Legal Woes Cast Michael Parker in Different Light : High life: Once one of Orange County’s up-and-comers, the entrepreneur is being sued by Columbia S&L;, and the FBI and IRS are probing his files.

It must have seemed like a match made in heaven. But instead it has turned into a divorce so messy that even the FBI is on the case.

In 1983, Columbia Savings & Loan Assn., the highflying Beverly Hills thrift with a bulging portfolio of junk bonds, became partners with Parker North American Corp., an equipment leasing firm then based in Newport Beach.

The owners of both concerns liked the high life. Columbia Chairman Thomas Spiegel kept an English butler and a collection of Uzi machine guns and was paid a $3-million bonus one year. PNA chairman Michael Parker liked expensive cars, posh restaurants and making the society columns.

For a long time, both companies appeared to thrive. But earlier this year, Columbia was declared insolvent, a victim of free spending and risky junk bond investments. Before that, in March, 1989, PNA--whose logo was a four-leaf clover--filed for Chapter 11 bankruptcy protection.

Parker’s luck hasn’t gotten much better. The FBI and IRS are investigating his company. Two weeks ago, Columbia filed a civil suit alleging that Parker bilked it out of $13 million and paid kickbacks to one of its former officials. And at least one other S&L; is suing him for fraud.

Neither the Federal Bureau of Investigation or the Internal Revenue Service would comment on the investigation.

Parker denies any wrongdoing. He won’t discuss the case in detail but says he has been questioned by FBI agents several times. The FBI seized records from the Costa Mesa offices of PNA in April.

The investigation raises a cloud over Parker, once one of Orange County’s up-and-comers. Parker was ostentatious but generous with his wealth. He always seemed to be in the limelight and supported the “right” things: charities, the Boy Scouts and Republican causes.

Parker gave his checkbook a workout in Newport Beach, the glitzy Orange County beach town where money flows as steadily as the ocean tide. Parker, 42, wanted to swim in that money-laden tide and seemed willing to do whatever it took to do that.

In one stroke two years ago, he gave $100,000 to the national Republican Party. In October, 1988, Parker gave $70,000 to the state Republican party. He had registered to vote--as a Republican--only five months earlier.

He bought a $1.4-million house behind a guarded gate in Newport Beach’s tony Big Canyon. He keeps a 1984 Ferrari there as well as a Porsche, an Aston-Martin and a Bentley with the license plate “1 PARKER,” all late models.

He made friends easily. One associate said he handed out gifts of Rolex watches “like candy.”

Parker lunched frequently at the plush Ritz restaurant in Newport Beach, where he is a member of the Ritz Brothers, an “old-boy network” of influential businessmen who dine there. Parker knows Ritz owner and society chef Hans Prager well enough that Prager cooked for a 1988 political benefit for Republican Sen. Pete Wilson at Parker’s house.

In fact, the Ritz was where Parker met his second wife, Cindy, who was a waitress there. On their first anniversary in 1988 she rented a billboard in Costa Mesa and had a picture of the couple plastered across it. He bought her a Rolls Royce Corniche. The Times wrote an article about it.

This was all a long way to come for a University of Massachusetts dropout from a close-knit Boston Irish family, a kid who described his only ambition in his high school yearbook as touring the United States in a Jaguar.

“He likes to be the life of the party. He’ll have the whole room in stitches,” says his sister, Diane M. Parker, a vice president of Parker’s newest company, Parker Automotive Corp., which makes engine-cleaning devices. “People like him, and they trust him. But he’s so generous I get worried because I see him getting taken advantage of.”

And his business seemed successful. PNA had found an unusual market: leasing equipment, such as automated teller machines and computers, to banks and thrifts. The company borrowed most of the money to buy the equipment. But it also got investors to put up some of the money in return for the tax breaks from owning the equipment. At the end of the lease the loan was paid up, and PNA and its investors would own the equipment, which they could then sell.

In 1983, Parker, who even detractors admit is an extremely persuasive salesman, lined up Columbia, a rapidly growing and then-profitable thrift, as an investment partner. Between 1983 and 1987, Columbia says it gave $31 million to PNA.

Earlier this year, Columbia was declared insolvent and new management was put in place by federal regulators. Federal regulators have filed an administrative claim seeking the recovery of $24 million in thrift funds allegedly squandered by Spiegel on himself and friends.

The thrift has since checked its records against the bankruptcy files of PNA. What Columbia found was that Parker had invested only $18 million of Columbia’s $31 million, according to a civil lawsuit filed in U.S. District Court in Los Angeles on Aug. 10.

The lawsuit alleges that most of the missing $13 million has gone into Parker’s pocket. Some of it may also have gone to Brian W. Fink, a resident of Orange who was vice president of PNA’s syndication department, and Jeffrey S. Worthy, a former Columbia vice president and director of financial planning, the suit claims.

