New Haven — The two Mashantucket Pequot brothers indicted last week on charges that they stole more than $800,000 from the tribe that owns Foxwoods Resort Casino pleaded not guilty Monday in U.S. District Court.

Thirty-eight-year-old Steven Thomas, the Mashantucket Pequot Tribal Council’s treasurer, and Michael Thomas, 44, a former council chairman, were released on $100,000 bonds pending a trial that U.S. Magistrate Judge Joan G. Margolis tentatively set for March 12.

The judge ordered both men to surrender their passports — Steven Thomas’ attorney, Richard Reeve, said his client has been unable to locate his — and confine their travel to Connecticut, Massachusetts and Rhode Island. Margolis also approved Steven Thomas’ travel early next month to Washington, D.C., on tribal business.

The Thomases also were ordered to have no contact with government witnesses unless, in Steven Thomas’ case, his tribal employment requires it. In such instances, Steven Thomas is prohibited from discussing the case, according to a standard “no-contact” provision, which Reeve contested.

As a tribal council member, Steven Thomas needs to have frequent contact with other council members, Reeve said, and also encounters other tribal members and tribal employees named on the list “on a daily basis.” The list of some 20 people, which was not made public, contains the names of many of Thomas’ friends, according to Reeve.

“It’s a little too much Big Brother,” the attorney said.

Assistant U.S. Attorney Christopher Mattei, the prosecutor in the case, disputed the claim that Steven Thomas has daily contact with most of those on the list and said there had been an occasion on which Thomas attempted to intimidate or threaten a witness.

Reeves characterized the case against Steven Thomas as an “employment case” based on the government’s allegation that he accepted wages for work he did not perform.

“This is not about the theft of federal funds,” Reeve said. “This is a case about wages … whether he was entitled to receive payments.”

The three-count indictment against Steven Thomas alleges he stole more than $700,000 in tribal funds from January 2005 through June 2008 while employed as assistant director of the tribe’s Department of Natural Resources Protection. At the time, the department received more than $10,000 a year in federal funds.

Michael Thomas chaired the tribal council from 2003 until August 2009, when his fellow councilors forced him off the council as the tribe’s financial straits came to light. Thomas had gone public with a controversial pledge to put payments to tribal government and tribal members ahead of the tribe’s obligations to its lenders.

The tribe defaulted on more than $2 billion in debt in late 2009. It has yet to secure final approval of a plan to restructure the debt.

In the indictment returned against him Friday, Michael Thomas is accused of stealing more than $100,000 in tribal funds from October 2007 through April 2009. While no details of his alleged wrongdoing surfaced in court, sources have said an FBI probe of tribal finances focused in part on his use of a tribal credit card.

Approached outside the courtroom, Michael Thomas refused to comment, as did his federal public defender, Paul Thomas, who is not related to him.

More than a dozen tribal members attended Monday’s court proceeding.

If convicted of stealing from an Indian tribal organization, each Thomas brother faces a maximum prison term of five years and fines of up to $250,000. If convicted of stealing from an Indian tribal government receiving federal funds, each faces a maximum prison term of 10 years and a fine of up to $250,000 on each count.

b.hallenbeck@theday.com