"Error applying attributes" error message when you use EFS to encrypt a file in Windows 2000 Server (842601)

Important This article contains information about modifying the registry. Before you modify the registry, make sure to back it up and make sure that you understand how to restore the registry if a problem occurs. For information about how to back up, restore, and edit the registry, click the following article number to view the article in the Microsoft Knowledge Base:

256986 Description of the Microsoft Windows Registry

SYMPTOMS

When you try to encrypt a file or a folder by using Microsoft Encrypted File Service (EFS) in Microsoft Windows 2000 Server, the file or the folder may not be successfully encrypted. Additionally, you may receive the following error message:

Error applying attributes. The system cannot find the file specified.

CAUSE

The issue may occur when the HKEY_CURRENT_USER\Software\Microsoft\Windows\CurrentVersion\Explorer\User Shell Folders\Appdata registry subkey is missing from the Windows registry.

RESOLUTION

Warning If you use Registry Editor incorrectly, you may cause serious problems that may require you to reinstall your operating system. Microsoft cannot guarantee that you can solve problems that result from using Registry Editor incorrectly. Use Registry Editor at your own risk. To resolve this issue, add the missing registry subkey. To do this, follow these steps:

Click Start, click Run, type regedit, and then click OK.
Locate the following subkey:
HKEY_CURRENT_USER\Software\Microsoft\Windows\CurrentVersion\Explorer\User Shell Folders
Right-click the User Shell Folders subkey, click New, click String Value, type Appdata, and then press ENTER.
Right-click Appdata, click Modify, type %USERPROFILE%\Application Data, and then click OK.
Quit Registry Editor.