diff --git a/CONTRIBUTORS.txt b/CONTRIBUTORS.txt
index 228973a60..9894c43bb 100644
--- a/CONTRIBUTORS.txt
+++ b/CONTRIBUTORS.txt
@@ -11,6 +11,7 @@ Alex Gaynor
 Alex Groce
 Alex Sandro
 Alexander Todorov
+Alexander Walters
 Andrew Hoos
 Anthony Sottile
 Arcadiy Ivanov
diff --git a/tests/test_process.py b/tests/test_process.py
index 9aade773d..ec6662c2e 100644
--- a/tests/test_process.py
+++ b/tests/test_process.py
@@ -9,6 +9,7 @@
 import os
 import os.path
 import re
+import stat
 import sys
 import textwrap
 import time
@@ -1004,6 +1005,23 @@ def test_coverage_custom_script(self):
         out = self.run_command("python -m run_coverage run how_is_it.py")
         self.assertIn("hello-xyzzy", out)
 
+    def test_bug_862(self):
+        if env.WINDOWS:
+            self.skipTest("Windows can't make symlinks")
+        # This simulates how pyenv and pyenv-virtualenv end up creating the
+        # coverage executable.
+        self.make_file("elsewhere/bin/fake-coverage", """\
+            #!{executable}
+            import sys, pkg_resources
+            sys.exit(pkg_resources.load_entry_point('coverage', 'console_scripts', 'coverage')())
+            """.format(executable=sys.executable))
+        os.chmod("elsewhere/bin/fake-coverage", stat.S_IREAD | stat.S_IEXEC)
+        os.symlink("elsewhere", "somewhere")
+        self.make_file("foo.py", "print('inside foo')")
+        self.make_file("bar.py", "import foo")
+        out = self.run_command("somewhere/bin/fake-coverage run bar.py")
+        self.assertEqual("inside foo\n", out)
+
     def test_bug_909(self):
         # https://github.com/nedbat/coveragepy/issues/909
         # The __init__ files were being imported before measurement started,