Sarkozy charged with passive corruption over Gaddafi funding claims
Sarkozy was held in custody on Tuesday and has now been charged with corruption, illegal campaign financing and concealment of Libyan money, according to AFP.
AP reported that the former French president was charged with illegally funding a campaign, passive corruption and receiving money from Libyan embezzlement.
Passive corruption is classed as "corruption initiated by the corrupted party".
Anti-corruption investigators are exploring claims that a middle man transferred funds from the Libyan regime in Tripoli to Sarkozy's campaign team in Paris in suitcases stuffed with cash during the 2007 election battle.
Sarkozy has denied the claims but the new charges are the most serious yet against the former French president.
He was held at a police station in Paris overnight and questioned for a second day by investigotors on Wednesday. Sarkozy denies the allegations.
Sarkozy accused of accepting a 50 million euro ($62 million) donation from Gaddafi during the 2007 French elections.
France has a 21 million euro spending limit for elections strict rules on foreign donations.
"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," Saif told Euronews at the time.
"The first thing we're demanding is that this clown gives back the money to the Libyan people."
Franco-Lebanese businessman Ziad Takieddine also said he made three trips to Paris from Tripoli with suitcases stuffed with cash between 2006 and 2007.
The former French president has rejected the claims saying the Gaddafis are bitter about being overthrown by rebels with French assistance in 2011.
Agencies contributed to this story.