McNall Being Investigated by Grand Jury : Jurisprudence: King owner’s loan documents at center of probe. Sale of the team could be in doubt.

King owner Bruce McNall is being investigated by a federal grand jury looking into whether he falsified loan documents, a development that has thrown into doubt his plan to sell a majority interest in the hockey team in a deal that was to have closed today.

A spokesman for McNall confirmed to The Times on Thursday that an investigation had started.

In a separate interview, Tom Pollack, a partner and criminal lawyer at Irell & Manella who has been retained by McNall, said: “An investigation is just an inquiry. Many such inquiries result in no government action. Mr. McNall believes that once the government completes its inquiry, no action will be taken.”

Pollack added that “to the best of my knowledge, this investigation does not involve any alleged wrongdoing on the part of the Los Angeles Kings.”

Officials at the U.S. Attorney’s Office in Los Angeles declined comment.

Sources familiar with the investigation told The Times that several key McNall employees received subpoenas last week at home and at McNall’s offices requesting that bank and other financial records be turned over to a grand jury.

The sources said that individuals have not yet been subpoenaed to testify before a grand jury. Sources said that the subpoenas were general in nature, and do not list specific loans.

McNall’s single largest lender is Bank of America, which is owed $92 million. Other banks that do business with McNall-affiliated companies include Bank of California and the French bank Credit Lyonnais, according to court records and sources.

Although the specifics of the investigation have not been made public, McNall has been accused of bank-related irregularities in court papers before.

In a lawsuit filed in February, Ira and Lawrence Goldberg, partners with McNall in Superior Stamp & Coin in Beverly Hills, alleged he misused company money for other ventures. In a sworn statement, Ira Goldberg said that McNall “falsified Superior’s 1993 year-end inventory statement with the intent to mislead Superior’s auditors and the Bank of California” by listing as Superior inventory--and therefore as collateral--coins that Goldberg says really belonged to a McNall-organized coin fund.

The Goldbergs alleged in the now-sealed documents that McNall used $4.6 million from a bank credit line. They also said McNall used Superior money because he “desperately needed funds to maintain his other ventures and his extraordinary life style.” A tentative settlement has been agreed to, but has not been made final.

The investigation is the latest in a growing list of problems for McNall, who last June was relishing in the success of the Kings for making the Stanley Cup finals and who has long enjoyed a reputation as having a golden touch when it comes to making money in rare coins and other fields.

McNall, 44, is being sued in New York for $28.3 million for allegedly defaulting on a loan to Dutch-owned European American Bank--a debt he disputes even exists--and also has agreed to pay Torrance-based Republic Bank $2.1 million after defaulting on a loan.

Other creditors suing McNall for payments allegedly owed include the owner of the building where his offices are located for back rent, movie studio Twentieth Century Fox for allegedly failing to pay back money advanced on a film and a company that repaired a jet engine for the Kings’ team plane.

McNall also recently told Vanity Fair magazine he once routinely broke foreign export laws in his transactions with overseas coin and artifacts dealers.

McNall has been trying to sell 65% of the Kings for $60 million to telecommunications executive Jeffrey P. Sudikoff and partner Joseph Cohen as part of a larger effort to rid himself of his Bank of America loan.

The sale of the Kings was supposed to be a major step in addressing McNall’s growing financial problems, which have stemmed from such factors as steep debt payments, a soft market in rare coins and what he has described as a financially unfavorable lease the Kings have with the Forum.

The sale was approved last week by the NHL’s board of governors, of which McNall is the chairman, and until the last few days appeared headed for conclusion when the investigation came to light. Sources close to Sudikoff and Cohen said that Sudikoff’s prospective lenders--believed to be insurance companies--have been alarmed by the news and are reluctant to finance the deal.

A spokesman for Sudikoff and Cohen said that the two remain committed to doing the deal and declined further comment.

Several sources say that Sudikoff has been involved in intense talks with Bank of America to possibly finance the acquisition temporarily until questions surrounding the McNall investigation are cleared up, at which time Sudikoff would then secure permanent financing to pay off the bank.

Should Sudikoff and Cohen drop out as prospective buyers, the future of the team would be thrown into doubt. Sources confirmed that Sudikoff has already paid some $4 million to help cover the Kings’ payroll. He also is known to have financed the purchase of a $275,000 Rolls-Royce convertible that McNall presented to Wayne Gretzky in a highly publicized ceremony on March 30 after Gretzky broke Gordie Howe’s NHL record for goals scored.

An NHL spokesman said Commissioner Gary Bettman had no comment.

Times staff writer Jim Newton contributed to this story.