Sarkozy arrived at the financial section of Paris's main court just after 8.00am on Wednesday morning to face magistrates who want to know why his right-wing UMP party paid fines imposed on him personally after he broke campaign spending limits.
They later announced that he had been named as an assisted witness, a status between an ordinary witness and a defendant that implies that charges could be brought later.
Sarkozy is now leader of the UMP and in 2012 stood as the party's candidate in an unsuccessful bid to be reelected.
His predecessor as party leader, Jean-François Copé, has already been charged over the scandal, as has former UMP treasurer Catherine Vautrin.
Sarkozy's campaign spent more than allowed by law, meaning that the UMP missed out on 10 million euros of state funding at a time when it was in big financial difficulties.
As candidate, Sarkozy was fined but the party paid the fine for him, basing itself on legal advice from lawyer Philippe Blanchetier, who has been named as a key witness in the case along with another former UMP official, Fabienne Liadzé.
Blanchetier and two other former party officials, Guillaume Lambert and Philippe Briand, were taken into custody in the related Bygmalion case, in which invoices were falsified to conceal a further 18.5 million euros of overspending.
Sarkozy denies any knowledge of the apparent fraud, which meant that his campaign spent nearly 50 per cent more than it was allowed to by law.