#I myself prefer Peter dying in the prison coz this whole idea is gonna be really traumatic to Harry if he'll ever find out

[stop-ugly]

AU where after Potter's death Sirius was able to capture Peter and get him to the Ministry. So Black is not a suspect and is Harry's guardian. Wolfstar raise Harry BUT! Let's get back to Peter. They tell the Ministry he's an Animagus and sneaky one and can escape. But Remus and Sirius didn't want their ex-friend to be kissed by Dementor, it's both too cruel and too merciful. That's why they came up with a plan. As a punishment for Peter's crimes the Ministry made him transform into his Animagus form and after that completely erased his memory.

Peter became Harry's rat with no memory of his human life and spent the rest of it as a pet, being not able to harm anyone and entertaining the boy he deprived of his parents.