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Is Your Shopping Spree at Shein Compromising Your Personal Security?

Daniel Kim Views  

Yonhap News

Chinese e-commerce giant Shein has been criticized for potential security issues, including personal data breaches, that could occur as it exports its logistics supply chain services and technology to the global market.

Concerns were raised from within the U.S. that the Chinese government could seize data on logistic supply chain information and sensitive personal data of global consumers through Shein.

According to CNBC on Tuesday, experts continued to voice concern that the personal information of shoppers could be seized by the Chinese government as Shein expands its presence on a global stage.

Shein is a clothing brand and e-commerce company often referred to as “China’s Uniqlo.” CNBC has also suggested that Shein is emerging as a rival to America’s largest shopping mall, Amazon.

Shein is gradually expanding its global footprint, with pop-up stores recently launched in South Korea as well.

According to CNBC, Shein plans to build a business model that provides its proprietary supply chain management services and technologies to clients worldwide to generate revenue.

Shein’s supply chain software includes technology that allows vendors to communicate in real-time with logistics and freight companies, monitor and track delivery status, and increase work efficiency.

Small businesses that find it difficult to build such infrastructure themselves are expected to be the main customers.

CNBC reported that experts worry that due to the nature of supply chain software, it’s easy to access information from related companies as small businesses are likely to have weak security systems.

There is ample opportunity for Shein to steal various data, including consumers’ personal information, in the process of providing supply chain management services to global clients, including the United States.

Policy advisory firm Longview Global told CNBC, “Considering the current state of the U.S. supply chain, the potential for information theft is a serious risk,” adding, “Shein’s software could potentially have unrestricted access to sensitive information.”

Concerns were also raised that the Chinese government could pose a significant security threat to the overall U.S. supply chain because it can obtain such information under relevant laws.

Shein has been responding to such concerns by moving its headquarters from China to Singapore in 2022 to distance itself from China. However, most of its logistics warehouses and other infrastructure remain in China.

CNBC cited expert criticism that the Chinese government can still obtain various information from Shein, and moving the headquarters to Singapore is merely a disguise.

Shein told CNBC that it is making efforts to minimize the amount of information collected during the e-commerce process and is striving to protect information according to global standards.

They also explained that they are addressing security concerns by storing the personal information of American consumers in cloud servers located in the United States, owned by Microsoft and Amazon.

Despite this, CNBC reported that experts continue to point out that the possibility of Shein and the Chinese government exploiting supply chain and consumer-related information remains.

Shein had attempted to list on the U.S. stock market, but it was effectively thwarted by strong opposition from the U.S. political sphere. Shein is currently considering making an IPO debut on the London Stock Exchange in the U.K.

Longview Global urged for caution as global companies using Shein’s supply chain management services would essentially be handing over various information. They also pointed out that this could ultimately lead to Shein gaining market dominance, negatively affecting the industry as a whole.

This is not the first time Shein has come under fire for issues related to personal data. In 2022, Shein and its affiliates were slapped with a fine of $1.9 million in the U.S. for personal data breaches.

Daniel Kim
content@viewusglobal.com

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