The leader of France's embattled centre-right opposition quit Tuesday following claims that invoices for former president Nicolas Sarkozy's 2012 election campaign were fraudulently billed as party expenses.

Jean-Francois Cope agreed to step down at the request of fellow heavyweights in the Union for a Popular Movement (UMP) following the latest twist in an scandal engulfing him and a PR firm owned by two close friends.

The 50-year-old leader's position became untenable after Sarkozy's former deputy campaign director gave an explosive television interview on Monday evening.

Jerome Lavrilleux tearfully claimed that bills for Sarkozy's failed 2012 re-election campaign were passed off as invoices for party meetings in order to skirt round France's strict limits on campaign financing.

Lavrilleux claimed that neither Sarkozy nor Cope were aware of what was being done. "I didn't have the courage to say 'stop, we have gone too far'," he said.

As party leader Cope was responsible for authorising the payments made to Bygmalion.

According to a lawyer for the company, the amount billed to the UMP that should have been charged to Sarkozy's campaign amounted to more than 10 million euros ($13.6 million).

The lawyer says the company was pressured to falsify the bills or risk not getting paid.

While Bygmalion has sought to explain the false bills as an attempt to help Sarkozy, some senior UMP figures suspect the company of simply seeking cash, with the connivance of Cope.

The saga is the latest in a series of scandals linking Sarkozy to alleged irregularities in the funding of his electoral campaigns which threaten to wreck his chances of reclaiming the presidency in 2017.

- 'Party's credibility damaged' -

The most serious of them involves allegations that he received undeclared cash from former Libyan dictator Moamer Kadhafi.

Sarkozy was cleared last year of personally accepting envelopes stuffed with cash from France's richest woman, L'Oreal heiress Liliane Bettencourt, but his campaign treasurer is awaiting trial in that case.

The drip of corruption allegations against the UMP has been credited with helping to fuel a surge in support for the far right National Front (FN), which topped the polls in Sunday's European elections with an unprecedented 25 percent share of the vote.

FN leader Marine Le Pen immediately went for the jugular saying the scandal "created a very serious situation for democracy in France" and adding: "I cannot see how Nicolas Sarkozy can escape his moral responsibility."

Cope, who had previously shunned calls for his ouster, agreed to relinquish the leadership from June 15 at what participants described as an "extremely angry" meeting.

"He did not raise any objection to stepping down," said Jean-Pierre Raffarin, who will share the interim leadership with two other former premiers, Francois Fillon and Alain Juppe.

Sarkozy, who denies any wrongdoing in any of the cases he is involved in, was rapped by France's constitutional court last year for exceeding campaign spending limits. The court ordered the party to repay some 10 million euros.

It did so quickly thanks to an energetic collection drive led by Sarkozy that many pundits saw as a reminder of his charisma and strong appeal to voters on the right of France's political spectrum.

As UMP leader, Cope has never fully emerged from Sarkozy's shadow and the party was badly damaged by the protracted and bitter leadership battle he fought with Fillon in 2012.

Fillon said Tuesday the UMP's "credibility and honour have been damaged" after the European elections debacle, in which the party came second with 20.8 percent of the vote.

Fillon has made no secret of his desire to be a presidential candidate in 2017 even if Sarkozy makes a comeback. Polls suggest Juppe would be the most popular candidate with voters.