Chen’s wife, Wu Shu-chen, is also on trial.
She and three presidential aides are accused of embezzlement, forgery and perjury. She is alleged to have siphoned $450,000 from a special presidential fund.
Prosecutors say Chen could be indicted once his term ends in May 2008, at which point his immunity will lapse.
Chen has said he is innocent and has promised to resign if Wu is found guilty.
Meanwhile on Wednesday, China rebuked Chen for his stance on wanting independence for Taiwan.
"Chen Shui-bian’s stubborn adherence to Taiwan independence for the last six years has consistently provoked confrontation between the mainland and Taiwan," said Li Weiyi, spokesman for the Taiwan Affairs Office of the State Council, China’s cabinet.
Chen, with backing from the majority of Taiwanese, rejects China’s claim of sovereignty over the self-ruled island and has sought to assert Taiwan’s separate status since being elected president six years ago.
Taiwan split with the mainland amid civil war in 1949. Beijing has repeatedly threatened to attack if Taipei attempts to formally declare independence.