From Customer365 for SageCRM
To use internal email (use this when not using CRM notifications) set the config option UseEmail to be Y (case-sensitive). The default is N
<add key="UseEmail" value="Y"/>
You also need to set the following parameters
<add key="EmailFrom" value="someone@server.com"/> <add key="EmailHost" value="mail.server.com"/> <add key="EmailHostPort" value="25"/> <add key="EmailUserName" value="someone@server.com"/> <add key="EmailPassword" value="userspassword"/> <add key="AdminEmailAddress" value="admin@server.com" />