Tennessee Lawmaker Wants to Clamp Down on Sports Book that Offers Payday Loans
Posted on: February 16, 2021, 09:46h.
Last updated on: February 16, 2021, 12:39h.
Tennessee State Rep. Darren Jernigan (D-60th) is making a stand against payday loans and sports betting, which he believes should not be served up on the same menu.
According to Jernigan, this is exactly what has been happening in the state’s brand-new sports betting market since the January licensing of Action 24/7.
The online sports book is part of the same group as local payday lender Advance Financial 24/7. This means gamblers can now fund their Action 24/7 accounts in the same physical space that they can apply for a 279% annual percentage rate (APR) loan. What could possibly go wrong?
Both brands are part of the Advance Financial Money Transmission Company. The company is owned by husband-and-wife business team Tina and Mike Hodges.
Significant donors to the Donald Trump reelection campaign, the Hodges describe themselves on their website as being “fascinated by thinking and living dangerously.” They are also devotees of an obscure branch of philosophy called “orientation,” and are founders of the Hodges Foundation for Philosophical Orientation.
But Jernigan believes orienting sports betting right next to predatory lending is a lousy philosophy.
Really, it is the literal definition of loan sharking,” Jernigan told Legal Sports Report. “I take a 279% interest loan and then gamble with it. The only difference is you don’t get your legs broken the next day. You go into a cycle of debt that ends up in bankruptcy.”
He’s also worried that customers might be encouraged to place a bet in a bid to “knock their loan off.”
Pause for Thought
As Sports Handle recently discovered, it is illegal in Tennessee for licensed payday lenders to sell lottery tickets, and it’s unclear why sports betting should be any different.
But the Tennessee Education Lottery Corporation’s (TELC) sports wagering committee found no impediment to Action 24/7’s licensing when it met in January, although its application was not approved without hesitation.
“It feels a little bit awkward that somebody could so easily use borrowed money to put money into a sports wagering account,” said board and committee member Will Carver during the meeting. “Because of where it’s located, it gets some pause.”
Now, Jernigan wants the rules rewritten. He has introduced a bill to the Tennessee legislature that would make it illegal for lenders to offer loans and to cash checks for people using the outlet for betting purposes.
Speaking to LSR, Jernigan also accused Action 24/7 of withholding customer sports betting winnings to pay off debts. A spokesperson for the company denied this was the case.
Related News Articles
Related News Articles
May 12, 2022 — 3 Comments—