Iñaki Urdangarin and his wife Cristina, sister of King Felipe VI, went on trial in January along with 15 others at a court in Palma on the palm-lined Mediterranean island of Majorca in a case that has sullied the monarchy's reputation.
The case centres on accusations that Urdangarin, former Olympic handball medallist, used his royal connections to win inflated public contracts to stage sporting and other events and then syphoned off the proceeds to fund a lavish lifestyle.
He and his former business partner Diego Torres are accused of embezzling about six million euros ($6.6 million) in public money that was paid to the Noos Institute to organise events.
One of the companies that allegedly benefited from Noos was Aizoon, a real estate firm that Urdangarin owned with Cristina, the youngest daughter of former King Juan Carlos I who abdicated in June 2014.
Aizoon has been labelled a "front company" in court documents.
Both Urdangarin and Torres have told the court that they informed Carlos Garcia Revenga, the former private secretary to Cristina and her sister Elena, of their business dealings.
Asked in court on Thursday if he informed Juan Carlos, as well as Revenga, of his deals, Urdangarin said: "Yes, I informed him of my project."
Urdangarin was referring to an e-mail he sent to Juan Carlos in which explained that the Noos Institute had organised a three-day sports conference in 2004, 2005 and 2006 in exchange for a payment of three million euros from the regional government of Valencia.
He stressed that Juan Carlos did not "at any moment" intervene in his business dealings.
Cristina, who has denied knowledge of her husband's activities, is the first Spanish royal to face criminal charges since the monarchy's 1975 restoration. She is scheduled to be questioned in court after Urdangarin, possibly on Friday.
She has been charged with tax evasion. If convicted she faces a jail term of up to eight years.
Urdangarin, who has been charged with the more serious crimes of embezzlement, influence peddling, forgery and money laundering, faces more than 19 years in prison.