Fillon, who was previously leading the race as the right-wing standardbearer, will be investigated by three magistrates over allegations of embezzling public funds and misappropriating corporate assets, prosecutors said yesterday.
The 62-year-old former prime minister has already been the subject of a preliminary probe. An editorial in Le Parisien newspaper today said the move to a full investigation represented a "surge in the pressure" on Fillon.
With the first round of the election set for April 23, the timing of the magistrates' decision could have a significant bearing on the outcome.
Far-right National Front leader Marine Le Pen has been bolstered by the scandal and has overtaken Fillon in the polls over the past month.
But Le Pen is facing her own expenses scandal, and today news broke that a close confidant had been charged in a separate matter with making an illegal loan to her party.
The latest surveys before the prosecutors' decision on Fillon showed he had regained ground and was neck-and-neck with 39-year-old centrist candidate Emmanuel Macron in second place.
The devout Catholic won the conservative nomination by campaigning as a "clean" candidate unsullied by the scandals of his rivals.
But since January he has been fighting claims by Le Canard Enchaine newspaper that he used allowances to pay his British-born wife Penelope at least 680,000 euros (USD 720,000) over some 15 years as a parliamentary aide.
Although French lawmakers are allowed to employ family members, it is unclear what work Penelope did and she did not have a pass to the National Assembly building.
The Canard Enchaine has alleged Fillon's wife was also paid tens of thousands of euros by a literary review, the Revue des Deux Mondes, owned by her husband's billionaire friend, Marc Ladreit de Lacharriere.
Magistrates will investigate whether this amounts to misappropriation of corporate assets.
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