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Lille (France) (AFP)

French President Emmanuel Macron said Thursday he was sticking by his close ally Richard Ferrand after the assembly president was charged with conflict of interest over a property deal.

The allegations against Ferrand first emerged in 2017, causing embarrassment for Macron who had just won power on a pledge to rejuvenate France's corruption-plagued political class.

Ferrand, who had been appointed a minister in Macron's first cabinet, stepped down but later made a comeback after prosecutors dropped the case, saying there was no basis for a prosecution.

The matter did not end there however.

In 2018, an anti-corruption organisation filed another complaint against Ferrand, forcing the case, which relates to a property deal involving a health fund Ferrand once headed, to be re-opened.

In the early hours of Thursday the magistrates leading the probe announced they had decided that the case should proceed and charged Ferrand with conflict of interest.

Reacting to the announcement, Macron said Thursday that Ferrand still had "all my confidence", government spokeswoman Sibeth Ndiaye said.

Speaking to Europe 1 radio Ndiaye called Ferrand a "loyal, upstanding man with an exemplary political career" and said that there was no reason for him to step down.

But the opposition was quick to react to the charges with calls for Ferrand to resign.

"Being charged does not signal guilt but a serene public debate supposes that those who exercise national public roles resign pending the decision of the justice system," Socialist leader Olivier Faure tweeted, a call echoed by Nicolas Dupont-Aignan, the leader of a small anti-EU party.

- Blow for Macron -

The allegations against Ferrand, one of Macron's first backers when he ran for president, were first revealed by the Canard Enchaine investigative weekly in 2017.

The paper claimed that in 2011 a public insurance fund that Ferrand headed in his native Brittany agreed to rent a building from Ferrand's wife and carry out renovations that boosted its value.

Ferrand, 57, denied any wrongdoing saying his wife made the fund the best offer and that he had no say in the matter.

In a statement sent to AFP Thursday Ferrand said was "determined to continue (his) role" as the president of the lower house of parliament, which he has held since September 2018.

He said he was "serene about the outcome of the investigation", arguing that no new evidence had been brought forward since 2017 in the case "in which there is neither harm caused nor victim."

The charges against France's fourth-most important public figure, nonetheless deal a blow to Macron, who campaigned on a promise to make politics more ethical.

They come as another key ally of the 41-year-old leader is under scrutiny in a series of investigations over suspected fake jobs in the European Parliament.

Francois Bayrou, head of the centrist MoDem party which is allied to Macron's Republic on the Move party was questioned Wednesday by anti-corruption police over claims that MoDem used EU money for parliamentary assistants to create fake jobs for party members.

Marielle de Sarnez, a MP who briefly served as European Affairs minister in 2017, was also questioned.

A day earlier France's pick for the European Commission, Sylvie Goulard, was also questioned by police this week over the claims involving her former party.

MoDem is however not the only party accused of fraudulently using EU money to fund party work in France.

The far-right National Rally (ex-National Front) also being investigated over similar allegations.

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© 2019 AFP