Jurors in the trial of Nathan A. Chapman Jr. heard conflicting descriptions of him Tuesday as an honest businessman who had no reason to commit fraud and as a corrupt executive who misappropriated $500,000 from companies he controlled and lost more than $5 million in Maryland pension funds through fraudulent investments.

As Chapman's trial began in U.S. District Court here, prosecutors said the former chairman of the state university system's Board of Regents was driven by greed. They said he took money from three companies to pay for personal luxuries and extramarital affairs and illegally invested pension funds to prop up the stock price of one of the companies.

"This case is about greed, fraud, betrayal and trust," said Assistant U.S. Attorney Jefferson M. Gray in his opening statement.

But defense attorney William R. Martin, in his opening remarks, suggested that Chapman, 46, whose stock holdings were worth $40 million or more, had no reason to steal. He said any spending by Chapman of company money on personal indulgences should have been caught by company officials. Because no red flags were raised, Martin said, any such expenditures should be viewed as accounting errors rather than criminal matters.

As for the alleged misuse of pension money, Martin said Chapman disclosed the investments to the state's pension board. He also said the state's key witness in that part of the case is a "liar."

Martin said Chapman, a Baltimore native, rose from humble beginnings to prominence as a successful African American businessman and financier of small, minority-held businesses. "He had a dream, as we all do," Martin said. "He had a dream and a vision that once day he'd get up to Wall Street and become a financial stockbroker."

Chapman, appointed to the Board of Regents in 1995 by then-Gov. Parris N. Glendening (D), is charged with mail fraud, wire fraud, securities fraud and other crimes. Authorities blame him for large losses by a pension fund whose beneficiaries include state teachers, police and government employees. The trial is expected to last six to eight weeks.

Gray told the jurors that Chapman improperly took more than $500,000 from the three publicly held companies: the Chapman Co., Chapman Capital Management Inc. and eChapman.com. Chapman was president, chief executive, chairman of the board and majority shareholder of each.

Chapman ordered that checks be issued by the companies for "travel or business development" expenses, Gray said. The disbursements were presented as legitimate business expenses in corporate filings with the Securities and Exchange Commission. "This was all money that was just going into the defendant's pocket," Gray said.

In 1996, Chapman Capital Management acquired an investment trust with holdings in small, minority-held businesses. The state pension fund had a sizable investment in the trust, meaning Chapman had control of that money.

CCM hired Alan B. Bond, a New York money manager, to invest some of the trust's holdings. Even after Bond was indicted in New York on unrelated charges, Chapman allowed him to continue managing trust assets. Bond used that and other money to invest heavily in Chapman's companies, Gray said.

When eChapman was taken public in 2000, technology stocks were collapsing. The stock fell from $13 to $7 on the first day of trading. According to the prosecution, Chapman arranged for Bond to buy 175,000 shares of eChapman.com within days using state pension money. Gray also alleged that the two agreed to predate the sale to make it appear the transaction had occurred when the stock price was still $13 a share.

The transaction, Gray said, "cost the state pension fund more than $1 million in the flash of an electronic transfer."

Late Tuesday, the company, which has since been renamed eChapman Inc., was trading at a penny a share.

Bond is expected to be a key prosecution witness.

Martin sought to blunt the impact of Bond's forthcoming testimony, noting that the former money manager is serving a prison term for fraud. Martin, who said Chapman was among Bond's victims, derided him as a "liar" who "was stealing money from Nate Chapman to the tune of $9 million."

Nathan A. Chapman Jr. is accused of cheating companies he controlled and the Maryland pension system.