from other apps, including social media, in exchange for discounts and special deals on Shein products.”

Human rights abuse

Shein “has struggled to protect user data”, the report added, apparently referring to a $1.9 million fine imposed by the New York State on its parent company Zoetop in 2022 for failing to secure user credit card data and other personal information.

Data practices aside, the USCC also accuses Shein of failing to prove that the clothes it brings in from the Xinjiang region weren’t a product of forced labor, something that’s mandatory for businesses in the United States under the Uyghur Forced Labor Prevention Act.

Shein, on the other hand, claims it never broke any laws. “Shein takes visibility across our supply chain seriously,” a company representative told the publication. The firm’s been behaving “lawfully with full respect for the communities [it] serves” for over a decade, they said.

For Temu, its business practices are raising red flags at the USCC, the report further claims: “Temu’s lack of affiliation with established brands has brought concerns of product quality as well as accusations of copyright infringement.”

The US-China relations have been in freefall ever since the Trump administration, with the banning of ZTE, the calls to eliminate Huawei from the development of global 5G infrastructure, and the arrest of Meng Wanzhou, chief financial officer of Huawei, who was detained on fraud charges.

In more recent times, the US government banned its employees from using China-made TikTok app on business endpoints (opens in new tab), saying the company might share personal user data with the Chinese government. ByteDance, the app’s creators, have vehemently denied these accusations.

Via: South China Morning Post (opens in new tab)

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