Spain duke Inaki Urdangarin suspended in fraud scandal Published duration 13 December 2011

image caption Inaki Urdangarin has denied siphoning public funds into other companies

The son-in-law of Spain's King Juan Carlos I has agreed to step down from official duties amid a rare corruption scandal for the royal family.

Inaki Urdangarin, who married Princess Cristina in 1999, is being investigated over claims he misused public funds given to a foundation he ran.

He has denied wrongdoing over the events in 2004 to 2006 but has said he regrets the "damage" caused.

The royal family has said it will now make its accounts publicly available.

Rafael Spottorno, head of the king's household, said the 43-year-old Duke of Palma de Mallorca - a former Olympic handball player - had agreed with the palace that he would not take part in official duties for the foreseeable future.

The duke's behaviour "does not seem exemplary", Spanish media quoted Mr Spottorno as saying, but he said he had the right to be presumed innocent.

It was unclear whether his wife, the king's youngest daughter Princess Cristina, was also affected.

The exact details of the accusations against the duke have not been made public.

But Spanish media say the duke is accused of misdirecting part of some 6m euros (£3.9m: $8m) to his not-for-profit Noos Insitute by regional governments to organise sporting events.

Some of the money allegedly ended up in for-profit companies which he ran. He stepped down as head of the institute in 2006.

The duke's lawyer, Mario Pascual Vives, said his client was "worried, saddened and rather indignant at what is coming out in the media".

"He will always clearly feel... he is fully innocent."

The Spanish royal family is largely well-regarded in the country, with King Juan Carlos credited with steering the country through the transition from dictatorship to democracy.

It has responded to the scandal by announcing it will make available a full breakdown of its annual spending budget.

Prime Minister Jose Luis Rodrigues Zapatero told Spanish media the public must "value the institutional role which the monarchy has", and that he hoped everyone would "respect the judicial process".