Lord Watson, a former Labour MP, was jailed for 16 months in September 2005 after setting fire to curtains in a hotel during a drunken incident.
However, he was released from prison early in May 2006 and has since claimed up to £308 a day in House of Lords expenses while on probation.
The disclosure will add to the growing pressure for Lords reform to stop convicted criminals and those found to have broken Parliamentary rules from continuing to sit as peers.
Since leaving prison, Lord Watson has claimed a total of about £100,000 in expenses despite voting on only about a quarter of the days he was attending. He has spoken only five times in the past year and has not put down a single written question.
The peer is also a director of a Scottish-based public-affairs company offering "parliamentary monitoring" services. His profile on the firm's website boasts he is a "regular attender at the House of Lords".
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