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updated 5/23/2011 8:21:51 PM ET 2011-05-24T00:21:51

A devious new Trojan is putting the fear of hard drive failure into computer owners, and then rushing in to "save" the day — at your expense.

Once the "Fakefrag" Trojan finds its way onto your system via specially crafted malicious Web pages, it gets to work on the task of making you believe all your files have been erased from your hard drive, the security firm Symantec reported.

Scareware scams, which try to convince users they have a computer virus, and then trick them into purchasing fake antivirus software, are nothing new. However, Fakefrag takes the crime a step further: it actually moves your files from the "All Users" folder to a temporary location, and hides files in the "Current User" folder, Symantec said.

It also disables the Task Manager, prevents you from changing your background image and hides your desktop icons.

If this happened to you, you'd think something was seriously wrong, and whoever is behind this scam knows this.

As it is hiding your files — and presumably making your heart sink — Fakefrag magically makes an error message appear with the enticing offer to run a "system diagnostic utility to check your hard drive disk for errors." Submitting to this diagnostic check launches a phony program called WindowsRecovery, which tries to bilk users out of $79.50 for the supposed hard drive recovery.

Security experts recommend always running up-to-date antivirus software, and never handing over credit card information to unsolicited offers.

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