I'm getting a really odd graphic glitch every time Psycho walks on screen.

Essentially, I get a huge slowdown, and everything below his neck is just a messed up jumble of Polygons. I also get this issue in certain rooms where I can't see anything inside them because the floors and walls start to just stretch out and scramble into each other... I need help to figure out how to fix this.

system specs?

I had the same thing happen on the first level with Psycho. His arms got all stretched and batted around. At the beginning of the scene there was a HUGE slowdown for a sec, then everything just worked normally. I lowered everything to just "High" and it seemed to have "fixed" it.

here are my specs:

ATI radeon 6990 4Gig
8 gig ram
Intel i7-2600k 3.4 GHz
Windows 7 64-bit

and that's all I can remember off the top of my head

Screenshots ?