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Steve Bannon, a former adviser to President Trump and an architect of his 2016 campaign, on Thursday pleaded not guilty in federal court in Manhattan after being indicted with three others in connection with an online fundraising campaign that prosecutors claim defrauded donors of hundreds of thousands of dollars.

Bannon will now be released on a $5 million bond.

Bannon and three other suspects had been indicted Thursday morning in connection to their online fundraising campaign and charged with defrauding the money from an online campaign.

STEVE BANNON, 'WE BUILD THE WALL' ORGANIZERS ARRESTED, CHARGED WITH DEFRAUDING DONORS

Bannon was arrested by federal postal inspectors and special agents from the United States attorney’s office around 7:15 a.m. on a yacht off the coast of Connecticut.

Meanwhile, Shea appeared virtually at a court hearing in Colorado, where a judge agreed to a $250,000 bond. Shea is restricted from traveling outside the District of Colorado, except to travel to the Southern District of New York. He is prohibited from contacting co-defendants or possessing firearms.

According to the indictment, Bannon and co-defendant Brian Kolfage raised money for a "volunteer organization" and told the public that 100 percent of donations would go toward the federal government's building of a wall along the U.S.-Mexico border.

The campaign's website said that all of the money raised would go to the government for building the wall, and that if they did not meet their fundraising target, they would "refund every single penny," according to the indictment.

"These representations were false," the indictment read.

Within a week of Kolfage launching the campaign in December 2018, they raised roughly $17 million, prosecutors said.

Prosecutors claim that Kolfage, Bannon, Andrew Badolato and Timothy Shea took money for themselves as the campaign raised upward of $25 million. The indictment alleges that Bannon received more than $1 million through a nonprofit that he then used for personal expenses and to pay Kolfage.

Prosecutors say Bannon and the others used the nonprofit and a shell company to hide the payments to Kolfage “by using fake invoices and sham ‘vendor’ arrangements,” as well as other means of keeping the payments quiet. The indictment stated that in order to raise funds, Kolfage and Bannon “repeatedly and falsely” told the public that Kolfage would “not take a penny” in compensation.

Due to concerns by the crowdfunding platform used to collect the money, GoFundMe, about where the money was going, it told Kolfage to identify a legitimate nonprofit where the money would go or the funds would be returned to donors.

At that point, prosecutors said, Bannon and Badolato worked on creating the nonprofit We Build the Wall Inc.

The stated goal was changed to using the money to privately construct the wall without government, and past donors had to agree to the stated purpose. They told donors no money would go to Kolfage or the board, the 24-page indictment said.

TRUMP REACTS TO 'VERY SAD' BANNON ARREST 

When Kolfage, Bannon, and Badolato learned in the fall of 2019 that the endeavor was under federal investigation, they allegedly "took additional steps to conceal the fraudulent scheme," the indictment said. This allegedly included using encrypted messaging applications, putting a stop to Kolfage's salary payments, and removing text from the website saying that Kolfage would not be compensated while adding a notification that he would begin collecting a salary in January 2020.

"As alleged, the defendants defrauded hundreds of thousands of donors, capitalizing on their interest in funding a border wall to raise millions of dollars, under the false pretense that all of that money would be spent on construction," Acting U.S. Attorney Audrey Strauss said in a statement. "While repeatedly assuring donors that Brian Kolfage, the founder and public face of We Build the Wall, would not be paid a cent, the defendants secretly schemed to pass hundreds of thousands of dollars to Kolfage, which he used to fund his lavish lifestyle."

Bannon and the other defendants were each charged with conspiracy to commit wire fraud and conspiracy to commit money laundering. Each count carries a maximum penalty of 20 years in prison.

Trump, hearing of the charges, tried to distance himself from Bannon. Trump said he feels  “very badly” his former adviser was arrested for defrauding donors and called the project “inappropriate.” He said he hadn't dealt with Bannon in "a very long time."

"I feel very badly. I haven't been dealing with him for a very long period of time," Trump told reporters. "I haven't been dealing with him at all."

The president said he didn’t “know anything about the project at all” but also said he “didn’t like” it.

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“I thought it was being done for showboating reasons,” Trump said.

Fox News' Marta Dhanis and Ronn Blitzer contributed to this report.