This court sketch shows terrorism suspect Tahawwur Hussain Rana appearing at a bond hearing before federal Magistrate Judge Nan Nolan on Wednesday in Chicago. (Lou Chuckman/Associated Press)

A Canadian citizen accused of aiding a plot to attack a Danish newspaper that published controversial cartoons about the Prophet Muhammad will remain in custody as the court considers his bail request.

U.S. Magistrate Judge Nan Nolan said she needed more time to consider the case of 48-year-old Tahawwur Hussain Rana, a Canadian who primarily resides in Chicago, and scheduled a new hearing for next Tuesday.

Defence attorney Patrick Blegen said Rana lacks the money to live a life on the run, but prosecutors argued his Canadian citizenship and offices in Canada made him a flight risk.

A grocery store, one of several businesses owned by Rana, on Chicago's Devon Avenue. (Paul Beaty/Associated Press)

Rana appeared in court Wednesday dressed in an orange jumpsuit and glasses and sporting a thick beard. Blegen said his client denies the charges against him.

"He adamantly denies the charges and eagerly awaits his opportunity to contest them in court and to clear his and his family's name," Blegen said.

Rana was arrested on Oct. 18 in Chicago and held in custody on charges he helped to arrange two trips to Denmark for another man — David Coleman Headley — who allegedly was conducting surveillance on possible targets.

Rana and Headley, both originally from Pakistan, were charged with one count each of conspiracy to provide material support to an overseas terrorism conspiracy, in criminal complaints unsealed on Tuesday.

Headley, 49, an American who changed his name from Daood Gilani in 2006, was also charged with one count of conspiracy to commit terrorist acts involving murder and maiming outside the United States.

If convicted, Rana faces a maximum of 15 years in prison while Headley faces a maximum of life imprisonment. A second charge was also added to Rana's case, although the nature of the new charge is not yet known.

Newspaper workers targeted

The Department of Foreign Affairs said it was aware of Rana's arrest and said the Canadian Consulate in Chicago is working closely with local authorities, and is requesting consular access, according to spokesman Alain Cacchione.

A man shouts during a May 2008 protest in Karachi, Pakistan, against a Dutch film and the reprinting of cartoons of the Prophet Muhammad in Danish newspapers. (Zahid Hussein/Reuters)

However, due to the Privacy Act, no further information will be provided at this time, he added.

The alleged plot involved an attack on the offices of the Jyllands-Posten newspaper, which published 12 cartoons depicting the Prophet Muhammad in 2005, including one showing Muhammad wearing a bomb-shaped turban.

Muslims around the world took great offence, as Islamic law generally opposes any depiction of the Prophet, even favourable, for fear it could lead to idolatry.

Prosecutors said Headley told FBI agents after his Oct. 3 arrest at Chicago's O'Hare International Airport that the initial plan called for attacks on the newspaper's offices, but that he later proposed just killing the paper's former cultural editor and the cartoonist behind the drawings.

Plot called 'Mickey Mouse project'

The FBI said in court papers that Headley described his plan for the attacks as "the Mickey Mouse project."

Rana's Chicago home is seen in this photo taken Tuesday. (Paul Beaty/Associated Press)

Patrick J. Fitzgerald , the U.S. Attorney for the Northern District of Illinois, said the complaints allege Headley identified and conducted surveillance of potential targets of a terrorist attack in Denmark on two separate trips to the Scandinavian country in January and July 2009.

Rana is accused of helping to arrange Headley's travels overseas and concealing their true nature, and also discussed potential targets for attack with Headley, officials said.

Rana owns several businesses, including First World Immigration Services, which has offices in Toronto, Chicago and New York. Justice officials allege Headley claimed to be an employee or representative of Rana's business, but appeared to perform "little if any actual work for the business."

Despite his apparent lack of financial resources, authorities allege Headley has travelled extensively since 2008, including multiple trips to Pakistan and various countries in Europe.

With files from The Associated Press