A Manhattan US Attorney sending out grand jury subpoenas to several Bermuda reinsurance companies in recent weeks announced that he is quitting public life.

David Kelley, the US Attorney for the Southern District of New York, will go into private practice, joining Cahill Gordon & Reindel as a senior litigating partner, the company said in a statement on Wednesday.

Mr. Kelley, 45, is due to retire from public service by or before Labour Day, 5 September. He leaves his post after prosecuting some of those behind a run of headline crimes, including the conviction of Martha Stewart after suspicious trading of ImClone Systems Inc. stock, Bernie Ebbers for the massive bankruptcy of MCI WorldCom and the indictment of 15 current and past New York Stock Exchange specialists.

In June, Mr. Kelley sent out subpoenas to a number of insurance and reinsurance companies in a widening probe of finite risk reinsurance, a type of policy insurers might use to mask losses. Among those getting the federal request to provide documents were Bermuda companies ACE Limited, PartnerRe, Platinum Underwriters Holdings Ltd., RenaissanceRe and XL Capital.

A former US Attorney, Mary Jo White, turned to helping companies with internal reviews into areas she may have, at one time, investigated as a federal prosecutor.

ACE Limited hired Ms White to lead its internal review after alleged collusion between a few ACE employees and the brokers ACE paid to find customers for the commercial insurance and reinsurance policies it sells. An ACE employee pleaded guilty to a misdemeanour charge in a regulatory investigation of broker practices led by New York Attorney General Eliot Spitzer.

Immanuel Kohn, chairman of Cahill Gordon & Reindel's executive committee said: "As a widely respected and accomplished prosecutor, David has a successful track record conducting investigations and litigating complex cases covering business and white collar crime, securities fraud, terrorism and organised crime."

Mr. Kelley took up the U.S. Attorney post in December 2003. It was always thought that his appointment as the the top federal prosecutor would be short term, as he was a Democrat and the Republican administration would likely move to appoint one of their own.

Mr. Kelley will be succeeded by Michael J. Garcia, the head of the Immigration and Customs Enforcement agency in the US Department of Homeland Security.