Movie Gallery customers' credit reports marred by passive debt collection

A debt collection agency hired by bankrupt video rental company Movie Gallery - the owner of Hollywood Video - recently reached a settlement regarding claims of illegal collection attempts, according to the Greenfield Reporter. The agency - National Credit Solutions - allegedly sent collection notices for late fees and tarnished customers' credit reports, despite the fact that they never contacted the residents in question regarding debt owed prior to the collection attempt. Movie Gallery filed for bankruptcy in February of last year, and hired NCS to recover a total of $244 million in fees from approximately 3.3 million customers. NCS must pay the state of Montana $13,000 under the settlement, with more than $11,000 to be dispersed among the 91 residents who paid the agency. The remainder will be allocated to the DOJ. NCS is now prohibited from collecting debt from Movie Gallery customers in the future. Florida residents were also affected by NCS's collection efforts for Movie Gallery, according to the St. Petersburg Times. A total of 81,000 people who owed approximately $6 million in charges will be relieved of their debt obligation as a result of the ruling.