Chicago: A Chicago based IndianAmerican businessmen with ties to jailed Illinois governor Rod Blagojevich has been arrested and charged with bribing doctors for patient referrals and filing false federal income tax returns.

Raghuveer Nayak, 57, owner of multiple outpatient surgery centres in Illinois and Indiana, was charged in a 19-count federal grand jury indictment unsealed Wednesday following his arrest, the US attorney’s office announced.

At a brief hearing at the Dirksen district court Wednesday, Nayak pleaded not guilty and US magistrate judge Maria Valdez ordered him released on a bond of $10 million secured by six properties, according to the Chicago Sun Times.

Nayak was a long time fundraiser for Blagojevich, convicted in the scandal to sell President Barack Obama’s former Senate seat, and Jesse Jackson, a member of the US House of Representatives.

According to the indictment, “between 2000 and December 2010, Nayak allegedly defrauded patients by paying and arranging to pay bribes and kickbacks in the form of cash and other hidden payments to physicians who would refer their patients to Nayak’s facilities for medical treatment.”

“After he was interviewed by law enforcement agents in December 2008, Nayak allegedly took additional steps to hide the scheme by executing fraudulent contracts and by warning physicians not to speak with agents about the payments,” it said.

Each count of mail fraud carries a maximum penalty of 20 years in prison and a maximum fine of $250,000.