I have a weird issue where if I place a forum module in a child portal, I am unable to add attachments.
I get an message "a server error has occurred"
The javascript console says the a 401 unauthorized error has happened.
But my hosting company assures me they they have opened up all permissions and sent me screenshots to prove it.

None of this is a problem if I have the module in the root portal. But unfortunately, I need it in the child portal.
I have tried with both the last stable release 5.2.2 and the very latest Beta version and it still happens.

Does anyone know a fix for this?

Are you using Active Forums? If so, asking this question on their support forum is probably also a great idea.

The 401 error is "HTTP Error 401 - Unauthorized: Access is denied due to invalid credentials." This means that the website doesn't recognize something as not being logged in or not having permission to do something.

The most common error that occurs with child forums is that the main site is, for example, mysite.com where as the child site is mysite.com/childsite.

In your case, you need to be generating URLs that are like mysite.com/childsite/xxx. It is likely or possible that the module is looking for the attachment or trying sto save the attachment in mysite.com (where you are NOT logged in) instead of mysite.com/childsite (where you are logged in). You might be able to see that in the full text of the error message, or in the error log where the details may be more extensive.

If that's the case, there is either a simple configuration fix or this is a bug in Active Forums (if that is what you are using). The folks at the Active Forums site should be able to help you with this.