Terror suspect David Headley, also known as Daood Gilani, appeared before a judge in Federal Court in Chicago, Illinois on Wednesday.  Headley is charged in connection with the 2008 Mumbai terrorist attack and is also accused of plotting an attack on the offices of a Danish newspaper. 

Forty-nine-year-old David Headley's arraignment before Judge Harry Leinenweber in Chicago was his first appearance since being charged on Monday.  He pled not guilty to allegations he worked with the terrorist group Lashkar-e-Taiba to plot the Mumbai attack that killed 166 people, including six Americans.

U.S. investigators say Headley's travel schedule included five trips to Mumbai in the months leading up to the November 2008 attack,  where he allegedly gathered surveillance used by the attackers.

At a Wednesday Senate hearing on monitoring terrorist travel, Department of Homeland Security Assistant Secretary David Heyman indicated that the circumstances surrounding the Headley investigation are changing the way authorities are looking at potential suspects.

"We can no longer assume that Americans are not involved in terrorism," said David Heyman. "As indicated by the recent indictments, we also see the nexus of travel in those who may get further indoctrinated abroad."

Headley was arrested October 3 on his way to Pakistan.  Court records show his August questioning at Chicago's O'Hare airport after returning from Denmark raised suspicion with authorities.  Headley is also charged with plotting attacks against the Danish newspaper Jyllands Posten, which previously published controversial cartoons of the Muslim prophet Mohammad. 

Headley was born Daood Gilani and is Pakistani-American.  His father was a Pakistani diplomat and his mother is American.  He lived in Washington D.C. and Philadelphia, Pennsylvania and spent time at a military school in Pakistan before returning to the United States.  He moved to Chicago where he changed his name to David Coleman Headley in 2006.  Authorities believe the move was intended to help ease his travel in and out of the United States as he plotted attacks in Denmark and India, and officials admit such a tactic would make identifying potential terrorists difficult.

"This is a challenge," said Heyman. "Those who are seeking to do harm are constantly hearing what we are doing, watching what we are doing, and adapting to that.  So changing names may be one thing.  Changing secure documents.  Changing even biometrics."

David Headley does have a prior criminal record.  He was convicted in 1998 with smuggling heroin and served 15 months in prison.

Indian officials are also seeking more information as they plan to deliver their own charges against Headley in connection with the Mumbai attacks.

Headley's attorney says his client is cooperating with U.S. authorities in the ongoing investigation.  He could change his plea at a later date.

If convicted, he could face the death penalty.