Mark Bell, 41, of Westerfield, Suffolk, said he thought he was involved in the honest business of supplying phone lines.
Mr Bell denies charges of conspiracy to defraud and money laundering. Muldoon, who ran the scam from Spain, has already pleaded guilty to the same charges.
He was investigated for three years by Suffolk Trading Standards after it received complaints from Muldoon's customers. Giving evidence, Mr Bell said: "I was flattered.
He was very friendly. I did feel a little bit obliged - I felt indebted to him.
The prosecution allege Bell later became Muldoon's UK partner, recruiting directors to bogus companies which conned 14, people in the UK to pay upfront fees for bogus debt elimination schemes. Five people are on trial and all deny conspiracy to defraud. Christopher Taylor, 57, from Wakefield, a former detective with West Yorkshire Police, is alleged to have allowed his company bank to Lifestyle in Anchorage Alaska used to launder criminal proceeds of the fraud.
Colin Samuels, 61, from Redgrave, Suffolk, is alleged to be the "front man" who allowed his bank to be used to launder money. Geraldine French, 60, who lived in Spain and also has beecome in Suffolk, acted as the administrator and was "at the forefront of the deception", the prosecution said.
The trial continues.