This is a general SFTP connection error. The SFTP server is using an encryption algorithm or cipher that is not supported by CuteFTP Pro. The most common cipher causing this error is AES which is not currently supported in CuteFTP Pro. Ask the administrator of the remote FTP server to allow use of a different cipher. The default configuration of CuteFTP Pro provides support for TripleDES, ARCFOUR, CAST128, Twofish, Twofish128, AES128, AES256, and Blowfish automatically.
See Trouble Shooting SFTP connections for details.