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From what I can find out from other sources other than the biased author of this article, Ed Bott, who writes only negative articles about Apple, the malware DOES still need to be installed... following the download. The only thing that gets opened automatically is the downloader which is in an auto-executing zip file. The primary difference is that it no longer is requiring the administrator password for those who are running as administrator level users who have "Open 'safe' files after downloading" checked in Safari. ALL OTHERS who are running as Standard Users are not at risk from this malware!

Apple's online instructions on how to dispose of this malware are still effective... contrary to Bott's negative comment of "too little, too late!"

Summary

A recent phishing scam has targeted Mac users by redirecting them from legitimate websites to fake websites which tell them that their computer is infected with a virus. The user is then offered Mac Defender "anti-virus" software to solve the issue.

This “anti-virus” software is malware (i.e. malicious software). Its ultimate goal is to get the user's credit card information which may be used for fraudulent purposes.

The most common names for this malware are MacDefender, MacProtector and MacSecurity.

In the coming days, Apple will deliver a Mac OS X software update that will automatically find and remove Mac Defender malware and its known variants. The update will also help protect users by providing an explicit warning if they download this malware.

In the meantime, the Resolution section below provides step-by-step instructions on how to avoid or manually remove this malware.

Products Affected

Mac OS X 10.4, Mac OS X 10.6, Mac OS X 10.5

Resolution

How to avoid installing this malware

If any notifications about viruses or security software appear, quit Safari or any other browser that you are using. If a normal attempt at quitting the browser doesn’t work, then Force Quit the browser.

In some cases, your browser may automatically download and launch the installer for this malicious software. If this happens, cancel the installation process; do not enter your administrator password. Delete the installer immediately using the steps below.

Go into the Downloads folder or your preferred download location.
Drag the installer to the Trash.
Empty the Trash.

How to remove this malware

If the malware has been installed, we recommend the following actions:

Do not provide your credit card information under any circumstances.
Use the Removal Steps below.

Removal steps

Move or close the Scan Window
Go to the Utilities folder in the Applications folder and launch Activity Monitor
Choose All Processes from the pop up menu in the upper right corner of the window
Under the Process Name column, look for the name of the app and click to select it; common app names include: MacDefender, MacSecurity or MacProtector
Click the Quit Process button in the upper left corner of the window and select Quit
Quit Activity Monitor application
Open the Applications folder
Locate the app ex. MacDefender, MacSecurity, MacProtector or other name
Drag to Trash, and empty Trash

Malware also installs a login item in your account in System Preferences. Removal of the login item is not necessary, but you can remove it by following the steps below.

Open System Preferences, select Accounts, then Login Items
Select the name of the app you removed in the steps above ex. MacDefender, MacSecurity, MacProtector
Click the minus button

Use the steps in the “How to avoid installing this malware” section above to remove the installer from the download location.

Note: Apple provides security updates for the Mac exclusively through Software Update and the Apple Support Downloads site. User should exercise caution any time they are asked to enter sensitive personal information online.

it no longer is requiring the administrator password for those who are running as administrator level users who have "Open 'safe' files after downloading" checked in Safari. ALL OTHERS who are running as Standard Users are not at risk from this malware!

So, since I run Firefox, not Safari, I shouldn't worry? (In any event, I'm not dumb enough to run an installer I didn't intentionally download, no matter how "official" looking it is.)

Thank you for the update!
May YHvH give you comfort
on the passing of your loved ones.

shalom b'SHEM Yah'shua HaMashiach