Houston: Former Enron chairman Ken Lay has pleaded not guilty to the charges that he committed fraud and lied to his employees and others.

US Magistrate Judge Mary Milloy set his bond at half million Dollars unsecured rather than the six million as requested by the prosecutors, and Lay was allowed to walk away a free man, at least for now.

Theoretically, Lay, indicted by a grand jury investigating financial irregularities at the former energy giant, could face up to 175 years in prison and $ 5.75 million fine, but in reality, total prison time under the federal sentencing guidelines would be far less.

"Not guilty, your honor," Lay, speaking loudly and clearly, told Milloy at a court hearing hours after he surrendered to the FBI (Federal Bureau of Investigation).

At a press conference later, Lay asserted his innocence and denied that any chief executive can know everything his subordinates are doing.

"It has been a tragic day for me and my family," Lay said. "I continue to grieve over the loss of the company and my failure at not being able to save it," he said.

"But failure does not equate to a crime."

He said that while "there may be some Superman somewhere," who knows every single thing that happens at his company, that's an unrealistic expectation.

"I firmly reject any notion that I engaged in any wrongful or criminal activity," Lay said.

"Not only are we ready to go to trial, but we are anxious to prove my innocence," he added.