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Posted: Wednesday, 15 July 2009 12:49PM
Hernandez pleads not guilty in Ponzi scheme
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CHICAGO (AP) - A businessman and web radio promoter charged with swindling 290 victims out of $3.5 million in a Ponzi scheme pleaded not guilty Wednesday but added that he has hired an attorney who specializes in plea bargaining.
David Hernandez, 48, was arraigned before U.S. Magistrate Judge Susan E. Cox. He was held without bond pending a hearing Monday.
His attorney at the arraignment, John Meyer, said he was merely standing in for Jeffrey B. Steinback - a prominent plea agreement specialist.
But Meyer declined to comment after court when reporters asked whether Steinback's presence in the case meant Hernandez intends to change his plea.
Hernandez, 48, is charged with promising victims returns of 10 percent to 16 percent on investments that he never made. He paid some of the victims with money coming in from new investors, according to a federal indictment handed down last week.
He also lied in saying the so-called investments were insured, the indictment said.
In all, he allegedly collected $12 million and caused $3.5 million in losses.
Hernandez helped to launch ``Chicago Sports Webio,'' a now defunct web radio talk show, with well-known Chicago broadcaster Mike North.
Hernandez appeared before Cox in the bright orange jumpsuit of a prisoner.
Assistant U.S. Attorney Tinas Diamantatos objected to bail, saying Hernandez ``poses a serious risk of flight.''
Hernandez was arrested June 22 in Normal after a hotel where he was staying called the police. He was taken to a hospital with what police called ``unspecified injuries.'' In court, he wore a heavy bandage over one wrist and arm.
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Copyright 2009 by The Associated Press. All Rights Reserved.
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