Translation:They wear white sweaters.
Japanese uses different verbs for wearing different articles of clothing. So for a shirt or something that covers the upper half of your body, or for getting dressed in general, you use きます. For pants, skirts, shoes, socks, etc. for your lower body, you use はきます.
There are others, too, such as かぶります for hats or something you put on your head, かけます for glasses, はめます for rings or gloves, and several other verbs.
For the same reason that Jersey (NZ English for sweater) is no doubt not accepted - it is not possible for Duo to acknowledge and accept every single possible English equivalent from every English speaking country, area, dialect. But we can help them to try and get there by suggesting other English equivalents/possibilities that we are aware of. In fact I have received several emails from Duo recently saying that translations which I have suggested are now accepted. Everyone just needs to do their part by using the report button.
スウェター would be a better approximation, but not every katakana word comes directly from a english pronunciation either, also there is a level of popularity that comes with these loan words, if somehow catch up that everyone writes it one way, then that's the correct way to do it. In this case セーター it's a pretty popular word on japan already. スエーター and セエター are listed as other forms, but they are probably not a popular spelling.