Mr Peel, who joined the Financial Times in 1996, replaces Bob Sherwood who is now FT's London and South East correspondent.
His new role will involve reporting on the UK's criminal and civil justice system and other legal issues on corporate and civil life.
Managing editor Dan Bogler said: "We are delighted that Michael, with his experience in financial and accounting matters as well as a strong background in investigative reporting, has rejoined the FT as its legal correspondent."
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