by Kyle Hopkins, Anchorage Daily News, and Megan O’Matz and Joel Jacobs, ProPublica

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Dr. Phil, the powerhouse TV personality, has long dispensed practical advice to anyone hoping to avoid financial ruin — advice he’s shared with his millions of viewers. “No. 1 is avoid debt like the plague,” he’s said.

On other episodes of his syndicated talk show, he’s urged people to pay off their costliest obligations first: “You got to get rid of that high-interest debt.”

Yet for thousands of people mired in debt, Dr. Phil’s eldest son has been part of the problem, an investigation by ProPublica and the Anchorage Daily News found.

Jay McGraw, a TV producer, became involved in the payday lending industry over a decade ago and has been affiliated with a range of financial services businesses, more recently launching a firm that sells used cars online at costly interest rates and targets Texans with low or no credit.

Earlier this year, McGraw settled a federal civil suit that had accused him of playing a key role in CreditServe Inc., a financial technology consulting firm that helps arrange small-dollar consumer loans online — with interest rates that can exceed 700% — via a company owned by a Native American tribe in Alaska.

The tribal lending operation, Minto Money, is based in the log cabin village of Minto, 50 miles northwest of Fairbanks, and has delivered a new revenue stream to the community since its inception in 2018. But it’s also created a rift within the tribe, as some members are appalled by the burdens inflicted on poor and desperate people.

“It’s bringing in a lot of money. But it’s off the misery of the people on the other end who are taking out these loans,” said Darrell Frank, a former chief of the tribe. “That’s not right. That’s not what the elders set this tribal council up for.”

There’s documented harm. As of July 2024, the Federal Trade Commission had received more than 280 consumer complaints about Minto’s lending operations. That total includes complaints forwarded from the Better Business Bureau, where Minto Money holds an “F” rating. Customers who took out loans — which range from $200 to $3,000 — pleaded for relief from onerous terms that allowed Minto Money to claw back the sums multiple times over through automatic bank withdrawals.

“This loan is outrageous with interest over 700%!” one person complained to the Better Business Bureau about having paid $4,167 on a $1,200 loan from Minto Money. “I am one step away from filing from bankruptcy.”

A federal suit filed in Illinois in November by five Minto Money borrowers contends that McGraw has provided “tens of millions of dollars” in capital for the loans. CreditServe provides the infrastructure to market, underwrite and collect on them while “the Tribe is merely a front” and shares in only a small percentage of the revenue, according to the suit.

It called McGraw the “enterprise’s principal beneficiary,” asserting that he and CreditServe’s CEO, Eric Welch, have collected “hundreds of millions of dollars of payments made by consumers.”

The suit alleged that McGraw and the other defendants, including Minto Money, violated state usury laws and federal prohibitions against collecting unlawful debt. A confidential settlement resolved the lawsuit in early May but left open the possibility that other Minto Money customers could file similar suits in the future.

A. Paul Heeringa, who is representing McGraw, Welch and CreditServe, wrote in an email to reporters that “our clients cannot comment on any of your questions, or the case generally, other than to say that the allegations in the Complaint are not facts and were not proven to be true, and that our clients categorically deny the allegations.”

CreditServe was set up by a Hollywood lawyer who has represented the McGraws, California records show. Its principal address in the Larchmont Village neighborhood of Los Angeles is a box in a mail shop that also has served as the published address for many other McGraw family companies.

There is nothing in the public record linking Dr. Phil — whose full name is Phil McGraw — to the lending businesses, including CreditServe.

A lawyer for Phil McGraw said McGraw declined to comment for this story but shared a short statement from a spokesperson for Merit Street Media, which airs “Dr. Phil Primetime.”

“Dr. Phil knows his son........

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