Englishman Arscott, who has played for Plymouth Albion, Bristol, Worcester Warriors, London Welsh, Sale Sharks and Yorkshire Carnegie during his career, arrives from Rouen for the 2018/19 campaign.
The 30-year-old left the Premiership under a huge cloud in 2017 after his contract with Sale was terminated following an investigation that found him guilty of leaking confidential team information to Bristol.
Arscott, who plays on the wing or at fullback, always said he was desperate to return to England's top flight and he revealed his delight after being handed the opportunity by the Falcons.
"It's a league I always wanted to return to, and I feel I have something to offer Newcastle," he said. "With the way things were left at Sale Sharks I was desperate to get the opportunity come back to the Premiership and prove myself a little bit, and thankfully Dean has given me that chance.
"Newcastle are having an awesome season on the back of an encouraging one the year before, the club is going in the right direction and I've enjoyed watching their games on the TV from over in France."