Bonn public prosecutors agreed to formally suspend a criminal fraud investigation into former German Chancellor Mr Helmut Kohl on condition he paid the court DM300,000 (£121,000).
The announcement confirms a report from Mr Kohl's lawyer last month which said Bonn prosecutors would drop the 14-month criminal inquiry into secret cash donations Mr Kohl accepted while in power.
Under German legal procedure prosecutors and those investigated can agree a payment be made into court before charges are even been brought.
The payment leaves the suspect without a criminal record as there is no admission of guilt and no conviction of any offence.
While Mr Kohl's reputation as a major European statesman has been tarnished by the slush fund scandal that plunged his Christian Democratic Union (CDU) into crisis the ending of the investigation means he will not face trial.
Mr Kohl admits to having broken party funding rules by accepting payments from anonymous donors during the 1990s but rejects allegations he was open to bribery or defrauded his party. He refuses to names his donors.
He is also under a separate parliamentary investigation into whether the donations constituted bribes. He denies they do.
