Nicolas Sarkozy aides Claude Guéant and Michel Gaudin arrested in connection with alleged embezzlement of police funds

They were arrested as part of an investigation into an undeclared €10,000 in cash paid monthly to Mr Guéant when he ran Mr Sarkozy's office

Paris

The tangled mesh of legal investigations surrounding Nicolas Sarkozy and his clan tightened on Tuesday with the arrest of two of the former president's closest associates.

A former interior minister and a former Paris police chief were in custody on Tuesday night suspected of involvement in the embezzlement of police funds.

One of the two men, Michel Gaudin, 65, ex-prefect of the Paris police, is now head of former President Sarkozy's  private office. The other man, Claude Guéant, 68, was Mr Sarkozy's alter-ego for a decade, rising from his right-hand man in the interior ministry to become interior minister himself.

They were arrested by appointment on Tuesday morning as part of an investigation into an undeclared €10,000 in cash paid monthly to Mr Guéant from 2002 to 2004 when he ran Mr Sarkozy's private office in the interior ministry (equivalent of the Home Office).

The money came from a fund which was supposed to be used for special police surveillance and investigation operations. Mr Guéant initially admitted that he had received the money but said that this was part of a long-standing tradition of under-the-counter cash bonuses for senior officials in ministerial offices. His friends later claimed that the money had been paid as bonuses to police officers in Mr Sarkozy's personal security team.

Neither man has yet been formally accused of any offence but they could be "mis en examen" - or placed under formal investigation - at the end of up to two days of questioning by a police unit which deals with corruption and tax avoidance.

The arrests will infuriate Mr Sarkozy, who has complained in private that both he and his closest associates have been persecuted by the French police and judicial  system since he lost power 20 months ago. Mr Guéant's name has come up in half a dozen separate investigations into allegations of illegal political fund-raising, misuse of power and the undeclared sale of art-works.

The potential allegations against Mr Guéant of tax-avoidance or embezzlement in the interior ministry a decade ago could be especially embarrassing for Mr Sarkozy. The former President's rise to power was based on his carefully constructed image  as a man tough on crime while he was minister for the interior under President Jacques Chirac in 2002-4.

Police are now investigating whether Mr Sarkozy's closest aide at the time was taking illegal, cash bonuses of up to €120,000 a year - almost double his official salary - from funds which were supposed to be used for crime-fighting.

Mr Gaudin's alleged role remained unclear on Tuesday night. After hitching his career to the rise of Mr Sarkozy, he was made prefect (chief) of the Paris police soon after his mentor's election to the presidency in May 2007 and dismissed just after Francois Hollande's election in May 2012. He has since become the head of Mr Sarkozy's post-presidential private office. 

The allegations arise from documents found at Mr Guéant's home and office during police searches last year connected with the other investigations against him. Asked to explain several large cash purchases in this period, he said that the money came from his bonuses at the interior ministry.

Such cash bonuses, common for decades, were abolished by President Chirac and the Socialist prime minister, Lionel Jospin in 2002. In a radio interview in May this year, Mr Guéant said he made the purchases with “bonuses paid in cash. They weren’t declared (to the tax authoritoies) because that was the custom at the time. Now, after the event,  it is said to be irregular and the rules have been changed.”

Start your day with The Independent, sign up for daily news emails
News
people
Arts and Entertainment
Attenborough with the primates
tvWhy BBC producers didn't want to broadcast Sir David Attenborough's famed Rwandan encounter
Sport
The RBS Six Nations trophy at the Aviva Stadium ahead of Ireland vs England
rugby
News
Campbell: ‘Sometimes you have to be economical with the truth’
newsFormer spin doctor says MPs should study tactics of leading sports figures like José Mourinho
ebooks
ebooksA special investigation by Andy McSmith
Arts and Entertainment
Kanye West found himself at the centre of a critical storm over the weekend after he apparently claimed to be “the next Mandela” during a radio interview
music
Sport
Wes Brown is sent-off
football
Voices
Lance Corporal Joshua Leakey VC
voicesBeware of imitations, but the words of the soldier awarded the Victoria Cross were the real thing, says DJ Taylor
Life and Style
Alexander McQueen's AW 2009/10 collection during Paris Fashion Week
fashionMeet the collaborators who helped create the late designer’s notorious spectacles
News
i100
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Recruitment Genius: Bookkeeper / Office Co-ordinator

£9 per hour: Recruitment Genius: This role is based within a small family run ...

