No luck this year
A bill in Tennessee that aimed to stop sportsbooks from accepting bets from payday loan customers has proven unsuccessful. The proposal’s companion bills are no longer up for discussion in the legislature, meaning that no such changes will come into place this year. The bills ultimately did not progress as the draft measures were not specific enough.
raised concerns about responsible gambling among certain lawmakers
The main focus of the proposal was stopping people who have high-interest borrowings from Advance Financial 24/7 to be able to place sports bets with the lender’s sister company, Action 24/7. In January, the sportsbook got approval to accept cash deposits from sports bettors at the physical branches of Advance Financial in Tennessee. This raised concerns about responsible gambling among certain lawmakers, leading to this proposal.
As well as aiming to block high-interest borrowers from funding their sportsbook accounts, the bill also wanted to stop people from starting a sports betting account with the goal of earning enough money to pay off their loans. Lawyers for Action 24/7 had been busy lobbying against the legislation. They did not reveal how many Advance Financial 24/7 payday loan customers also have Action 24/7 accounts.
Another win for Action 24/7
Action 24/7’s legal team was also putting out fires elsewhere in recent weeks. A Davidson County Chancery Court ruling on Monday means that the Tennessee Education Lottery (TEL) Board of Directors is not able to take punitive measures against Action 24/7 regarding possible incidences of fraud.
This is because the judge previously ruled upon the matter and the TEL Board of Directors had already labeled its upholding of the suspension of Action 24/7’s license as its “final action” on the issue. The state’s gambling regulator was attempting to have another hearing regarding the issue to protect public interest and to make sure that the operator is fully compliant. However, the judge said that the “TEL can’t have a redo.”
Last month, Chancellor Patricia Moskal ruled that the TEL did not provide proper due process to Action 24/7 before suspending its license and that a continuing suspension would threaten the financial well-being of the sportsbook. Therefore, the judge lifted the temporary suspension on the operator.
The fallout from the license suspension
The TEL had suspended Action 24/7’s license on March 18, making it the first online sportsbook to receive a suspension in the United States. The first instance of debit card fraud at Action 24/7 was on March 9, continuing for a number of days. It wasn’t until March 17 that the operator sent 23 reports about the suspected fraud to the TEL, with the regulator’s chair Susan Lanigan immediately suspending the license. Action 24/7 had only started constantly monitoring for fraud on March 16. A TEL Board of Directors meeting on March 19 ended with support for Lanigan’s decision to suspend the license.
….our business is being destroyed. Literally, not dramatically, truthfully. Without question.”
On March 23, Action 24/7 filed a lawsuit against the TEL in an attempt to get a temporary injunction to lift the suspension. It also questioned the process that the TEL followed in suspending the license and the allegations of fraud. Action 24/7 attorney E. Steele Clayton IV said to the court: “….our business is being destroyed. Literally, not dramatically, truthfully. Without question.”
This suspension was active during the March Madness college basketball tournament, a major betting event in the United States each year. The reinstatement of the license came on March 26 after the operator got its injunction.
Action 24/7 could still face action from the TEL over a different matter. One of the sportsbook’s contracted workers made over 40 accounts for bettors in other states in advance of the Super Bowl, allowing them to make hundreds of bets. The TEL turned this case of interstate gambling over to law enforcement, with the TEL to decide on taking potential action once law enforcement concludes its investigation.