Hassan Nemazee, a New York financier and Democratic party fund-raiser, pleaded not guilty on Wednesday to bank fraud charges after being indicted by a grand jury earlier this week.

Mr. Nemazee, who is accused of fraudulently obtaining $292 million in loans from three banks, was allowed to remain confined to his home pending trial after a federal court hearing in Manhattan.

Prosecutors from the U.S. Attorney's office in Manhattan allege he used the money in part to fund a lavish lifestyle and contribute to Democratic campaigns and political action committees.

After the hearing, Mr. Nemazee's lawyer, Paul Shechtman, said his client's campaign contributions were "modest and lawful." Mr. Shechtman added: "This is not a case about funneling money to candidates."