Andrew M. Calamari, SEC Northeast Regional Office associate director, said the injunction in part barred Mr. Merritt from acting as an officer or director of a public company. He said a monetary component would be settled at a later time.

Mr. Calamari could not say exactly what the defendants' exposure is, but conviction on the charges can result in a penalty of $100,000-to-$120,000 per violation, with the number of violations subject to legal interpretation. He said that "hundreds of thousands" is involved.

"This is another case arising from our ongoing investigation of the misuse of finite reinsurance to commit securities fraud," said Mark K. Schonfeld, SEC Northeast Regional Office director. "The defendants enabled RenRe to take excess revenue from one good year and, in effect, 'park' it with a counterparty so it would be available to bring back in a future year when the company's financial picture was not as bright."

Mr. Stanard, a resident of Maryland and Bermuda, resigned as RenRe's chairman and CEO last November. He joined the firm in 1993.

According to the SEC, Mr. Merritt and Mr. Cash used two contracts to create "a round trip of cash."

In the first contract, RenRe purported to assign, at a discount, $50 million of recoverables due to RenRe under certain industry loss warranty contracts to Inter-Ocean Reinsurance Company Ltd., in exchange for $30 million in cash, for a net transfer to Inter-Ocean of $20 million.

The SEC said RenRe recorded income of $30 million upon executing the assignment agreement, while the remaining $20 million of its $50 million assignment became part of a "bank" or "cookie jar" that RenRe used in later periods to bolster income.

The second contract, according to the SEC, was a purported reinsurance agreement with Inter-Ocean that was, in fact, a vehicle to refund to RenRe the $20 million transferred under the assignment agreement, plus the purported insurance premium paid under the reinsurance agreement.

According to the SEC, the reinsurance agreement was "a complete sham." Not only was RenRe certain to meet the conditions for coverage, it also would receive back all of the money paid to Inter-Ocean under the agreements, plus investment income earned on the money in the interim--less transactional fees and costs.

RenRe accounted for the sham transaction as if it involved a real reinsurance contract that transferred risk from RenRe to Inter-Ocean when, in fact, the complaint alleges, each of these individuals knew that this was not true.

The two RenRe execs were also said to have misrepresented or omitted key facts about the transaction to RenRe's auditors.

As a result of RenRe's accounting treatment for this transaction, RenRe materially understated income in 2001 and materially overstated income in 2002, at which time it made a "claim" under the "reinsurance" agreement.

It then received as apparent reinsurance proceeds the funds it had paid to Inter-Ocean and that Inter-Ocean held in a trust for RenRe's benefit.

Mr. Stanard, the SEC charged, signed an annual 10K report to the commission last year, containing misleading statements about the reason the firm was restating its results for 2001, 2002 and 2003.

An attorney for Mr. Cash, Martin Pershetz, issued a statement that his client denied the SEC charges, was not responsible for RenRe financial statements, and "should not have been named as a defendant in this case."

RenRe noted that the executives involved had left the company in 2005, adding that "the company believes these developments will have no impact on the company's business going forward."