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A former LDS bishop in Connecticut pleaded not guilty Thursday to a federal indictment that says he defrauded investors, including church members, out of more than $400,000.

Julius Blackwelder, now a resident of West Jordan, is accused of using the money to pay back earlier investors in a Ponzi scheme, build a waterfront home in Stratford for himself and repay personal bank loans.

The indictment returned Monday by a grand jury in Bridgeport, Conn., charges Blackwelder with nine counts of money laundering and mail and wire fraud. If convicted, he faces a maximum term of imprisonment of 20 years on each count of mail and wire fraud and 10 years on each count of money laundering.

Beginning in 2005, Blackwelder, 59, allegedly persuaded church members of his local ward of The Church of Jesus Christ of Latter-day Saints in Trumbull and others to invest their money in a pool known as the "Friend's Investment Group" by exaggerating his experience as an investor. He misled investors by saying he would invest their money in safe, long-term commodities futures contracts and, in some cases, guaranteeing a specific return on investment, according to prosecutors.