Petters-Linked Hedge Funder Says Not Guilty Of New Charges

Sep 25 2012 | 1:53am ET

For the second time, a hedge fund manager charged with aiding the Thomas Petters Ponzi scheme has pleaded not guilty.

Arrowhead Capital Management founder James Fry entered his plea to new charged brought in July. Fry and Frank Vennes, Petters' chief fundraiser who also pleaded not guilty to the new charges earlier this month, face 31 counts of wire fraud, bank fraud, securities fraud, money laundering and making false statements.

Fry was first charged last July. According to prosecutors, he lied to investors about Petters' default on notes owned by Arrowhead and failed to tell clients about Vennes' criminal past. Arrowhead's chief financial officer pleaded guilty to playing a role in Petters' $3.65 billion fraud in April of last year.

Fry and Vennes are set to go on trial in February.

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