The investigation was opened in June after a government report revealed that Guéant received 10,000 euros ($13,780) in cash each month from the police budget between 2002 and 2004, when he acted as then-interior minister Sarkozy’s chief of staff.
The country’s ex-director general of the national police, Michel Gaudin, was also held for questioning alongside Guéant, the judicial source said. The pair are being interrogated by police from a special anti-corruption and financial crimes unit and can be detained for up to 48 hours.
Sources close to Guéant have said that the cash was not for personal or political use, but rather to pay special bonuses to officers assigned to ensure Sarkozy’s personal protection, under a longstanding tradition.
Guéant, who worked on Sarkozy’s first presidential campaign and also served as one of his chief advisors at the Elysée, eventually went on to occupy his boss’ old position as interior minister from 2011 until 2012. He left the office after Sarkozy lost his re-election bid to Socialist François Hollande.
It is far from the first time that Guéant has found himself mired in scandal. Earlier this year, he was thefocus of an investigation into allegations that Sarkozy had received illegal campaign contributions from former Libyan leader Muammar Gaddafi during his 2007 run for the presidency. Guéant has categorically denied the allegations.