Prosecutor Andrew Edis said the tabloid's former royal editor Clive Goodman had emailed Coulson in January 2003 asking him to appove a 1,000-pound cash payment to a royal protection officer for a "Green Book" which contained private numbers of the royal household.
"These people will not be paid in anything other than cash because if they're discovered selling stuff to us they end up on criminal charges, as could we," the email presented to the jury said.
"This is fine," Coulson replied.
Edis said it was not clear whether Coulson had received the full email from Goodman including the warning, although he argued he had, but said Coulson had received enough to know that paying a police officer for a stolen book was illegal.
"He knows what he's involved in," Edis said.
(Reporting by Michael Holden; editing by Stephen Addison)
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