PARIS (Reuters) - A French junior minister stepped down on Friday after he was accused in a preliminary investigation of favoring relatives in the award of public contracts.
Kader Arif handed his resignation from the veterans affairs portfolio to Socialist President Francois Hollande to be able to fully cooperate with the investigation conducted by a state prosecutor, the president's office said in a statement.
Arif is a close friend of Hollande and his resignation spells more bad news for France's most unpopular president in polling history, who has seen several ministers embroiled in tax and fraud scandals over the past months.
"My name has been cited in a preliminary investigation," he said in a statement. "Out of respect for ministerial function ... I am choosing with full responsibility to leave the post that I have occupied for two years."
In September, Arif told French media that he was "absolutely not concerned" by earlier allegations in the same case.
The preliminary investigation focuses on 2 million euros ($2.5 million) of public contracts awarded by the southern Midi-Pyrenees region to two companies that belonged partly to Arif's brother and nephews. A preliminary investigation is a first step before a possible full inquiry.
Arif was vice president of the urban community of Toulouse from 2008 to 2012 and an influential figure of the Socialist Party in the region.
In September, junior trade minister Thomas Thevenoud was forced to resign just nine days after his appointment in a cabinet reshuffle, after it emerged he had not paid income taxes for three years.
Earlier this year, Hollande's chief communications adviser, speechwriter and a main political strategist, Aquilino Morelle, quit over accusations of past conflict of interest linked to his work for pharmaceutical firms.
The scandals further undermined Hollande's 2012 campaign pledge to run an "exemplary Republic", already damaged when his former budget minister, Jerome Cahuzac, resigned over revelations that he had secret bank accounts in Switzerland.
Jean-Marc Todeschini, senator for the eastern province of Moselle, will succeed Arif in the government.
(Reporting by Gerard Bon; Writing by Natalie Huet and Nicholas Vinocur; Editing by Alison Williams)