Francois Fillon, favourite to defeat Marine Le Pen, found to have paid two children as aides

The French presidential frontrunner Francois Fillon, who was favoured to defeat right-wing FN candidate Marine le Pen, has been further engulfed in a mounting expenses scandal as it emerged the former minister paid wages to his two children as legislative aides.

The French satirical newspaper Le Canard Enchaine is to report the details, after it broke the story last week that Fillon had paid his wife Penelope Fillon hundreds of thousands in wages – despite claims none of his staff had never seen her work for him.

Le Canard reveals in its most recent edition that Penelope, who was born in Britain, was paid €330,000 more than previously understood, bringing her total earnings as a legislative aide to €830,000. The pair's two children reportedly earned €84,000 between them from 2005-2007.

Anti-corruption police have raided offices in the French parliament over the allegations. As they emerged, Fillon has said he looked forward to meeting with investigators to set out the truth. He reiterated he believed the claims to be baseless.

In a unique move, the establishment candidate has said he will withdraw from the race if the preliminary inquiry becomes a formal one. No French presidential candidate has ever dropped out of the race at this late a stage.

The scandal has already harmed Fillon in the polls. He had previously presented himself as the anti-sleaze candidate in the upcoming May election. He also presented himself as fiscally conservative and has promised to cut 500,000 civil servant jobs.

Fillon's popularity had begun declining even before the accusations against him were made public. At the end of November, the polls saw him as leading the first round of votes in the April presidential election. But in several polls published between 10 and 12 January, FN leader Marine Le Pen took the lead in the first round of votes, although she would still lose if pitted against Fillon in the second election round in May.

The fake job scandal has worsened the trend for Fillon, whose chances of advancing to the second round of the election are now threatened by the popularity of independent candidate Emmanuel Macron. A Kantar-Sofres poll published in Le Figaro on 29 January showed that, while Le Pen would be winning the most amount of votes in April's first round, she would lose to either Fillon or Macron in a May runoff. Macron, however, would beat Fillon if the two were pitted against one another.

"A runoff without Francois Fillon is no longer ruled out," Emmanuel Riviere of the Sofres pollster told Reuters. "What boosts Emmanuel Macron's momentum is, above all, Penelopegate."

The Fillon scandal could open the door wider for Le Pen who, despite robust support, remains unlikely to win in a French presidential run-off. Under the system the two candidates with the largest share of the votes face each other in a second round against each other guaranteeing the president a majority and a mandate to govern. It is believed Le Pen, whose populist policies are deeply divisive, would unite all opposition against her in such a scenario.