This error is by a timeout of an SFTP operation. This problem may be caused by a misconfigured firewall. or attempting an SFTP connection to a server computer running Titan FTP Server (the issue was fixed in CuteFTP 8.1).
Verify the firewall settings and ensure that port 22 is open and enabled for SFTP transfers.
If you are connecting with a server computer running Titan FTP Server, update to CuteFTP 8.1 or greater.
Connecting to Secure Shell (SSH2) Sites
Troubleshooting SFTP Connections
Learning About SSH2