Helping people with computers... one answer at a time.
Once your Windows Live Hotmail account, or contact list, has been hacked or compromised, there are several steps to clean up after you get it back.
My husband's Hotmail contact list has been hacked and a phishing paragraph was sent to them. Now it appears whenever he tries to forward an email. How do we get rid of it?
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It's unusual that only the contacts would have been hacked into, and it's more likely your entire Windows Live Hotmail account has been compromised.
Frankly, I'm surprised you still have access.
But, given that you do, there are several steps you should take immediately, to recover from the damage that's been caused. One of those steps should take care of the phishing paragraph that's showing up.
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I'm going to assume you're using Windows Live Hotmail's web-based interface. In fact, many of the steps we'll take will need to be taken there.
The very first thing you should do is very simple: Change Your Password. This is so important, I'd go so far as to say do it now; before even reading the rest of this article. It's the first step to slowing down (though perhaps not preventing) the hacker from continuing to access your compromised account.
There are now several things you must change to regain total control of your account.
Start by clicking on the Options item in the far right of the Windows Live Hotmail display:

In the drop down menu that appears, click on More options.
On the resulting "Manage Your Account" page, click on View and edit your personal information. That will take you to a page much like this:

The short version is that while your hacker had access to your account, they had access to everything here. If they didn't change it, they likely could have seen important information that you might care about.
Change it.
For everything that makes sense, change it.
Change your password: as I mentioned above, to prevent the hacker from accessing your account.
Change your security question: to prevent the hacker from having changed it and using it for a password reset after you change your password.
Change your alternate e-mail address: to prevent the hacker from requesting a password reset to an account that he may have changed this to.
Change your mobile PIN, or remove your mobile number completely.
In billing options, consider removing or changing the payment method listed, and be sure to keep an eye on that credit card's statements in the future.
Also review the Additional options at the bottom of this page, making sure that the hacker didn't change permissions, marketing preferences, or anything else relating to your account.
That's the high priority stuff, but there are still plenty of things that need to be looked at.
Return to the "Manage Your Account" page. You'll want to double check almost every option listed on this page, as the hacker may have altered it while he had control of your account.
In particular, I'm guessing that you want to take a look at the "Personal e-mail signature" settings.

As the text of the feature states, the text in your signature is "added to the bottom of each e-mail message you send". I'm guessing that your hacker added his own personal message here, and that it's being automatically added to every message you send. Remove it.
In reality, if your hacker has been thorough there's a lot of damage they can do, and it can be a lot of work to re-construct your account. Remember that your Hotmail account is really your account for all Windows Live services, including Messenger, Spaces, Groups and who knows what else. While they had access to your account, they had access to all of that. And that means that they had access to any and all options relating to those other services in addition to Windows Live Hotmail.
It simply goes to underscore the importance of keeping your account safe, choosing a strong password, keeping it secure, and in general keeping your computer safe on the internet.
Prevention is so much easier than trying to clean up the mess after a problem.
Article C3734 - May 17, 2009
I've changed my password, but after I changed it, I still received a SPAM email from myself. I don't know what happened. How can I know my email is safe after it's been hacked?
15-Oct-2011
Posted by: Amy Mireles at October 14, 2011 3:53 PM
I changed my password, however in the alternate emails their is an address which is NOT mine and it will not allow me to delete it. It is {email address removed}. How can I get this alternate removed?
22-Oct-2011
My Hotmail account was closed and I've lost all my contacts. But on my other computer I came across this file of contacts with a ’windowslivefile’ extension. Is there any way of accessing these since I think they are the email addresses of my lost contacts.
If you can help it would be greatly appreciated.
Posted by: Vincent Braniff at October 26, 2011 11:42 AMLeo, I've now found a solution to the hacked Contacts list. In the abbreviated "Contacts" list that pops up when I start a new email and click the "To:" button, I had found "Adult" contacts added to the end of the list, and I couldn't find any way to delete them. Finally, I noticed that in the Hotmail left-hand sidebar under "Messenger," there was a message, "3 invitations." I clicked on that message, and was taken to a screen that showed several "friend requests" and below those, several "invitations" to join "Groups." Lo and behold, those groups had the same names as the bogus entries on my abbreviated Contacts list! And when I clicked to refuse the invitation, hooray, they disappeared from the abbreviated Contacts list! (They had never shown on the contacts list that appears when you click the sidebar option.) After refusing all of them, I went into my Profile (click on Profile in the upper right-hand corner of the screen, right under your name and beside "sign out.") I changed my profile options to the most private settings, and I hope that will prevent future unwanted appearings.
Posted by: Liz Case at November 22, 2011 8:22 PMhi there, i have signed into my different hotmail account and its sayin its been blocked, because of spamming, however i hav got personal information in there, so how do i unblock it, thankyou
19-Dec-2011