The former French president Nicolas Sarkozy has been placed under formal investigation for illegal campaign financing, accepting bribes and the misappropriation of Libyan state funds over allegations that he received millions of euros in illegal election campaign funding from the regime of the late Libyan dictator Muammar Gaddafi.
Sarkozy, France’s rightwing president from 2007 to 2012, was released on bail on Wednesday after two days of questioning in police custody by investigators specialising in corruption, money laundering and tax evasion as part of an inquiry into whether Gaddafi and others in Libya illegally financed his successful election campaign in 2007.
The investigation is potentially France’s most explosive political financing scandal in decades. The allegations of illegal campaign funding by a foreign dictator on a massive scale are unprecedented and are the most serious accusations levelled at a former president in recent French history. Sarkozy has repeatedly denied the allegations, dismissing the claims as “grotesque”.
Under French law, being put under formal investigation means there is “serious or consistent evidence” that points to probable involvement in a crime. It is a step toward a trial but investigations can be dropped without proceeding to court.
The former president, 63, was allowed home on Wednesday night under bail conditions.
The two-day questioning is the first time Sarkozy has faced police in the case. A French inquiry into alleged illegal campaign funding from Libya was opened in 2013. The inquiry did not name anyone as a suspect, and has centred on claims of corruption, influence trafficking, forgery, abuse of public funds and money laundering.
Investigators are examining claims that Gaddafi’s regime secretly gave Sarkozy €50m overall for the 2007 campaign. Such a sum would be more than double the legal campaign funding limit, which was €21m at the time. The alleged payments would also violate French rules against foreign financing and declaring the source of campaign funds.
In April 2012, the investigative website Mediapart published a document it said was signed by a senior Libyan figure stating the regime approved a payment of €50m to “support” Sarkozy’s election campaign.
Previously, Sarkozy and Claude Guéant, a close ally and former minister, claimed the documents were false. A French court later declared that certain documents were authentic, allowing them to be used in the investigation.
Guéant has been officially put under investigation for organised fraud in the Gaddafi inquiry after allegedly receiving a bank transfer of €500,000, which he claimed had come from the sale of two paintings.
Sarkozy had until now refused to respond to a summons for questioning in the case.
The investigation appeared to accelerate after Ziad Takieddine, a wealthy French-Lebanese businessman who was close to Gaddafi’s regime, told Mediapart in 2016 that he had personally delivered suitcases stuffed with cash from the Libyan leader as payments towards Sarkozy’s campaign.
He said he made three trips from Tripoli to Paris in late 2006 and early 2007. Each time he carried a suitcase containing €1.5m to €2m in €200 and €500 notes, he claimed, saying he was given the money by Gaddafi’s military intelligence chief.
Sarkozy had a complex relationship with Gaddafi. Soon after becoming the French president, he invited the Libyan leader to France for a state visit and welcomed him with high honours. But Sarkozy then put France in the forefront of Nato-led airstrikes against Gaddafi’s troops that helped rebel fighters topple his regime in 2011.
In March 2011, Gaddafi’s son Saif al-Islam Gaddafi told Euronews: “Sarkozy has to give back the money he accepted from Libya to finance his electoral campaign. We financed his campaign and we have the proof … The first thing we’re demanding is that this clown gives back the money to the Libyan people.”
Sarkozy has dismissed the allegations as the claims of vindictive Libyan regime members furious over his participation in the US-led military intervention that ended Gaddafi’s 41-year rule.
Lawyers for Sarkozy have not commented on his questioning.
Another former minister and close ally of Sarkozy, Brice Hortefeux, was also questioned by police on Tuesday in relation to the allegations.
In January, Alexandre Djouhri, a French businessman suspected by investigators of funnelling money from Gaddafi to finance Sarkozy’s campaign, was arrested in Britain and granted bail after he appeared in a London court.
Djouhri was returned to pre-trial detention in February after France issued a second warrant for his arrest, ahead of a hearing scheduled for later in March.
Sarkozy has already been ordered to stand trial in a separate matter concerning financing of his failed re-election campaign in 2012, when he was defeated by François Hollande. That case, known as the “Bygmalion affair”, centres on an alleged system of false accounting used by Sarkozy’s office to conceal an enormous campaign overspend, mainly on the lavish rallies and US-style stadium gigs that cemented Sarkozy’s reputation as a political showman. Sarkozy has denied all allegations.