Uzair Paracha, 23, detained as a material witness since his March arrest in New York, waved and smiled to more than a dozen family members as he entered U.S. District Court in Manhattan for a brief appearance. He was held pending a bail hearing next week.
According to the criminal complaint, Paracha agreed to help the al Qaeda associate obtain documents that would let him enter the United States and help him obtain legal immigration status. The government has not released the associate's identity but say the man has remained overseas.
Anthony Ricco, Paracha's lawyer, said outside court that his client was manipulated into helping the associate and was looking forward to a trial to prove that he had no criminal intent.
He described Paracha as "a very bright, but, I say, a very naive young man" and added that he did not expect to contest that his client knew the associate was in al Qaeda.
"Having knowledge someone is in al Qaeda is not a criminal act," Ricco said. "Many members of al Qaeda are not involved in criminal activity."
Ricco told CBSNews.com earlier this week that information from Khalid Sheikh Mohammed, the alleged Sept. 11 mastermind arrested in March, was behind the indictment.
Prosecutors said Paracha met with a man believed to be an al Qaeda associate in Karachi, Pakistan, before Paracha traveled to the United States in mid-February.
Paracha was told that the man wanted to invest about $200,000 in the business for which Paracha worked in Karachi — and that he was not to ask any questions because the associate and a second man were supporters of Osama bin Laden, the complaint alleged.
The complaint, prepared by an FBI agent, said Paracha believed the funds belonged to al Qaeda and that he needed to perform certain tasks for the money to be invested. It also said he believed the associate was trying to recruit him to join al Qaeda.
The man asked Paracha, a permanent U.S. resident, to contact U.S. immigration authorities and pose as the associate to get a travel document that would allow the associate to enter and remain in the United States, according to the complaint.
"This case demonstrates that al Qaeda will go to great lengths to enlist support here in the United States," Attorney General John Ashcroft said in a statement.
The government alleged that, while in the United States, Paracha placed telephone calls on behalf of the al Qaeda associate to immigration authorities and to a bank where the associate held an account.
Prosecutors said Paracha told the FBI in March that he possessed several items of identification belonging to the al Qaeda associate.
A search of his belongings in the Brooklyn apartment where he was staying revealed that he had a Maryland driver's license and a bank ATM card in the associate's name, prosecutors said.
Paracha was charged with conspiring to provide material support and resources to the terrorist organization. If convicted, he could face up to 15 years in prison and a $250,000 fine.
On Thursday, Farhat Paracha told The Associated Press in a telephone interview from her home in the southern Pakistani port city of Karachi that the United States is holding her son illegally.