I know for a fact that Hotmail accounts are not reused. Once a Hotmail e-mail address is created that address is there forever. Even if you never login to it, the e-mail address is still there, waiting for you to return. Hotmail would NEVER allow another person to assume a previously used e-mail address unless they had the credentials to login to it.
Therefore, your story is either a lie or it is false information you were given.
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