True cost of Temu revealed as security experts fear Chinese-owned shopping app could be SPYING on customers

WITH mascara on sale for just 98p and electronic tablets listed for less than £100, shoppers can’t seem to resist new sales website Temu.

But as its popularity grows, politicians and security experts warn that the true cost of the Chinese-owned shopping app could be far higher.

PDD head Lei Chen is in charge of Tema

Mum Jade Brogden decorated her daughter’s bedroom for £50 but fears an app is ‘spying’ on herCredit: Glen Minikin

Fears are growing in the UK and US that Temu could be collecting personal data for use by China’s Big Brother state.

Since launching in the UK this year, the app — which promises users they can “shop like billionaires” — has been downloaded nine million times by UK consumers, according to data firm Apptopia.

It’s now one of the most popular apps in the world, rivaling Amazon, thanks to low prices and a relentless barrage of social media ads.

Shares in US-traded parent company PDD Holdings jumped on Tuesday morning after the platform reported revenue of £5.7bn in the quarter to June – up 66 per cent on last year.

The company seemingly came out of nowhere to amass a valuation of £107 billion.

Fears that such Chinese apps could mine customer data for blackmail and spying purposes stem from the fact that they can tell how long customers have been looking at certain products and how many times they have revisited certain pages.

This can be used to create data profiles, so companies can target people with ads that show products they’ll be more likely to buy.

But this can potentially be used for more sinister purposes.

Professor Sarah Morris, a digital forensics expert at the University of Southampton, said: “The more places that have and share your information, the more people can build a bigger profile, and that can lead to consequences in terms of identity theft and even profile and choose people, which is never good.

“In terms of espionage, if you’re looking for someone and you’re able to identify a habit and build a profile, that can certainly give you an advantage and lead to potential opportunities for harm.”

Tory MP Sir Iain Duncan Smith warned: “These Chinese companies like Temu are collecting data and they want your private information. The US is convinced of that.

“Chinese companies like Temu are subject to China’s national security laws. They must hand over that information to the government if it requests it.

“I have been warning for years that these companies target young people in the West, collect their social media, private information and can use it against you later. That’s why they collect all this intelligence about us.”

Another Pinduoduo app by PDD Holdings was suspended by Google in March after malware coding was discovered in some of its versions.

Google said it had removed the shopping platform from its online store due to “security concerns”.

But despite the fears, Temu is the most downloaded app in the UK this year as we snap up bargains — like a men’s chest bag for just £2.47, the same price as a manicure and pedicure kit, while a massage gun is £12, 37, and mascara only 98p.

There’s also a £98.49 tablet computer, which Temu says was £209.99, and a deep fryer priced at £53.89.

Mum-of-four Jade Brogden furnished her daughter’s bedroom for just £50 using an app.

The 27-year-old costume designer, from Mirfield, West Yorks, bought nautical-themed blankets, stuffed animals, pictures, stickers, lights, ornaments and other decorations and said: “If I bought it all in a shop in Britain I would have paid nearly £300.”

But Jade is worried about the app’s apparent ability to spy on her.

She said: “One day I was talking about needing a new sofa and suddenly my social media feeds were flooded with Temu adverts for sofas.

“But Temu launched at a time when people like me are in desperate need of bargains. It’s so useful I feel like I can’t afford not to use it.”

Data collectors

At this year’s Super Bowl — America’s most-watched sporting event — a 30-second theme ad that promised to “shop like a billionaire” was shown twice during the breaks, costing the company an estimated £11 million.

Temu’s sudden rise has been fueled by its “affiliate and influencer” programs that reward users for bringing in more players.

The website claims that if you sign up as an affiliate and bring in a new customer, you get a £3 referral fee and up to a 20 per cent commission on everything they buy.

If you join Temu’s influencer program you can get up to £300 in free products and earn up to £100,000 a month in affiliate cash.

Users are inundated with notifications inviting them to spin the roulette wheel for prizes or scratch the virtual scratcher for offers.

The app even has a video game, Farmland, where you can win free goods to take care of your virtual crops.

Neil Saunders, from data analytics firm GlobalData, said: “Special offers and countdowns are not uncommon, but Temu takes this to a whole new level – they just plaster them all over the app. It keeps customers coming back.”

But with so many deals on offer, analysts think Tema is currently selling at a loss, which they say is designed to gain market share against global rivals such as Amazon.

The key to the low prices is the lack of brands and customers buying directly from Chinese factories, with Temu as the sole intermediary.

Last month, a Sun investigation revealed how the site had been plagued by negative reviews, claims of undelivered packages and poor customer service.

Most worryingly, a US congressional committee report warned that Temu’s suppliers may be using forced labor in China’s Xinjiang province.

There, the Chinese government is accused of genocide, targeting the Muslim Uyghur people.

Undermine rivals

Chloe Cranston, of the British charity Anti-Slavery International, said: “The Chinese government is undertaking a vast system of persecution of the Uyghur people across the region using internment camps, mass surveillance and torture.

“The head of the UN for human rights has concluded that this abuse may amount to crimes against humanity. It is a vast system of forced labor carried out by the state throughout the region in numerous industries.”

The news potentially worried shopper Ksenija Temel, who bought a dress on the site for just 69 pence.

The 42-year-old carer from Greenwich, south-east London, said: “I get so many compliments when I wear my 69p dress.

“But I would stop buying from Temu if I found out the items were made with child or slave labor.”

Temu’s owner, PDD Holdings, is the brainchild of China-born ex-Googler Colin Huang, 43, who founded it in 2015.

He is now China’s youngest self-made billionaire, with a fortune of £25 billion, according to Bloomberg, but will step back from day-to-day management in 2020.

It is now run by his countryman Lei Chen.

PDD has been accused of exploiting tax loopholes around the world to undercut competitors and legally avoid paying taxes on its goods.

A company can avoid paying import duties on products coming into the UK.

Earlier this year, according to US filings, Temu’s parent company moved from China to Dublin, where its global headquarters is now an anonymous office building that once housed EuroStore — the Irish equivalent of a pound shop.

Ireland is known for its low tax rates, and Richard Murphy, professor of accounting practice at Sheffield University’s School of Management, said: “There are many good reasons to be concerned about Temu’s business model.

“Choosing Dublin as its headquarters suggests it wants to take advantage of all the tax opportunities Ireland still provides for Internet-based businesses.

“Apart from VAT receipts, it appears to add no value to the UK economy but undermines local businesses and the jobs they provide.”

Temu did not respond to requests for comment.