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Two Americans Detained in Death of Irish Exchange Student in Tokyo; International Outrage Rises after Latest Massacre in Syria; Tony Blair Assures Leveson Inquiry There Was No Special Relationship with Murdochs; Russian Carmaker Lada to Discontinue Classic Series

Aired May 28, 2012 - 08:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

KRISTIE LU STOUT, HOST: I'm Kristie Lu Stout in Hong Kong. Welcome to NEWS STREAM where news and technology meet.

And we begin in Syria where Kofi Annan has arrived as there is international anger over the slaughter of civilians in the town of Houla.

And we look at the rise of anti-foreigner sentiment in China.

And is Facebook set to launch its own phone?

Now international fury is mounting of a horrifying massacre in the Syrian town of Houla. The UN Security Council is condemning the killings of more than 100 men, women, and children. Now UN envoy Kofi Annan has arrived in Damascus and he is to hold talks with Syrian president Bashar al Assad on Tuesday, but some rebel leaders say Annan's peace plan for Syria is dead.

Now Syrian government denies being involved in the Houla deaths with officials blaming its enemies for the massacre. But witnesses say pro- government thugs shot some victims at close range. And nearly half of those killed were children.

Now we must warn you, we are about to show you images of some of those dead children. They are disturbing and not appropriate for all viewers. But given the nature of the attack and the number of dead, we believe that showing them is necessary to convey the extent of this crime against humanity.

Here's Mohammed Jamjoom.

(BEGIN VIDEOTAPE)

MOHAMMED JAMJOOM, CNN INTERNATIONAL CORRESPONDENT: In Houla, more burials. More than a 100 dead. So many, so many in one day. And such grief and such rage.

49 of the victims posed no threat to anybody, least of all the regime in Damascus. They were children not yet 10-years-old.

"By god, I washed the dead bodies of little children, one was less than 9 months old. Why are they treating us like animals. We are human. Did the infant carry an RPG? Was he a fighter? He was a baby. He had a pacifier in his mouth. What was his guilt? Why was he killed?"

Opposition activists accuse the Syrian government and its thuggish militias of carrying out this massacre. The Syrian government blame terrorists for the killings and called the allegations against them a tsunami of lies.

JIHAD MAKDISSI, SYRIAN FOREIGN MINISTRY SPOKESMAN (through translator): We absolutely deny that the government armed forces had any responsibility in committing such massacre. And we strongly condemn the terrorist massacre.

JAMJOOM: The United Kingdom's foreign minister said the world had heard that line from Syria and its backers before.

WILLIAM HAGUE, BRITISH FOREIGN SECRETARY: That is a familiar tactic of the Assad regime to blame others for what is happening in the country to try to get out of responsibility for the scale of death and destruction.

JAMJOOM: In Houla, more amateur video attesting to that death and destruction. Here, the bodies of more than a score of women and children stuffed into a small room.

And these pictures are the ones we warned you about, pictures agonizing to watch, children's bodies mangled and bloodied, some with skulls torn open.

UN observers arriving on Saturday to begin their investigation found a mass grave. With no power to stop the violence, they issued yet another call for calm and reason.

MARTIN GRIFFITH, DEPUTY HEAD OF U.N. MISSION, SYRIA: The first thing to do is to stop the fighting, stop the violence, so that we can then get on to helping the wounded and of course the bodies of those who lost their lives.

JAMJOOM: The United Nations Security Council rushed into a special, but brief meeting.

The deputy ambassador from Russia, which can veto any Security Council resolution dashed any hope for quick action.

ALEXANDER PANKIN, RUSSIAN DEPUTY U.N. AMBASSADOR: It's difficult to imagine that the Syrian government would not only shell and mortar, but also use point blank execution against 40 plus women, 30 plus children under age 10.

JAMJOOM: And as outrage continues to mount around the world, the finger pointing goes on in a massacre hard to comprehend for its callous brutality. The young continue to pay the price for a cease-fire written on paper only.

(END VIDEOTAPE)

LU STOUT: Some horrifying images there.

Now Mohammed Jamjoom, he joins us now live from Beirut Lebanon where he's following developments in neighboring Syria. And Mohammed, is this massacre a turning point in the crisis? Could it somehow spark an intervention to end the violence?

JAMJOOM: Well, that's the key question right now, Kristie. Although opposition activists in Syria are begging the international community for help, for some sort of intervention and the rebel Free Syrian Army is calling on the UN Security Council to start air raids and attack targets of the Syrian regime in Syria, there's no telling what the UN can do.

The problem is the UN Security Council still not speaking with one voice on this issue, even though there's more and more international condemnation of this massacre that happened. And there's more and more members of the international community laying the blame directly at the feet of the Syrian regime of President Bashar al Assad, you still have members like Russia that are -- that have veto power.

And yesterday the UN deputy secretary there at the UN, the Russian deputy secretary had said that it was hard to imagine that the Syrian government would shell its own people and would then kill its own people in Houla in cold blood.

So what exactly the international community can do at this point, there's just no telling whether there's been Arab League monitors on the ground there for now with the UN monitors that are there, about 300 in numbers, the violence has continued and doesn't look like it will stop any time soon, Kristie.

LU STOUT: And now we have Kofi Annan, he has arrived there in the Syrian capital for talks. He is trying desperately to save his peace plan and to end the violence. But is there any chance he can succeed?

