Ex-president Nicolas Sarkozy told judges he received no money from France's richest woman Liliane Bettencourt, a newspaper said, amid allegations that his 2007 election campaign was illegally financed.
"I have known the Bettencourts for 28 years and I am 57... They have never given me a sou (cent) and I have never asked them," Sarkozy said during a 12-hour hearing in front of investigating magistrates in the southern city of Bordeaux on Thursday, the Sud Ouest daily reported.
Sarkozy escaped indictment but will continue to be investigated over the allegations after the panel of three examining magistrates decided Thursday to treat him as a witness under caution rather than formally charging him.
The newspaper report was the first to quote him from the written transcript of the confidential enquiry session.
The judges' decision will allow the former leader to retain hope he will eventually be exonerated of accusations he denies. But it also means the magistrates believe there are grounds for further investigation, a stance that deals a significant blow to Sarkozy's hopes of staging a political comeback.
Former French president Nicolas Sarkozy leaves a Bordeaux courthouse in a car on November 22, 2012 at the end of a twelve-hour interrogation by the investigating judges, to respond to charges that his 2007 electoral campaign was financed with funds secured illegally from France's richest woman, Liliane Bettencourt.
The conviction last year of his predecessor Jacques Chirac on corruption charges related to his time as mayor of Paris demonstrated that French courts are willing to go after former leaders.
Sarkozy, was quoted as saying in his Bordeaux testimony that "in 36 years of political life, this is the first time that I have been brought before examining magistrates" and that "it's an ordeal".
Sarkozy's lawyer, Thierry Herzog, has said he hopes the judges will now leave his client in peace.
Sarkozy, who is married to former supermodel Carla Bruni, won international acclaim as the principal architect of last year's military campaign against Libyan dictator Moamer Kadhafi.
But since losing to Francois Hollande in the presidential election earlier this year, he has had to battle a string of allegations relating to his time in office and various electoral campaigns he has been involved in.
Policemen stand guard in front of the Bordeaux courthouse where former French president Nicolas Sarkozy appeared before an examining magistrate to respond to charges that his 2007 electoral campaign was financed with funds secured illegally from France's richest woman. He denied the allegation, a report said.
The suspicion at the centre of Thursday's interrogation is that he took financial advantage of elderly L'Oreal heiress Bettencourt when she was too frail to fully understand what she was doing.
In his comments on Thursday, the Sud Ouest reported, Sarkozy said he had noticed "no apparent sign" of mental fragility on her part.
"When I see her she was well-dressed, she doesn't slur her words. She says nothing implausible," Sarkozy was quoted as saying.
Bettencourt is now 90 and has been in poor health since 2006. Sarkozy, it is alleged, obtained significant amounts of money from her for his 2007 campaign, simultaneously breaching electoral spending limits and taking advantage of a person weakened by ill health.
Bettencourt's former accountant, Claire Thibout, told police in 2010 that she had handed envelopes stuffed with cash to Bettencourt's right-hand man, Patrice de Maistre, on the understanding it was to be passed on to Sarkozy's campaign treasurer, Eric Woerth.
A file picture taken on October 12, 2011 shows the L'Oreal heiress Liliane Bettencourt leaving the Institut de France in Paris. Ex-president Nicolas Sarkozy told judges he received no money from France's richest woman, amid allegations that his 2007 election campaign was illegally financed.
Investigators suspect up to four million euros ($5.2 million) of Bettencourt's cash subsequently made its way into Sarkozy's party coffers.
Sarkozy, who lost his immunity from prosecution after losing to Hollande, is embroiled in a string of scandals with legal repercussions.
As well as the Bettencourt case, he faces probes into contracts for opinion polls, an illegal police investigation into journalists and alleged kickbacks on a Pakistani arms deal used to finance the right in 1995, when Sarkozy was budget minister.
He has always denied any wrongdoing and has not ruled out another tilt at the presidency in 2017 amid signs that his party, the UMP, is on the point of disintegration.
A vote intended to produce a new leader for the centre-right party descended into chaos this week with ex-prime minister Francois Fillon contesting the result of a poll edged by party secretary-general Jean-Francois Cope.
With the party split down the middle, many party activists are calling for Sarkozy to return to the fray, but Thursday night's ruling suggests he might be otherwise engaged for some time to come.