I live in Houston which is pretty much mold central. I agree with the bleach and water to remove it and also with getting it out of the moldy basement. If it's not possible to get it out of the basement you could try putting it in a large sealable bag (if you can locate one) with one of those packets that absorbs dampness. That might help.
And, yes, mold is very bad for your breathing and is often the source of other "mystery" illnesses.