Quick Answer: A ProPublica investigation reveals that Advance Financial, a Tennessee payday lender charging 279.5% interest, let customers borrow money and deposit it directly into Action 247, an online sportsbook majority-owned by the same family. Regulators were alarmed but politically outmaneuvered. No other state allows this arrangement.
Borrow at 279%, Gamble Immediately
Imagine walking into a payday loan shop, borrowing $4,000 at 279.5% interest, and then depositing it into a gambling account — at the same counter. That’s what happened in Tennessee for over five years, according to a ProPublica investigation.
The Players
According to ProPublica’s reporting, here’s who was involved:
- Advance Financial: A Tennessee payday lender with approximately 80 storefronts, owned by Michael and Tina Hodges. Offered loans up to $4,000 at 279.5% annual interest.
- Action 247: An online sportsbook, majority-owned by the same Hodges family. Launched in November 2020.
The arrangement was simple: brochures appeared in Advance Financial stores advertising a $2 fee to deposit borrowed money directly into Action 247 gambling accounts.
What Regulators Found
When Tennessee’s lottery board discovered this arrangement in December 2020, the response was immediate concern. ProPublica reports that lottery board chair Susan Lanigan stated regulators were alarmed, noting their licensing decision may have been based on an incomplete picture of the company.
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Why This Matters: According to Brianne Doura-Schawohl, a former legislative director for the National Council on Problem Gambling, mixing high-interest lending with gambling is “unhealthy and predatory.” No other state permits high-interest lenders to own gambling operations and use storefronts to attract customers.
The Political Response
What happened next, according to ProPublica, followed a familiar pattern:
- March 2021: The lottery board suspended Action 247’s license for lacking proper internal controls
- April 2021: Tennessee House Speaker Cameron Sexton — whose campaigns received approximately $105,000 from Advance Financial over a decade — met with the lottery board chair and reportedly made it clear he was not happy with the suspension
- May 2021: Sexton passed legislation removing lottery oversight of sports betting entirely, creating a new agency
- April 2021: A bipartisan bill to ban payday lenders from offering gambling services — co-sponsored by nearly one-third of the House — was withdrawn after Advance Financial’s lobbyist worked against it
The Pattern: Regulators raise concerns. Politicians who received donations intervene. The regulations get weakened or removed. The predatory arrangement continues. This is how consumer protection gets undermined.
Why Payday Lending + Gambling Is Dangerous
Research consistently shows that problem gamblers struggle with financial decision-making and are more likely to carry significant debt. Putting a payday lender and a sportsbook under the same roof — owned by the same family — creates a pipeline from desperation to deeper debt.
The Debt Spiral
- Borrow at 279.5% interest to fund gambling
- Lose the gamble — as most people do
- Now owe the loan plus interest with nothing to show for it
- Borrow again to cover the first loan or chase losses
- Repeat until broke
The Ending
Action 247 announced its closure on January 16, 2026. Tina Hodges attributed the shutdown to the gambling market being unviable and unprofitable for all operators. Advance Financial’s 80 payday loan storefronts remain open.
Before You Sign Anything: If you’re considering a payday loan, high-interest loan, or any financial product marketed alongside another service, run the contract through the Contract Decoder first. It’s free — and 279.5% interest should never be anyone’s first option.
Sources
- ProPublica — Full investigative report on the Advance Financial/Action 247 arrangement
Frequently Asked Questions
Is it legal to combine payday lending with gambling?
According to ProPublica’s reporting, no other state permits high-interest lenders to own gambling operations and use their storefronts to attract customers. Tennessee’s lottery board attempted to intervene but was overridden by legislation that removed their oversight of sports betting.
How much interest does Advance Financial charge?
According to ProPublica, Advance Financial charges up to 279.5% annual interest on loans up to $4,000. These are commonly known as payday loans or high-interest installment loans.
What can I do if I’m stuck in payday loan debt?
Payday loan debt traps are real, but there are options. For legal questions about your specific situation, consult with an attorney licensed in your state. You may also want to explore all your debt relief options, including those many people don’t consider.
Is Action 247 still operating?
No. Action 247 announced its closure on January 16, 2026, citing an unviable and unprofitable market for state-licensed online sports gambling.
TL;DR: ProPublica reveals a Tennessee payday lender charging 279.5% interest let customers deposit borrowed money directly into a sportsbook the same family owned. Regulators were alarmed but got politically sidelined. The sportsbook closed in January 2026, but the payday lender’s 80 stores remain open. Debt is math — and 279.5% math always ends the same way.
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