Tennessee lawmakers have decided (for the time being at least), that the state’s sportsbooks can continue to accept online wagers from payday loan customers. A bill that sought to make the practice illegal has been withdrawn and will not be debated again until next year’s legislative session. Ultimately, the bill did not progress as the draft measures under consideration by lawmakers were not specific enough.
The spotlight remains on TN sportsbook, Action 24/7
The primary focus of the bill that sought to deny customers who have high-interest pay day loans from Advance Financial 24/7 to be permitted to place sports wagers with the lender’s sister company, Tennessee’s own home-branded online sportsbook, Action 24/7. As we reported in January, the online sportsbook was given approval to accept cash deposits from sports bettors at Advance Financial branches in the Volunteer State. A number of Tennessee lawmakers expressed their concerns of the potential of irresponsible gambling arising from the practice, which led to the bill.
The proposed legislation sought to stop high-interest pay day borrowers from depositing into their sportsbook accounts, in addition to disallowing people from registering for an Action 24/7 sports betting account that had the goal of the borrowers earning money to pay off their loans. The Action 24/7 legal team lobbied aggressively against the legislation. Throughout the process, it was not revealed how many Advance Financial 24/7 pay day loan customers also have a matching Action 24/7 account, funded by their borrowings.
The Action 24/7 legal team has been very busy in recent weeks as controversary continues to surround the sportsbook operator. A recent ruling by the Davidson County Chancery Court has determined that the state’s gaming regulator, the Tennessee Education Lottery (TEL) will not be allowed to continue with is proposed punitive measures against Action 24/7 regarding a number of possible incidences of fraud in this February’s Super Bowl betting. TEL suspended the Action 24/7 online betting license to investigate the matter.
Despite a court ruling reinstating Action 24/7 operations after the potential fraud allegations, TEL was attempting to initiate another hearing into the issue to ensure that the online sportsbook operator is fully compliant with all aspects of the law. However, the overseeing judge on the case handed down an opinion that “TEL can’t have a redo.”
This suspension severely affected Action 24/7’s ability to operate during America’s second largest sports betting event after the NFL’s showpiece Super Bowl, the March Madness college basketball tournament. The reinstatement of the Action 24/7 sports betting license came on March 26 after the online sportsbook operator got an injunction.
The Pay Day Loan legislative debate was yet major dent on the reputation on Action 24/7, and the Tennessee sports wagering industry in general.
What now for the Action 24/7 Pay Day Loan Scheme?
Still, a number of Tennessee lawmakers are continuing to murmur behind the scenes despite the bill that can potentially kill off the sports betting/pay day loans scheme being dead in the water until at least 2022 at the earliest.
Despite the topic being put to sleep for the time being, it remains that the concept of permitting sports bettors to take out pay day loans with interest rates potentially as step as 280%, and paying them back with sports betting winnings doesn’t feel right, and as such, challenges the entire integrity of the Tennessee online sports wagering industry.
Some lawmakers are beginning to feel that the roles of the Sports Wagering Advisory Committee and TEL will be need to be reversed in order to more effectively regulate the state’s sports betting industry. As it stands, TEL makes the decisions for sports betting in Tennessee and the Committee sits in on meetings to pass opinion. A role reversal appears to provide the ideal solution for better and more efficient regulation moving forward.