It's a June 24, 2003 email from the CRU archive:
From: "Mick Kelly"Why would you need money to cover the costs of a trip that wasn't made? And the concern that NOAA (that's a U.S. government agency) might become "suspicious" certainly has a whiff of something improper going on.
To: Nguyen Huu Ninh (firstname.lastname@example.org)
Subject: NOAA funding
Date: Tue, 24 Jun 2003 14:17:15 +0000
Content-Type: text/plain; charset="utf-8"
NOAA want to give us more money for the El Nino work with IGCN.
How much do we have left from the last budget? I reckon most has been spent but we need to show some left to cover the costs of the trip Roger didn't make and also the fees/equipment/computer money we haven't spent otherwise NOAA will be suspicious.
Politically this money may have to go through Simon's institute but there overhead rate is high so maybe not!
Mick [emphasis added]
UPDATE: A reader suggests that the NOAA funding might have been specifically for certain categories of activities, and CRU had used the money as some general purpose funding. That's a very easy mistake to make, and perhaps indicative of careless accounting as opposed to intentional fraud.