This type of abuse happens frequently to many domain name owners, since spammers rarely use their own domain names in SPAM, and viruses select addresses randomly from other people's address books.
Sometimes spammers just make up return addresses to put in their spam and it is a coincidence that this time they chose one that happens to belong to you. Sending an email that appears to have come FROM someone who did not send it is known as "forging email".
Anyone with Outlook or any other email program can forge whatever address they want in the FROM field of an email, regardless of whether they own the domain name in the address, regardless of whether they have permission to use it, and regardless of whether the domain name even exists or is valid. There is nothing that the rightful owner of a domain name can do to stop people from sending out email with an address in the FROM field using someone else's domain name.
The most annoying part of having someone forge your email address in the FROM field of their outgoing SPAM is that "nondelivery" and other "bounce notifications" will be returned to you because the undeliverable messages appear to come FROM your address.
There also is nothing that a webhost can do to stop or prevent spammers or virus mails from wrongfully claiming that your email address came FROM or was the sender of a piece of spam or email virus.
The most you can probably do about this is to just delete virus mails and the bounce messages that may be coming to you as the purported sender.
We also suggest you do not use catch-all email which usually attracks more spam and undelivered emails.