Former News International chief executive Rebekah Brooks was asked to authorise a £4,000 payment for photographs of Prince William dressed in a bikini leaked by a Sandhurst contact, a court heard today.
In June 2006, Brooks received an email from a journalist on The Sun asking for the money.
Andrew Edis QC read out the email during his opening speech at the Old Bailey.
The email stated: "My best contact at Sandhurst who has provided some great stuff over a period of months is offering us a picture of William at a James Bond party dressed as a Bond girl.
"He is wearing a bikini and an open Hawaiian shirt."
Edis told the jury of nine women and three men that in 2006 while editor of The Sun, Brooks authorised payments to be made to an official who gave details about dead soldiers out before they were officially announced by the MoD.
"It may concern, for example, the death of active servicemen," he said. "It really matters when it is released and how it was released to other people affected by it."
The court was told about a series of emails to Brooks asking for authorisation for various cash payments, all said to have been okayed by her.
"These are emails which reveal what Mrs Brooks knew when she authorised the payments and the fact that she did authorise the payments and we know from the timeline what the payments refer to and the fact that they were made.
"The prosecution suggest that in behaving in that way Mrs Brooks was involved in a conspiracy to commit the criminal offence of misconduct in a public office and that she knew it."
The court had earlier heard how the News of the World used phone hacking to get stories on the royals, including a claim that Prince Harry had broken rules at Sandhurst by asking an aide for help with an essay.
Edis outlined the details as part of the charges Brooks is facing for allegedly conspiring to commit misconduct in a public office.
The former NI chief executive denies the charges, as well as allegations of phone hacking.
Edis (pictured above) said that a story in the now-defunct tabloid, titled "Harry's aide helps out on Sandhurst exams", came from a voicemail illegally accessed by private investigator Glenn Mulcaire for former royal editor Clive Goodman.
Jurors heard the story had come from a voicemail message left by Harry for his private secretary Jamie Lowther-Pinkerton, himself a former member of the armed forces, asking for information to help with an essay.
The court heard that the prince asked his aide if he "had any information at all" about the Iranian embassy siege – the scene of a British special forces operation in 1980 – adding: "Because I need to write an essay quite quickly on that but I need some extra info.
"Please, please email it to me or text me."
The tabloid also obtained information about Prince William getting "shot" during a training exercise in Aldershot, jurors were told.
Edis said: "William found himself in the wrong place during a night exercise so he got shot, pretend shot.
"There is a voicemail, recording of a voicemail, in which Prince William says something about that. So it's a phone hack."
Jurors were also told that a top aide to the Prince of Wales was targeted by the NotW journalists, chasing false rumours that the Royal's private secretary Sir Michael Peat had been having an affair.
Prosecutors claim that Goodman paid for two copies of a Royal telephone directory from palace police officers, with the funds allegedly authorised by Andy Coulson.
Edis said that the policeman, who was paid under the name David Farish, was never identified.
The high-profile trial has already heard the revelation that Brooks and Coulson had an affair for at least six years, with extracts from a heartfelt letter from Brooks to her then deputy editor read to the court.
Brooks, 45, of Churchill, Oxfordshire, and Coulson, 45, from Preston in Kent, (pictured above) are both accused of conspiracy to intercept communications in the course of their transmission.
They are accused of conspiring with former News of the World, head of news Ian Edmondson, 44, from Raynes Park, south-west London, the tabloid's ex-managing editor Stuart Kuttner, 73, from Woodford Green, Essex, and others to illegally access voicemails between 3 October 2000 and 9 August 2006.
Ex-NoW and Sun editor Brooks is also charged with two counts of conspiring with others to commit misconduct in public office, one between 1 January 2004 and 31 January 2012 and the other between 9 February 2006 and 16 October 2008, linked to alleged inappropriate payments to public officials.
She faces another two allegations of conspiracy to pervert the course of justice – one with her former personal assistant Cheryl Carter, 49, from Chelmsford in Essex, between 6 July and 9 July 2011.
It is alleged that they conspired to remove seven boxes of material from the News International archive.
The second count alleges that Brooks, her husband Charles Brooks and former head of security at News International Mark Hanna conspired together and with others between 15 July and 19 July 2011 to pervert the course of justice.
It is claimed that they tried to conceal documents, computers and other electronic equipment from police officers who were investigating allegations of phone hacking and corruption of public officials in relation to the News of the World and The Sun newspapers.
Former Number 10 spin doctor and ex-NotW editor Coulson is also facing two allegations that he conspired with the tabloid's former royal editor Clive Goodman, 56, from Addlestone in Surrey, and persons unknown to commit misconduct in public office – one between 31 August 2002 and 31 January 2003; and the other between 31 January and 3 June 2005.
All of the defendants deny the charges.
The case was adjourned until Monday when Edis will resume his opening remarks.