O.C. Businessman Faces Barrage of New Allegations

A federal prosecutor said Newport Beach businessman Michael E. Parker, who pleaded not guilty Monday to charges of bilking $11 million from Columbia Savings & Loan, is under investigation for bank fraud in two other states, has allegedly threatened former employees and may have stashed assets abroad.

The allegations were made in a bail hearing in federal court here after Parker was arraigned on 46 counts of racketeering, money-laundering, paying and receiving kickbacks, and bank and tax fraud. Jeffrey S. Worthy, Columbia’s former director of financial planning, also pleaded not guilty to similar charges.

The indictment alleges that Parker, former president of Costa Mesa-based Parker North American (PNA), sold $166 million in equipment-leasing deals to Columbia, even though many of the leases were phony. Columbia, which was seeking tax shelters, paid $31 million to PNA between 1983 and 1987. Parker is suspected of misappropriating more than a third of that.

Parker, 43, of Newport Beach, allegedly paid more than $1.5 million in kickbacks to Worthy from April, 1985, to 1987. Worthy, 33, of Downey, allegedly recommended approval of the lease transactions in exchange for bribes.

Columbia, once a high-flying thrift, was declared insolvent and seized by federal regulators in January. Federal thrift officials are seeking $25 million in restitution from Parker, Worthy and another associate for the alleged fraud against the S&L.;

Parker is being held at Metropolitan Detention Center in Los Angeles without bail, and prosecutors argued before U.S. District Judge Robert M. Takasugi on Monday that he should stay there. A new bail hearing was set for Wednesday, and trial is set for April 23.

“It is no exaggeration to say Mr. Parker is one of the worst white-collar criminals this office has ever prosecuted,” U. S. Atty. James R. Asperger said.

He noted that Parker was under investigation in Oklahoma and Nevada for fraud relating to other equipment-leasing deals. Oklahoma’s largest thrift--Sooner Federal Savings & Loan--lost $10 million in a Parker deal, and First Interstate Bank in Las Vegas is out $8 million, Asperger alleged. Sooner was placed into receivership in November, 1989.

First Interstate was one of PNA’s biggest lenders. Sooner, on the other hand, was one of the thrifts that sold its equipment to PNA and agreed to lease it back. Both are now creditors of PNA, which is in Chapter 11 bankruptcy.

Asperger also said Parker or his wife, Cindy, allegedly threatened PNA employees who were cooperating with federal investigators. For instance, Asperger claimed that Parker left a dozen dead roses on the doorstep of PNA employee Bryan Bonas. The accompanying card read “You lose, signed Cindy and Mike,” he said.

Brian W. Fink, a former vice president of PNA now working with authorities, claims that he got a call from Cindy Parker threatening him if he cooperated. “I’ll see to it you’re hurt,” Asperger quoted Cindy Parker as saying. Fink has been charged with conspiracy and tax evasion related to the leases sold to Columbia.

And, Asperger said, Columbia attorney Ken Heitz claims that Parker tried to keep that thrift’s officials quiet by offering them $10 million in cash and stock in Parker Automotive Corp., a Costa Mesa-based maker of engine-cleaning supplies founded by Parker.

“There is real potential for witness intimidation and cover-up,” Asperger alleged.

Thomas E. Holliday, one of Parker’s attorneys, told Judge Takasugi that Parker is not a violent man. “Mr. Parker has fired some of these people, and clearly they have an ax to grind,” Holliday argued. “He doesn’t threaten people. That’s not his style.”

Parker’s sister, Diane, said after the hearing that her brother “is clearly not dangerous. The people who say he is are all disgruntled employees.”

Asperger further alleged that investigators suspect Parker of hiding funds overseas. He said Parker transferred $5 million worth of equipment to London and Switzerland last September and allegedly told Parker Automotive chief financial officer Eric McAfee that he “was creating a cash horde in Europe to keep out of the reach of domestic agencies.” Asperger also claimed that Parker told associates that he had bought all kinds of art and jewelry--including a $450,000 diamond necklace and matching earrings from Moboco Fine Jewelry & Gems in Newport Beach--because they were “untraceable” and easy to sell in Europe.

Parker also was stashing money, Asperger claimed, adding: “He said he loves currency because it can’t be traced.”

But Parker’s attorneys strongly denied these claims Monday.

They said the $5 million in equipment transfers were just routine business for Parker Automotive.

PNA filed for bankruptcy protection from creditors in March of 1989. On Monday, Parker’s attorneys said he has been cooperating in that case. “He has brought forward assets to be turned over to the receiver that no one even knew about,” said Greg Lindstrom, Parker’s bankruptcy counsel.

Asperger portrayed Parker as a big spender, staying in the finest hotels all over the world and renting Rolls-Royces whenever he is in London. Parker, he claimed, lost $1.9 million at Harrah’s casino at Lake Tahoe where several people had seen “briefcases traded back and forth between Mr. Parker and a bookie.”

His defense counsel countered that Parker was a philanthropic man, donating his time and money to charities and civic organizations.

“It’s very easy for someone to be charitable when they have large amounts of money obtained by fraud,” Asperger countered.

Takasugi postponed a decision on Parker’s bail until Wednesday when he will hear testimony from former PNA employees who claimed that they were threatened.