Photo by Pam Lane

After Hollywood Video went bankrupt, the lawyers liquidating its assets hired a collection agency to chase millions of the chain’s former customers for late fees they allegedly owed. The agency reported the debts to credit bureaus which drove down the customers’ credit scores.  The problem was many of the people did not owe Hollywood Video anything.
In a victory for consumers, Hollywood’s lawyers have agreed to change their collection tactics and obey the federal Fair Debt Collection Practices Act.  The lawyers will even refund money to customers who gave into the agency’s strong-arm tactics and paid money they did not owe.
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