French opposition chief quits amid party funding probe

By Sophie Louet PARIS (Reuters) - The chairman of France's conservative opposition party UMP, Jean-Francois Cope, bowed to pressure on Tuesday to step down amid an investigation into party funding, throwing open the race for the UMP nomination for president in 2017. UMP finances have been the subject of a legal inquiry after the lawyer of an events company hired for former president Nicolas Sarkozy's 2012 re-election bid alleged that the firm had been ordered by party officials to produce millions of euros' worth of fake invoices to cover campaign cost over-runs. The affair could complicate the come-back hopes of Sarkozy, whose rivals could include his former prime minister Francois Fillon, Alain Juppe - who held the same post in the 1990s - and candidates from the party's younger generation. Marine Le Pen's National Front, already riding high after winning Sunday's European Parliament elections in France, leapt on the resignation to back its argument that the political establishment was self-serving and distant from voters. Cope, who was party general secretary at the time, has repeatedly stated he had no knowledge of any wrongdoing but has faced mounting pressure from his own party allies to quit. "I am asking the French not to doubt my integrity," Cope told TF1 evening news. "I trusted people whose job it was to keep watch over such things ... They took advantage of my trust." UMP officials emerging from closed-door crisis talks said the party had agreed to put in place a temporary leadership team of Fillon, Juppe and Jean-Pierre Raffarin, another ex-premier, to run the UMP until a leadership contest set for October. "We always listen to you with much attention, Jean-Francois. But how can we have trust?" Fillon, who clashed with Cope over its leadership in 2012, said at the meeting, according to a written statement of his comments sent by his office. "The honor of our political family is at stake," he said, urging Cope to "step aside". A UMP source said Cope's resignation - along with that of the current party leadership - would take effect from June 15. "This shows that Nicolas Sarkozy betrayed democracy and betrayed the rules of our Republic," Le Pen told a news conference, referring to strict limits on the amount that parties can spend on election campaigns. Sarkozy himself was not named in the legal complaint and has made no statement following Cope's resignation. POLICE SEARCH PREMISES Cope's position was already weakened by the poor result of the UMP in Sunday's European Parliament election, where it was beaten into second place by the far-right National Front. Events accelerated on Monday as Jerome Lavrilleux, deputy director of Sarkozy's presidential campaign, acknowledged in a TV interview accounting "slip-ups" in Sarkozy's failed 2012 election campaign but added that neither Cope or Sarkozy had been made aware of any anomalies. While Cope acknowledged he was responsible for general oversight of the party's budget, he said had been deceived by colleagues who failed to flag any irregularity in the accounts. "It was not taking place in front of my eyes, it was not taking place in my office, and that's exactly the problem," he said, adding that he had "never" lied about his role. Hours earlier, police had searched UMP premises after accusations by a lawyer for Paris-based event organizer Bygmalion that the UMP ordered fake invoices totaling some 11 million euros ($15 million) to cover up campaign cost over-runs. Sarkozy, who was beaten by Socialist Francois Hollande in 2012 after one term in office, has made little secret of his desire to re-enter politics. He is still a hero for much of the French right but his brash style and trenchant positions on immigration and other issues make him a divisive figure. He could also face difficulties in a separate fraud investigation targeting French businessman Bernard Tapie, who is alleged to have benefited from an improper arbitration payment of over 400 million euros awarded in 2008 under Sarkozy's presidency. Both Tapie and Sarkozy have denied wrongdoing. The UMP was formed in 2002 from the ashes of the old RPR Gaullist party in an attempt to unite a disparate French right that extends from centrist moderates to hardline right wingers - some of whom have since split off and joined the FN. "We need to recreate that unity," said deputy Nathalie Kosciusko-Morizet, the party's unsuccessful candidate for the Paris city hall in March. "The French are counting on us for a change in government." ($1 = 0.7325 Euros) (Additional reporting by Nicholas Vinocur; Writing by Mark John; Editing by Alison Williams)