Few thing to try. (none a cure, just trying to point to the faulty part).
Leave all your other coding(besides the below) in the state that DOES cause the error.

Try these one at a time. Only combine them if none individually resolve the issue.
1> Try creating the entity from a different MDL file, there maybe something iffy in the model itself.
2> Try creating the entity without any action, in case its the action code causing issues.
3> When you call the ent_create function, immediately after (before any waits) set the ProblemEntity.material = mat_model;

Let us know which (if any) makes the problem stop, then we can see if it is a problem
coming from 1>Model Corruption, 2>LiteC coding, or 3>Shader/Material problems.