A former executive who helped bring successful charges against his former colleagues over a sham AIG/Gen Re reinsurance deal has avoided a prison term.

John Houldsworth, the former CEO of Gen Re affiliate Cologne Re, received two years’ probation, a $US5000 ($6274) fine and 400 hours of community service from a US district court for his role in a 2001 accounting scandal.

Mr Houldsworth, who was CEO of Cologne Re’s Dublin-based unit from 1990 to 2005, pleaded guilty in 2005 to conspiracy charges. His evidence was crucial in helping lawyers win convictions against five former AIG and Gen Re executives.

Prosecutors proved the bogus deal sought to inflate AIG loss reserves by about $US500 million ($628 million).

The five, including former Gen Re CEO Ronald Ferguson and AIG Reinsurance VP Christian Milton, were convicted last year after pleading not guilty to conspiracy charges regarding the deal.

They were later sentenced to prison terms of up to two years and fines of up to $US250,000 ($314,000).

A second executive to plead guilty to conspiracy charges, former Gen Re Senior VP Richard Napier, is awaiting sentencing.