FRENCH NEWSPAPER LE MONDE has lodged a legal complaint against President Nicholas Sarkozy for allegedly breaching source confidentiality.

The paper claims the president broke the law by ordered spying on reporters covering the L’Oreal heiress scandal.

Police are investigating allegations that billionaire heiress Liliane Bettencourt was involved in tax evasion and political corruption.

Le Monde claims that the French secret service studied the phone records of a justice ministry employee to see if he leaked information to the paper’s reporters.

Today, it reports that Sarkozy’s office has denied the claims, and says that no instructions were given to any service to investigate the sources of published leaked information.

One of Sarkozy’s cabinet, Labour Minister Eric Woerth has been questioned by police for allegedly accepted illegal donations from Bettencourt for Sarkozy’s party.

Woerth denies the allegations. Investigators recently searched the party’s HQ in Paris for correspondence between Bettencourt’s estate and Woerth.

Sarkozy’s party, UMP, told Le Monde it would not comment on an ongoing investigation.