Carole's neighbor was sending email using Hotmail to inform her friends of a new address. After that, she wasn't able to log back into Hotmail. Simply sending mail out on Hotmail will not compromise her account. It's possible that someone did guess her password and compromised it that way, but since she can still access the account from work, that's probably not the case. It's likely a browser issue on her home computer.
Next, a message popped up from Vipre AntiVirus instructing her to call a company called "TechVantedge" that claimed to be affiliated with Vipre. They spend 7 hours accessing the computer, and then charged her $350. TechVantedge claims to be based in New York, but the chatroom did some research and found that they actually are based in India. Leo says that whether this company is legitimate or not, we know that legitimate tech support companies overseas have been known to scam people on the side.
At this point, she should backup her data, then use her system recovery disks and wipe the computer. She should do a full erase and reinstall. She should also call Vipre and ask if they are in fact affiliated with TechVantedge. If Vipre denies they have any connection with this, then she should change her credit card number and dispute this charge.
After she's erased the drive and reinstalled Windows, she should run Windows Update until there are no more updates.