There were three ways Parker defrauded Columbia, according to the lawsuit:

* He allegedly lied about how much equipment he was purchasing, getting Columbia to invest extra funds, which he skimmed off.

* He allegedly created phony lease agreements. Columbia submitted pages from a separate set of records that Columbia claims Parker, Fink and perhaps others at PNA kept on the deals. On a ledger after almost every entry is the notation: “Documents have been altered.”

* Parker allegedly sold the same investment more than once to Columbia and other investors.

In addition, the thrift charges that Parker paid Worthy, the Columbia official who dealt most closely with PNA, more than $1 million in kickbacks to cover up the deceptions.

Parker says his lawyers won’t let him discuss the Columbia case in detail. But he would say: “What really happened does not bear a resemblance to what they said in their complaint. There have been a lot of actions filed against the management of (Columbia). All I can say is, I’m caught in the same net.”

Worthy, who lives in Downey and left Columbia in 1987, denied he accepted any bribes. “I wasn’t taking any kickbacks,” said Worthy, who says the FBI has questioned him several times. “If there was jerry-rigging of deals, it was done previous to me receiving” the paperwork from Parker.

“Columbia is a financially bankrupt company,” said Worthy, who says he became disillusioned with the thrift’s business practices and left in 1987. “But it’s been morally and ethically bankrupt for years.”

Fink would not comment.

PNA was not Parker’s first business failure.

Parker started his first business in 1971 in a Massachusetts garage while still in his early 20s. That company, North American Video Corp., sold and leased video equipment to banks. The company, which moved to California in 1976, soon expanded into other types of equipment and got overextended.

“It was a resounding flop,” Parker admits now.

Former employees and creditors remember the company being heavily in debt. In 1981, Parker sold it for $1 to Santa Monica’s Wickes Cos., the auto parts and home furnishings manufacturer, which had acquired one of Parker’s creditors.

That same year he started the leasing concern. Things were fine for PNA until 1986, when Congress changed the tax laws and abolished or reduced some of the tax shelters that leasing companies sold.

That meant that Parker had fewer tax shelters to offer investors, and the business began drying up. But Parker found a new market: He began offering to buy equipment and office furniture from savings and loan associations and lease it back to them. Some of those thrifts needed a quick shot of capital like this to keep federal regulators at bay.

But as the savings and loan crisis grew deeper in the late 1980s, it got harder for Parker to persuade banks to lend money for deals.

“It was my own stupidity,” Parker says now. “I should have realized in ’85 that it’d be hard to make a profit in the leasing business. But I liked having a big company, and I let my ego get in the way of my brain.”

By the time PNA filed for bankruptcy protection in early 1989, it had promised to buy millions of dollars in equipment from several savings and loans and had legally obligated them to pay the lease payments. And it had borrowed the money to buy the equipment from several banks.

According to its bankruptcy petition, PNA owed $39 million when it filed for court protection from creditors. The company filed so quietly--using the initials PNA and not the full corporate name--that lawyers for one of its creditors accused the company of filing under a false name to avoid publicity. Parker had resigned as president the day before the filing.

Even as PNA was going down, Parker appeared to take care of himself. In 1988, he was paid $733,000, according to bankruptcy filings. Revenue for the company isn’t available for that year, but it had reported revenue of only $10.7 million the year before.

Money from PNA also went into Parker Automotive right up to the moment the leasing firm filed for Chapter 11. The leasing company loaned $800,000 to the auto company in December, 1988, at an interest rate of 9%, well below the 10.5% prime rate that banks charged their most favored borrowers at the time.

And Parker, now chairman, chief executive and president of Parker Automotive, recently negotiated a big salary. The company will pay him $250,000 a year, a hefty figure for a company with only $2.2 million in sales last year. (The company projects that sales will jump to $20 million this year.) The deal also entitles Parker to a percentage of pretax profits and options to buy more stock.

Despite his problems, Parker recently persuaded two Orange County heavy hitters to go on the board of his new company: Sir Eldon Griffiths, a conservative member of the British Parliament who lives here much of the year, and Timothy L. Strader, a local Republican activist and developer.

But Parker, whose once-boyish face now looks puffy and tired, drags on a Marlboro in his office, surrounded by family pictures, and says he’ll resign from Parker Automotive too if his legal woes continue.

That seems likely to happen. Besides the Columbia suit and federal investigation, at least one other thrift has a lawsuit against Parker to recover its money, and several others claim in the bankruptcy filings that they were defrauded by PNA.

Far Western Bank in San Diego is going after Parker personally to get its money back. It may have to.

“There’s very little chance (PNA) will be able to pay everyone who’s owed 100 cents on the dollar,” says Michael Lawler, a Los Angeles consultant who’s steering PNA through bankruptcy.