Recruitment Genius: Designer - Print & Digital

£28000 - £32000 per annum: Recruitment Genius: This Design and marketing agenc...

Recruitment Genius: Quantity Surveyor

£46000 per annum: Recruitment Genius: This property investment firm are lookin...

Recruitment Genius: Telesales / Telemarketing Executive - OTE £30k / £35k plus

£18000 - £35000 per annum: Recruitment Genius: This company specialises provid...

Day In a Page

War with Isis: Fears that the looming battle for Mosul will unleash 'a million refugees'

The battle for Mosul will unleash 'a million refugees'

Aid agencies prepare for vast exodus following planned Iraqi offensive against the Isis-held city, reports Patrick Cockburn
Yvette Cooper: We can't lose the election. There's too much on the line

Yvette Cooper: We can't lose the election. There's too much on the line

The shadow Home Secretary on fighting radical Islam, protecting children, and why anyone in Labour who's thinking beyond May must 'sort themselves out'
A bad week for the Greens: Leader Natalie Bennett's 'car crash' radio interview is followed by Brighton council's failure to set a budget due to infighting

It's not easy being Green

After a bad week in which its leader had a public meltdown and its only city council couldn't agree on a budget vote, what next for the alternative party? It's over to Caroline Lucas to find out
Gorillas nearly missed: BBC producers didn't want to broadcast Sir David Attenborough's famed Rwandan encounter

Gorillas nearly missed

BBC producers didn't want to broadcast Sir David Attenborough's famed Rwandan encounter
Downton Abbey effect sees impoverished Italian nobles inspired to open their doors to paying guests for up to €650 a night

The Downton Abbey effect

Impoverished Italian nobles are opening their doors to paying guests, inspired by the TV drama
China's wild panda numbers have increased by 17% since 2003, new census reveals

China's wild panda numbers on the up

New census reveals 17% since 2003
Barbara Woodward: Britain's first female ambassador to China intends to forge strong links with the growing economic superpower

Our woman in Beijing builds a new relationship

Britain's first female ambassador to China intends to forge strong links with growing economic power
Courage is rare. True humility is even rarer. But the only British soldier to be awarded the Victoria Cross in Afghanistan has both

Courage is rare. True humility is even rarer

Beware of imitations, but the words of the soldier awarded the Victoria Cross were the real thing, says DJ Taylor
Alexander McQueen: The catwalk was a stage for the designer's astonishing and troubling vision

Alexander McQueen's astonishing vision

Ahead of a major retrospective, Alexander Fury talks to the collaborators who helped create the late designer's notorious spectacle
New BBC series savours half a century of food in Britain, from Vesta curries to nouvelle cuisine

Dinner through the decades

A new BBC series challenged Brandon Robshaw and his family to eat their way from the 1950s to the 1990s
Philippa Perry interview: The psychotherapist on McDonald's, fancy specs and meeting Grayson Perry on an evening course

Philippa Perry interview

The psychotherapist on McDonald's, fancy specs and meeting Grayson Perry on an evening course
Bill Granger recipes: Our chef recreates the exoticism of the Indonesian stir-fry

Bill Granger's Indonesian stir-fry recipes

Our chef was inspired by the south-east Asian cuisine he encountered as a teenager
Chelsea vs Tottenham: Harry Kane was at Wembley to see Spurs beat the Blues and win the Capital One Cup - now he's their great hope

Harry Kane interview

The striker was at Wembley to see Spurs beat the Blues and win the Capital One Cup - now he's their great hope
The Last Word: For the good of the game: why on earth don’t we leave Fifa?

Michael Calvin's Last Word

For the good of the game: why on earth don’t we leave Fifa?
HIV pill: Scientists hail discovery of 'game-changer' that cuts the risk of infection among gay men by 86%

Scientists hail daily pill that protects against HIV infection

Breakthrough in battle against global scourge – but will the NHS pay for it?