PARIS (Reuters) - Nicolas Sarkozy, seeking to return to power as French president, denied on Tuesday receiving money from deposed Libyan leader Muammar Gaddafi to fund his election bid in 2007, calling claims by a Franco-Lebanese businessman a "crude manipulation".

In a filmed interview released on Tuesday by the news website Mediapart, Ziad Takieddine said he had transferred about 5 million euros ($5.4 million) of illicit funding from Gaddafi's former intelligence chief Abdullah Senussi to Sarkozy and his campaign director Claude Gueant.

Sarkozy, who served as president from 2007 to 2012 and is seeking nomination as the conservative candidate in next year's presidential election, has always denied allegations that he took covert funding from Libya.

"Once more, and always before an election, Mediapart is trying to taint Nicolas Sarkozy with allegations (that are) as untrue today as they were yesterday," Sarkozy's lawyer Thierry Herzog said in a statement sent to Reuters.

Legal proceedings will be launched in response to "this crude manipulation", he added.

Takieddine's statement came just days before the first round of a primary election to pick the center-right's candidate and risked overshadowing the last days of Sarkozy's campaign.

"Why and how can a guy like this stand for presidency of the Republic? The French people must react. It will explode," Takieddine said.

Gueant's lawyer, Philippe Bouchez El Ghozi, also denied the allegations by Takieddine.

"Claude Gueant has always been very clear. He never received from near or far or heard about a centime of money from Libya to support Nicolas Sarkozy's campaign. He has repeated this multiple times to the judicial authorities," he told Reuters.

Ghozi said Gueant would also sue.

INVESTIGATION

France's public prosecutor opened a judicial investigation into earlier allegations by Takieddine in 2013, but until now, he had never described how the money was transferred or directly pinpointed Sarkozy.

Takieddine said he had given a written deposition to judges on Nov. 12 detailing three separate cash transfers between 2006-2007 and his meetings with Gueant and Sarkozy.

At no point, he says, did he see the two men ever look inside the cases after he dropped them off at the Interior Ministry, where Sarkozy was minister at the time.

In his statement, Herzog also sent a copy of a witness statement made to police by Takieddine in 2012 in which the businessman said he had last seen Sarkozy in November 2003.

"Anyone can deduce a precise idea of the credibility of the account given by Ziad Takieddine," he said.

Libyan officials from the Gaddafi era have previously claimed they helped to finance Sarkozy's election campaign.

Gaddafi was toppled and killed during an uprising against his rule in 2011.

Sarkozy also has other legal headaches. In September, France's state prosecutor said he should stand trial over funding irregularities linked to his failed 2012 re-election bid. A magistrate is due to rule later this month on whether he will stand trial or not.

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(Reporting by Gerard Bon, Emmanuel Jarry and John Irish; Editing by Andrew Callus and Gareth Jones)