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This seems like an odd one. I installed iTerm2 shortly after doing a fresh install of Big Sur on my laptop. A bit after that, I installed VMware Fusion and went on with my life. Tonight, I wanted to check something in my Downloads directly in iTerm2, so I did a simple ls ~/Downloads and the privacy permissions popup appeared, saying

"VMware Fusion" would like to access file in your Downloads folder.

Since I wasn't actively using VMware Fusion -- the VM was paused and hadn't been used since I last rebooted a few hours earlier -- I said "Don't Allow" and went back to iTerm2, which promptly denied my viewing of my ~/Downloads directory. Odd.

I stopped both apps, then went into the Privacy tab and deleted all "Files and Folders" permissions for both VMware Fusion and iTerm2, then restarted iTerm2. Went into ~/Downloads again and got the same pop-up asking for permission for VMware Fusion to access the Downloads folder. Started VMware Fusion up and it asked for permission to view files in ~/Documents.

I'm kind of stuck on this one and not sure how to go about debugging it. I'm guessing that VMware may have stomped on some identifier that iTerm2 uses in the Privacy settings, but I'm not sure how to go about untangling this. I'm inclined try uninstalling VMware Fusion, then try it, but I'm wondering if there's something else I can do first, before taking that step.

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For what it's worth, removing VMware Fusion, then reinstalling it seems to have fixed the issue.

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