Skokie Businessman, Former Partner Of Michael Jordan, Sentenced In $1 Million Fraud Scheme

CHICAGO — A federal judge sentenced a retired Skokie business owner and former business partner of Michael Jordan to more than a year in prison for a yearslong fraud scheme.

Donald Mudd, 66, pleaded guilty to the charge in February, admitting that he defrauded a sealants manufacturer out of nearly $1 million by submitting inflated commissions and false invoices.

Mudd was the president of Mudd-Lyman Sales and Services, a marketing company he founded in 1980, as well as the manager of Simply Service LLC, both of which were based in Skokie.

According to a memo from his defense attorney, Mudd had a relationship with the sealants company, General Electric subsidiary Momentive Performance Materials, for three decades.

Before getting involved with his co-defendant Rodney Hawkins, the vice president of the company Mudd defrauded, there was never in impropriety in his dealings with the company, his attorney said.

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But when Hawkins came to Mudd in 2009 with personal financial troubles related to the adoption of a child and debts owed by in-laws, Mudd began giving him money improperly, his attorney said. According to his guilty plea, he began covering up the illegal payments with fake documentation and splitting the ill-gotten gains between them.

A resident of Palm Beach Gardens, Florida, Mudd was the president of the Medalist Golf Club during some of the criminal scheme, which lasted from at least 2009 to 2014, according to prosecutors.

"Later in the 2010s, [Mudd] was a business partner with Michael Jordan and was involved in opening Jordan’s Florida golf club, The Grove XXIII golf Club," Assistant U.S. Attorney Michelle Peterson said in a sentencing memo.

Federal prosecutors had sought a sentence of 27 months in prison, while Mudd's attorney asked U.S. District Judge Elaine Bucklo to give him six months of house arrest.

"[Mudd's] criminal conduct was repetitive and willful," Peterson said. "[His] dishonesty was not a single lapse of judgment, but rather, involved years of deceit. He simply thought he could get away with taking almost a million dollars from [Momentive Performance Materials]. The sentence imposed must show otherwise."

In seeking a more lenient sentence, Mudd's attorney cited his health issues and his role as his wife's primary caregiver.

"[Mudd's] commission of this offense was a betrayal of the values that otherwise guided him throughout his life, but he is committed to living the remainder of his life in accordance with the values he holds dear," Sheldon Zenner said.

"[He] knew that he was guilty, he knew that he had done wrong and he had acknowledged it to family and friends," Zenner said. "Given his age and his wife’s age and knowing that incarceration certainly was a real possibility, he decided that putting off his public acceptance of responsibility and punishment was not what he wanted to do."

In addition to 15 months in prison, Bucklo also ordered Mudd to pay a fine of $60,000 and $951,755 in restitution.

Hawkins, 57, of Newton, North Carolina, pleaded guilty last year and admitted his role as Mudd's co-defendant. He is due to be sentenced July 10.