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The tool is called Fail2Ban, and it works along side your iptables firewall by actively scanning your server's logs for suspicious activity, and automatically creating firewall rules to thwart the attacker.
From their page:
Fail2ban scans log files (e.g. /var/log/apache/error_log) and bans IPs that show the malicious signs -- too many password failures, seeking for exploits, etc. Generally Fail2Ban then used to update firewall rules to reject the IP addresses for a specified amount of time, although any arbitrary other action (e.g. sending an email, or ejecting CD-ROM tray) could also be configured. Out of the box Fail2Ban comes with filters for various services (apache, curier, ssh, etc).It works so good in fact, that when I setup a monitor for my webmail page that pings the site every five minutes, Fail2Ban thought it was suspicious and blocked them. I had to add their IP's to the Fail2Ban ignore list to get monitoring to work again.
Do you use Fail2Ban? Do you know of something better? Let us know in the comment.