S/MIME preference settings are treated as policy settings unexpectedly in Outlook 2007

Consider the following scenario:

• You use an S/MIME certificate to sign and encrypt the e-mail messages in Microsoft Office Outlook 2007.
• You set the registry to display the options for the Encrypt contents and attachments for outgoing meetings preference setting and for the Add digital signature to outgoing messages preference setting.
  
  To do this, you set the DWORD value of the AlwaysSign registry entry and of the AlwaysEncrypt registry entry under the following registry subkey to 1:
  HKEY_CURRENT_USER\Software\Microsoft\Office\12.0\Outlook\Security

In this scenario, the options for the Encrypt contents and attachments for outgoing meetings preference setting and for the Add digital signature to outgoing messages preference setting are displayed in the Message Options dialog box as expected. However, these two options are disabled, and you cannot change the settings. Additionally, the Digitally Sign Message toolbar button and the Encrypt toolbar button are disabled.

Important This section, method, or task contains steps that tell you how to modify the registry. However, serious problems might occur if you modify the registry incorrectly. Therefore, make sure that you follow these steps carefully. For added protection, back up the registry before you modify it. Then, you can restore the registry if a problem occurs. For more information about how to back up and restore the registry, click the following article number to view the article in the Microsoft Knowledge Base: To display these two options and make the settings user-configurable in the Message Options dialog box, follow these steps:

1. Remove the AlwaysSign registry entry and the AlwaysEncrypt registry entry from the registry.
2. Apply the Outlook 2007 hotfix package that is dated April 30, 2009.
   
   For more information, click the following article number to view the article in the Microsoft Knowledge Base:
   968858  (http://support.microsoft.com/kb/968858/ ) Description of the Outlook 2007 hotfix package (Outlook.msp): April 30, 2009
3. Set the DWORD values of the InitSign registry entry and of the InitEncrypt registry entry to 1. To do this, follow these steps:
   1. Start Registry Editor.
      • In Windows Vista, click Start
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        , type regedit in the Start Search box, and then press ENTER.
        
        
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        If you are prompted for an administrator password or for confirmation, type the password, or provide confirmation.
      • In Windows XP, click Start, click Run, type regedit in the Open box, and then click OK.
   2. Locate and then click the following registry subkey:
      HKEY_CURRENT_USER\Software\Microsoft\Office\12.0\Outlook\Security
   3. On the Edit menu, point to New, and then click DWORD Value.
   4. Type InitSign, and then press ENTER.
   5. Right-click InitSign, and then click Modify.
   6. In the Value data box, type 1, and then click OK.
   7. On the Edit menu, point to New, and then click DWORD Value.
   8. Type InitEncrypt, and then press ENTER.
   9. Right-click InitEncrypt, and then click Modify.
   10. In the Value data box, type 1, and then click OK.
   11. Exit Registry Editor.

Notes

• To make sure that this hotfix package works, you must remove the AlwaysSign registry entry and the AlwaysEncrypt registry entry from both of the following registry subkeys:
  HKEY_CURRENT_USER\Software\Microsoft\Office\12.0\Outlook\Security
  HKEY_CURRENT_USER\Software\Policies\Microsoft\Office\12.0\Outlook\Security
  Additionally, you must set the InitSign registry entry and the InitEncrypt registry entry in the non-policy section of the registry, such as in the following registry subkey:
  HKEY_CURRENT_USER\Software\Microsoft\Office\12.0\Outlook\Security
• After you follow these steps and then make changes to these settings in the Outlook user interface, the DWORD values of the InitSign registry entry and of the InitEncrypt registry entry are set to 2. Outlook 2007 then reads the preference settings from corresponding profile properties instead of from the registry.

Microsoft has confirmed that this is a problem in the Microsoft products that are listed in the "Applies to" section.