Coming from someone who is learning about them:
They are very vicious, they act in a manner that replicates a normal progra, so the Anti Virus thinks "Oh, hey, that's just another progra the person downloaded."
Most of them disable the core of the Anti Viruses which determines whether they find the infection or not.
I think McAfee has a program called Fake Alert, or something a long the lines of that, which is dedicated to finding them.
Malwarebytes is also an amazing program which is good because it finds anything out of the ordinary.
Thanks for your response, it is becuase of people like you that i was able to (i hope) clear this from my machine.. so how come i dont pay you $50 per year to keep my machine clear of viruses instead of paying McAfee ?? i would have thought that MS could also have stepped in and published a tool to get rid of this stuff in that this program poses as windows 7.. but again nothing .. we just rely on the kindness of strangers.
thanks again for your help and advice.
Moving this thread into Home User Assistance.
The answer to your question is, as Conor said, that fake AV programs aren't by themselves viruses or Trojans. They're software applications that you have to download, just like anything else. If the writers are smart (and producing these fake AV's is a flourishing industry in parts of Eastern Europe - offices, regular 9 to 5 employment, call centres, the works; so yes, they're smart) they won't load the programs with code that's going to wake up a real AV system and cause it to stop the download. Once you've triggered the download by clicking on some pop-up alert - even clicking Cancel, or No Thanks - the program is on your system, and running. And it's designed to stay there just long enough to persuade people to pay to fix all the non-existent errors that it claims to find.
That said, some of them now disable firewalls and AV programs and proceed to download real malware. Which is why Conor (and the rest of us) recommend having Malwarebytes available to run as and when necessary. You can simply rename the .exe to something else if the fake AV tries to block it from running. There are McAfee tools which will help rid you of these nuisances, but if the fake AV is interfering with your internet connection to McAfee then you won't be able easily to download them. So keep a copy of Malwarebytes handy for emergencies.
And if you're feeling generous then I have to say that we helpers, especially the nocturnal ones, wouldn't say no to a pizza :-)