The court of appeal in French Polynesia has upheld a one-year suspended jail sentence given by a lower court to the veteran politician, Gaston Flosse, for misusing public funds following the 2004 general election night.
He has also been fined 12,000 US dollars.
The verdict has also declared him ineligible for public office for a year.
It is not clear if the sentence will be suspended in the case of an appeal to France's top court.
Flosse, who was the territory's president, organised a massive reception for his Tahoeraa Huiraatira Party at the presidential palace on election night, assuming he would increase his majority and win another five-year term.
After his shock defeat, the entertainment bill was left for the new government to pay but the new administration of Oscar Temaru refused to do so.
Once back in power, Mr Flosse settled the account and Mr Temaru lodged a complaint, saying the election night party was not to be funded by the taxpayer.