François Fillon, the right-wing French presidential candidate, is to be the subject of a full judicial inquiry over allegations that he paid family members for fake parliamentary assistant jobs.

Following a preliminary investigation opened on 25 January, the financial state prosecutor’s office announced on Friday night it had decided to push forward and recommend a judicial investigation on various issues, including the misappropriation of public funds.

A judge will be appointed to lead the inquiry and decide whether Fillon or his family members should be charged. There is no fixed timeframe and the judicial inquiry could take months.

Fillon had been one of the frontrunners in the French presidential election that will take place in two rounds in April and May. His campaign has faltered after the preliminary investigation was opened last month but he has vowed to continue and refused to stand down.

It is legal for French MPs to hire family members, as long as the person is genuinely employed. But investigators are to determine whether Fillon paid his wife and children vast salaries from taxpayers’ funds for fake parliamentary assistant jobs.

Fillon, who had campaigned as a sleaze-free “Mr Clean”, was alleged to have paid his British wife, Penelope, at least €680,000 (£577,000) of taxpayers’ money for a suspected fake parliamentary assistant job spanning 15 years. Financial prosecutors later extended their investigation to whether he also gave two of his children highly paid, allegedly fake jobs from state funds when they were still students.

Fillon has denied the allegations or any wrongdoing, saying the jobs were real.

The announcement came while Fillon was addressing a campaign rally in Maisons-Alfort, outside Paris.

“If I am attacked, so relentlessly attacked, it is because I clash with the spineless consensus that only likes the right when it walks in the shadows,” Fillon told the crowd.

Fillon’s legal team said in a statement that it was confident that the investigation would result in Fillon and his wife being found innocent.

By appointing a magistrate for a full inquiry, the prosecutor is putting more resources into the investigation. The magistrate has more powers to investigate, including tapping phones or placing suspects under house arrest. The magistrate can decide to drop the case, charge the suspect or send the case to trial.

Polls this week showed the far-right Front National candidate, Marine Le Pen, is likely to make it through to the final round of the election on 7 May to face either the independent centrist Emmanuel Macron or Fillon.