US Republican senator calls for DOJ and Homeland Security to investigate Shein, Temu for counterfeiting

U.S. Republican Senator Tom Cotton of Arkansas sent a letter to Attorney General Pam Bondi on Monday calling for the U.S. departments of Justice and Homeland Security to investigate online retailers Shein and Temu, which ship most of their merchandise from China, for wide-scale intellectual property theft and counterfeiting. 

The letter, which was seen by Reuters, adds to the increased scrutiny of Shein and Temu, which both sell $20 shirts and $10 accessories, following the end of a U.S. trade exemption that helped both companies gain popularity in the region. Shein is privately held and Temu is owned by PDD Holdings.

Shein did not immediately respond to a request for comment.  A Temu spokesperson said a comment was not immediately available outside of normal business hours.

Shein has previously said that it requires its suppliers to certify that their products do not infringe on a brand's intellectual property and that they are not counterfeit. The company has a team that ensures its sellers comply with the policy and takes swift action if they are not in compliance, a spokesperson previously said. 

The ending of the de minimis exemption, which allowed packages shipped directly to shoppers valued at under $800 to enter the U.S. duty-free, has "forced Shein and Temu to change their business model," Cotton said in the letter.  

"These companies now stock massive inventories in U.S. warehouses and distribution centers. Their goods are no longer slipping through ports," Cotton said. "They are sitting on American soil under U.S. jurisdiction."

Texas Attorney General Ken Paxton said on Monday he is investigating whether Shein violated state law related to unethical labor practices and the sale of unsafe consumer products. France last week asked a Paris judge to suspend Shein in the country for three months over sales of childlike sex dolls and banned weapons.