Movie Gallery's liquidation trustee has settled a complaint regarding its debt collection
, offering consumers nationwide some relief.
Consumer protection advocates from all 50 states teamed up in an effort to object to the company's debt collection practices, as the firm, which is owned by Hollywood Video, attempted to collect $244 million in outstanding charges owed by 3.3 million customers. According to the Portland Business Journal, the firm filed negative reports to credit agencies, pursued claims without verifying their accuracy and added penalties and late fees to outstanding charges. Until denied credit, many consumers were unaware that they even owed the movie rental company. The issue first was sparked when Hollywood Video and Movie Gallery filed for Chapter 11 in 2010 due to the impact of the recession and the success of online rental services, reported the source. Under the agreement, Hollywood Video and Movie Gallery must "rescind all negative information submitted to any credit agency or bureau related to the accounts of customers in participating states. Additionally, no further credit reports
will be submitted," The Providence Journal reported.