The French government announced plans to ban lawmakers from hiring family members, one of a raft of measures aimed at cleaning up politics after a slew of scandals.
Justice Minister Francois Bayrou said the government aimed to restore confidence in politicians, which was severely rattled by revelations over the alleged fake parliamentary job that conservative MP Francois Fillon gave his wife.
The presidential campaign was troubled by a major scandal surrounding conservative candidate Francois Fillon. Prosecutors started investigating allegations that Fillon's family benefited from cushy taxpayer-funded jobs they allegedly didn't do.
French prosecutors said they had launched a preliminary investigation into a 2011 property deal involving Richard Ferrand, a minister who is a key ally of President Emmanuel Macron. The decision came hours before Justice Minister Francois Bayrou was due to announce details of a planned law toughening ethical standards for politicians, one of Macron's key manifesto commitments. The affair risks embarrassing Macron ahead of legislative elections scheduled for June 11 and 18.
Macron's La Republique en Marche! (The Republic on the Move) party, of which Ferrand is secretary general, is seeking a majority to enable the president to push through his reform program. Ferrand has been under fire over the deal, in which a health insurance association headed by him rented out a property from his partner.
He has repeatedly defended his actions, saying that the deal with his partner was the best of three offers presented to the Mutuelles de Bretagne insurance fund.
Eric Mathais, state prosecutor for Brest, said the investigation would seek to establish the full facts surrounding the deal and determine whether they might involve any contravention of the law.
On Monday, newspaper Le Parisien alleged that Ferrand had been involved in negotiations for his partner to buy the property from its previous owner ahead of the rental deal.
The insurance association's notary, Anne-Sophie Queinnec, defended the arrangement to regional newspaper Le Telegramme.
Ferrand had acted so that Mutuelles de Bretagnes would not lose its chance to rent the property, whose owner was being pursued by creditors, she said. Ferrand himself on Wednesday dismissed arguments that the fund should have bought the property outright itself rather than renting it. "Care networks like that have no interest in using their funds in real estate," he told broadcaster Patrick Cohen. "If the question is whether or not I am an honest man, yes, I am an honest man," he insisted. "I saved an enterprise where 130 jobs were at risk and created another 250."
Government spokesman Christophe Castaner welcomed the prosecutor's decision, saying that "if it confirms or denies [suspicion over the deal], it will enable a decision to be taken."
"The prime minister has laid down the rule," Castaner told broadcaster LCI: "If Richard Ferrand is implicated, if he is placed under formal investigation, he will immediately be removed from office."
Macron, in addition to his promised political ethics legislation, requested authorities to check his prospective ministers' ethical and tax affairs before appointing them.