NEW YORK (CNNMoney.com) -- The Securities and Exchange Commission said Monday it agreed to settle insider trading charges against Martha Stewart and her former stockbroker relating to Stewart's sale of ImClone Systems stock in December 2001.

Under the settlement, Stewart agreed to the maximum penalty of about $195,000, or three times the losses she avoided, the SEC said.

Stewart also agreed to a five-year bar from serving as a director of a public company and a five-year limitation on the scope of her service as an officer or employee of a public company, according to the SEC.

Stewart will be prohibited from participating in financial reporting, financial disclosure, internal controls, audits, SEC filings and monitoring compliance with the federal securities laws.

"This brings closure to a personal matter and my personal nightmare has come to an end," Stewart said in a statement.

Martha Stewart Living (Charts) also issued a statement expressing the company's happiness that the suit was resolved. "The settlement allows Martha to continue in her role as founder and as the creative force behind the brand," the company said.

Peter Bacanovic, the former Merrill Lynch broker who regulators contend fed Stewart privileged information that other large investors were selling their ImClone shares, agreed to pay $75,000 and was barred from associating with a broker, dealer or investment adviser.

"This settlement, in which Mr. Bacanovic does not admit or deny the allegations, concludes this painful matter for him," Bacanovic's lawyer Rich Strassberg said.

Both Stewart and Bacanovic consented to the judgments without admitting or denying the allegations in the complaint.

"This settlement achieves everything we sought to accomplish in pursuing this case. The combination of monetary relief and future professional restrictions serve both to sanction the defendants' insider trading and to restrict them from future positions of investor trust," Mark Schonfeld, director of the SEC's Northeast regional office, said in a statement.

In 2004, Stewart was convicted on charges of conspiracy, obstruction of justice and making false statements stemming from her sale of almost 4,000 shares of ImClone stock before bad news about one of its products drove the stock sharply lower. Bacanovic was convicted on four of five counts against him.

Stewart served five months in prison and nearly six months of house arrest starting in October 2004.

Momentum for Martha

More on the civil suit