Russell Wasendorf Sr., chief executive officer of failed futures brokerage Peregrine Financial Group, pleaded not guilty to lying to federal regulators on Friday.
The widely expected move is likely to set the stage for an eventual plea agreement, legal observers said, after Mr. Wasendorf confessed last month to bilking his customers out of millions of dollars.
Mr. Wasendorf, 64, was indicted on Monday on 31 counts of overstating the amount of customer funds at his brokerage by tens of millions of dollars in faked monthly and yearly reports to the U.S. Commodity Futures Trading Commission (CFTC).
In his first appearance since the indictment, he shuffled into the small courtroom at U.S. District Court Northern District of Iowa in Cedar Rapids, clad in an orange prison jumpsuit, with his hands and feet shackled.
"At this time he pleads not guilty on each count," his public defender, Jane Kelly, told Magistrate Judge Jon Scoles.
Futures brokerages are required to submit financial data on a monthly basis to the CFTC, and the reports are then published on the regulator's website.
The CFTC has said Mr. Wasendorf misappropriated more than $200-million (U.S.) in customer funds.
If convicted on all charges, Mr. Wasendorf faces up to 155 years in jail, a $7.75-million fine and 93 years of supervised release following any imprisonment, according to the U.S. Attorney's Office.
He has been held in an Iowa county jail since being arrested July 13 at a hospital, where he was being treated after attempting to kill himself.
Peregrine filed for bankruptcy protection on July 10, one day after Mr. Wasendorf attempted suicide and left a note describing how he had stolen from customers for nearly 20 years.
The collapse of what was once a mid-sized futures brokerage has dealt a further blow to confidence in the futures industry, coming less than a year after MF Global Holdings Ltd.'s bankruptcy, which left customers with a $1.6-billion shortfall.
Using little more than a post office box, laser printers and Photoshop software, Mr. Wasendorf said in his confession that he forged and intercepted financial statements that were mailed between U.S. Bank, where some Peregrine customer money was held, and the firm's auditors at the National Futures Association.
He also said he spent most of the stolen money trying to keep his brokerage afloat.