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The owner of two bars in Woodside pleaded not guilty Wednesday to charges that he played a role in an illegal immigrant smuggling ring that operated between Ireland, Canada and New York, according to officials at the U.S. Attorney’s Office.

Phillip Reilly, who owns The Cuckoo’s Nest and The Starting Gate, both located in the Irish enclave of Woodside Avenue, had been indicted May 18 for allegedly encouraging three Irish nationals to enter the United States illegally.

The indictment charges that Reilly was involved with a smuggling operation based in Buffalo, where authorities believe Irish nationals were driven across the Canadian border. Through a network connected to a Buffalo restaurant named Campbell’s Pub, the immigrants were then dispersed to other U.S. cities such as New York, Boston and Philadelphia.

At the time of the indictment, Reilly was in Ireland, but returned sometime last week, officials said. He was detained and questioned by immigration authorities and later released on $25,000 bail.

On Wednesday morning, he appeared before U.S. Western District Judge Hugh Scott in Buffalo and pleaded not guilty, according to a spokesman from the U.S. Attorney’s Office. The previous conditions of his bail were continued. If convicted, Reilly faces a maximum sentence of five years in prison.

Reilly could not be reached for comment. When a reporter visited both his Woodside Avenue establishments, employees there were unsure of his whereabouts.

John Caffrey, a Woodside resident who has spoken to community members with knowledge of the situation, said Reilly argues that the press has exaggerated stories of him evading authorities, claiming merely to have been on holiday. Reilly also contends he never accepted any money for helping Irish immigrants, Caffrey said.

“Buffalo has been, for over 20 years, the entry route to the USA for Irish illegals,” Caffrey said. “A good many lived here in the Woodside and Sunnyside area.”

The Buffalo-based smuggling ring has been under investigation since 2004, when authorities charged the owner of Campbell’s Pub with aiding illegal Irish Immigrants. During that case, the owner, Bridget Campbell, pleaded guilty and admitted that between 30-50 Irish nationals had been smuggled into the country. Since then, seven people have pleaded guilty to crimes connected to the ring.

In Reilly’s case, the U.S. Attorney has handed down two separate indictments charging a total of nine people with either attempted entry or aiding and abetting illegal immigration. The three people Reilly is charged with helping – James Shiel, 26, Aiden Tully, 46, and Caroline McConville, 38 – were already arraigned earlier this month.

When authorities began questioning Woodside residents about the investigation in early May, it caused a mild panic among the Irish community, which feared an immigration crackdown could be looming. The Emerald Isle Immigration Center, based in Woodside, issued a statement on its Web site attempting to calm residents but still advising them of their rights.

“You do not need to cooperate with any investigation if you do not want to do so,” the statement reads. “We believe that the guidance, advice and assistance of an experienced attorney is very important in circumstances such as these.”