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User creates a subfolder in a folder created on the network for his own files. The folder he created has no access rights to it. This just started to happen he says. Other users can do this with no problems and are all set up exactly the same. Why is it just this one user that this happens to? What can I check? Thanks in advance for any help

Look at the user top folder which they have the rights to. Inheritance checked? It should be. If not new subfolders won't get the permissions passed down.
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Thanks for the reply. :D
Do not want to inherit the top folder, only from his folder. To explain: We have E:> shared as corpshare$
User's folder is found at corpshare$\james_bennison . I want james_bennison to have all rights for himself and all rights for domain admins only. Anything he creates under his own folder needs to have the same rights as james_bennison. NOT corpshare$. corpshare$ gives all access to domain users. We do NOT want domain users to access james_bennison's folder.
I checked my folder and other user's folders and their folders do not have this checked and works fine. They are able to create a ton of subfolders with no problems with access rights.

"the user top folder " not as in c$ but as in james_bennison home folder.
look at a folder below james_bennison home folder. go to properties and advanced.
Does it say inherited from james_bennison ?
Do the same for james_bennison. Does it say no inherited but does it say "apply to" and lists folders, subfolders and files?
At the james_bennison no inherit refers to inheriting higher up like you were thinking concerning c$. That is not what I am talking about. I am talking inheritance from james_bennison folder on down.
Imagine the power if you knew how to internet search

moon, wanderer understands your issue. His comment was "Look at the user top folder which they have the rights to..." which is exactly what you should be looking at..
Also remove the Full Control and just give Modify. Users don't need to be able to set permissions if the permissions are properly set by the Domain/Enterprise Admin.
Life's more painless for the brainless.

Thanks. Yes it is checked.
OK I think the user's folder is corrupted. I created a new folder folder for him and it seems to be working properly. The permissions will be applied to anything he creates under it.
I notice that the james_bennison folder had permission applying to folders/subfolders/files, yet when he created a subfolder, that subfolder only had permissions applying to folder only and without any access to it. No matter how may times I reapplied the permissions at the top folder of james_bennison, it did not change this.
I created a new folder with a different name for the user. I set the permission to user and domain admins have full rights only. Copy all of his files from the corrupted folder to this one and see if the permissions apply properly. It worked.

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