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PARIS (Reuters) - French President Emmanuel Macron's pledge of clean leadership hit another snag on Tuesday when a second minister in his government had to deny accusations by political opponents of financial misconduct days before parliamentary elections.
Such scandals hurt Macron's rivals in his campaign for the presidency and helped him defeat the far-right National Front's Marine Le Pen on May 7.
Richard Ferrand, the new minister for housing and a close ally of Macron, has been fighting for a week against charges of improper financial dealings six years ago when he managed a health insurance fund in the Brittany region.
Ferrand, who denies wrongdoing and has rejected calls for his resignation, issued a statement on Tuesday carrying a point-by-point rebuttal of allegations published by Le Monde.
Prime Minister Edouard Philippe said late on Tuesday that Ferrand would stay in the government and that it would lay clear rules on ethics for politicians in a draft law on June 14.
"I say yes (for Ferrand to stay) after having perfectly understood...the exasperation of the French, given the successive accusations which give the impression that elected officials are never as honest as they are expected to be," Philippe told France 2 television.
Also on Tuesday, Macron's junior minister for European affairs, Marielle de Sarnez, issued a statement saying she had done nothing wrong in hiring an assistant for her work as a Member of the European Parliament (MEP), among 19 French MEPs in all that prosecutors said were being investigated.
She also said she planned to sue the person behind the allegations - a member of the National Front - on the grounds that the accusations were slanderous.
The allegations come less than two weeks from a two-round vote, on June 11 and 18, where the centrist Macron hopes his Republic on the Move party will win control of parliament to consolidate power after his presidential win over Le Pen.
De Sarnez denied wrongdoing as French prosecutors said they had opened a preliminary inquiry into the allegations concerning assistants hired to help her and other French MEPs.
Le Pen is herself the target of a separate judicial inquiry into accusations she and her party put assistants on the payroll of the European Parliament when they were actually working on national constituency matters and not European assembly duties.
Sophie Montel, a National Front politician, said she filed the request for an inquiry after speaking to Le Pen, whose bid for president, she said, had been hurt by similar inquiries.
De Sarnez defended her action, saying her assistant, who is now part of her ministerial support team, had been registered and vetted by the European Parliament at the time in question.
A source in the prosecutor's office said the matter was, at present, a procedural one where a preliminary inquiry is opened to assess whether there are grounds for deeper investigation.
The sleaze accusations come at a sensitive time for Macron.
He is tipped by pollsters to win a majority in the 577-seat National Assembly, the lower house of parliament, after sweeping to power promising a non-partisan government that would bring in laws to break the mould of past governance in France and curb corruption in the corridors of power.
In the Ferrand case, a media report said that he rented office space from his female partner from 2011 for a health insurance fund he managed. The newspaper, Le Canard Enchaine, also said Ferrand employed his son as his parliamentary assistant for several months in 2014.
In addition to these allegations, Le Monde said on Tuesday that Ferrand, who directed Macron's election campaign, had hung on to a remunerative post with the insurance fund in Brittany for some time after formally leaving the job.
It also said he had shown favouritism to the male friend of a woman colleague by taking him on as a parliamentary assistant.
Le Monde said too that his support for a draft law on the functioning of health insurance funds, while he himself was working for one of them, showed a "troubling mix" of private interest and public life.
Ferrand hit back, saying in a statement: "I deny and denounce all the implicit suspicions in this article."
The allegations have the whiff of the sort of scandal which enveloped - and eventually doomed - the presidential bid of conservative Francois Fillon.
Once the frontrunner, Fillon was hit months before voting day by media reports that he paid his wife and family from parliamentary funds for little or no work. Though he denounced what he called pre-election mud-slinging, he was eliminated early in the race.
Additional reporting by Marine Pennetier and Maya Nikolaeva; writing by Brian Love and Richard Balmforth; editing by Louise Ireland/Mark Heinrich