Robert Graham, 61, of Westport, CT, will also have to serve two years' supervised release after the prison time and pay a $100,000 fine. He had faced up to life in prison and a fine of up to $46 million.
Graham, who was senior vice president and assistant general counsel at Stamford-based General Re from 1986 to 2005, will remain free on bond pending appeal. His lawyer, Alan Vinegrad, had sought a period of home confinement and community service.
"Nothing I can say or do now can change what has happened or its impact on the lives of others or on me," Graham told U.S. District Judge Christopher Droney. "Your honor, I regret that more than words can adequately express."
Graham, one of five former executives charged in the case, said he was proud of having developed a reputation for honesty and integrity during three decades as a lawyer.
"That's all gone now," he said. "Instead of my career and reputation as a lawyer serving as a good example to others, as a disgraced and disbarred lawyer they will now serve only as a cautionary tale."
Federal prosecutors say New York-based AIG paid Stamford-based Gen Re in a secret deal to take out reinsurance policies with AIG in 2000 and 2001. They say the scheme propped up AIG's stock prices and inflated reserves by $500 million with the goal of quelling criticism by analysts and easing concerns by investors.
Reinsurance policies are purchased by insurance companies to completely or partly insure the risk they assume for their customers.
Graham was the last of five defendants to be sentenced after being convicted last year of conspiracy, securities fraud, making false statements to the Securities and Exchange Commission and mail fraud following a five-week trial.