The malware in question is a port from Windows, and its functionality on the Mac is extremely limited. It can't, for instance, gain root privileges, so all it can do is work within the confines of the user who installed it. This can certainly be bad, but it's still a vital detail to mention. It can, for instance, open a fake administrator password dialog. For the rest, the tool is apparently in beta, coded by someone with a very insecure grasp of English.
As is always the case, the story comes from an antivirus company, Sophos, which happens to also sell a Mac version of their software (how entirely unrelated and not at all convenient). Sophos also stirs up the usual drama about how this is indicative of the rising popularity of the Mac and that more malware is sure to follow soon - something we've been hearing for years now, but never actually materialises.
Is the Mac a secure platform? Well, if you look at it from a practical standpoint - the standpoint that matters to most users - it is a very secure platform, with no widespread and/or destructive infections. From a theoretical standpoint - well, that's for experts to decide. The story is the same for Windows Vista and up; these platforms, when kept properly up to date, are, like the Mac, incredibly secure in practice.
All in all, these stories are linkbait - plain and simple. Security companies are a lot like politicians - they spread fear (terrorism, computer viruses) because they've got something to sell (laws that further impede your rights so they can maintain their own power, security software). Like politicians, security companies are not tobe trusted, and are probably the worst scum in the software industry.