To prevent the folder C:\app1\data from being monitored by Endpoint Data LossPrevention (DLP), follow these steps:

Configure File Path Exclusions:

Open the Microsoft Purview compliance portal.

Navigate to Data loss prevention > Overview > Data loss prevention settings > Endpoint settings.

Look for the File path exclusions section.

Add an exclusion for the path C:\app1\data.

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Remember to validate this configuration and ensure that the folder is excluded from DLP monitoring