JAMJOOM: Well, Kofi Annan certainly wants to succeed. He's now arrived in Damascus. He's going to have talks with Syrian president Bashar al Assad today. He announced that he was shocked and horrified by what happened in Houla. And that an investigation would happen. Here's more of what Kofi Annan had to say.

(BEGIN VIDEO CLIP)

KOFI ANNAN, UN SPECIAL ENVOY TO SYRIA: The Security Council has requested the United Nations to continue to investigate the attacks in Houla. Those responsible for these brutal crimes must be held to account. I understand the government has been issued an investigation.

(END VIDEO CLIP)

JAMJOOM: Mr. Annan also said that the Syrian government must prove that it really is going to take bold steps to try to resolve the crisis in Syria. And said that that six point plan needs to be implemented in full, that so far it hadn't been.

But the question remains if this can actually happen, even with Kofi Annan's presence in Syria, more and more member of the international community suggesting over the past few weeks that not only is Kofi Annan's peace plane in tatters, that it is dead at this point. And the rebel Free Syrian Army yesterday came out with a statement urging retaliation and promising retaliation against the government there and saying that Kofi Annan's peace plan was dead -- Kristie.

LU STOUT: So is that what we're going to see ahead, more retaliation, more violence, more bloodshed?

JAMJOOM: As of now it looks like we're still seeing bloodshed. Yesterday some very disturbing reports out of Hamaa. Opposition activists saying that that city was shelled and that at least 28 people killed in one day alone. We've seen some very graphic video. We can't authenticate that video, but it purports to show the bodies of men, women, and children there lying in a mosque, the victims of that shelling as is claimed by the opposition activist groups in Syria.

So you're still seeing violence. We're still hearing about violence even in light of what happened in Houla, even in light of the fact that so many members of the International Community strongly condemning the Syrian regime saying that they are being the violence in Syria. Of course the Syrian government saying that they have nothing to do with this, blaming the violence that's going on there on terrorist groups and al Qaeda. But the violence seems to continue. And it really doesn't look like it will stop any time soon -- Kristie.

LU STOUT: Mohammed Jamjoom reporting for us. Thank you very much indeed for filing that for us.

Now both Russia and China, they have resisted efforts by the UN for tough action in Syria. Russia's foreign minister says that Moscow does not support the Syrian government, but it does support Kofi Annan's peace plan. Now he held talks with his British counterpart. And Phil Black joins us now live from CNN Moscow.

And Phil, Hague has been calling on Russia to punish Damascus. How is Moscow responding?

PHIL BLACK, CNN INTERNATIONAL CORRESPONDENT: Well, in the past, Kristie, certainly the differences between Russia and the international community were over the issue of punishment, that's what Russia refused to do in the Security Council to allow any sort of hard pressure or measures to be taken against Syria. Now, though, the issue is about pressure.

Russia and Britain both say they support the Annan peace plan. Syria has signed on to the Annan peace plan, made certain undertakings and commitments, but everyone, including Russia, believes that Syria is not living up to those commitments adequately. It still has a long way to go. Russia says it does pressure Syria, it does so almost daily it says. And it would not even have signed up to the Annan plan had Russia not pressured it to do so.

So while Russia says it is prepared to continue this sort of pressure on Syria, it is still not yet prepared to blame the Syrian government or regime, even in the case of this massacre in Houla. There, the foreign minister of Russia sERGEY Lavrov says that this appears to be a situation where both parties, that is Syrian opposition and the Syrian government, were involved. Here's a little more of what he said on that point.

(BEGIN VIDEO CLIP)

SERGEY LAVROV, RUSSIAN FOREIGN MINISTER (through translator): So we insist on investigating the situation in Houla as well. We don't tell that the government did use artillery and tanks. And this has been reported by UN observers who went to the site. But it is equally clear that a lot of bodies had gunshot wounds from small arms at close range and wounds on some people indicate that they were just beaten to death.

So we have to be objective. We are not excusing the government and -- but we need to investigate this thoroughly and find out who is to blame there. We all need to make -- all we can -- do all we can to make sure this never happens again.

(END VIDEO CLIP)

BLACK: So Russia says it is doing its part, it is pressuring Syria to live up to its commitments to the Annan peace plan, but it believes that there are other countries that are now. And he's even accused -- the foreign minister has accused other Gulf Arab states of undermining that peace plan by encouraging the Syrian opposition to undermine the peace plan and look to some sort of excuse that would justify international intervention, Kristie.

LU STOUT: OK. Hague and Lavrov, they're both saying that they are sticking to Annan's peace plan, but it's failing. Some Syrians are saying that it's simply not working, it's dead. So is there another plan to stop the violence in Syria?

BLACK: The short answer is no there isn't. And that is why international figures such as Hague and Lavrov and other members of the international community are not declaring this process dead just yet. William Hague, the British foreign secretary said today that it's not a choice between the Annan peace plan and some other constructive option. He said it is a choice between that peace plan and continuing escalating violence and chaos, or descent into civil war. So without any other clear option on the table, Kofi Annan is still working on this plan and other members of the international community and still supporting him in doing so.

LU STOUT: Yeah, it seems that there's so much international outrage, but not much action ahead, or meaningful action. Phil Black joining us live from Moscow, thank you very much indeed for that.

Now to Egypt where its electoral commission is soon set to announce the results of last week's presidential election. Now unofficial results, they put the Muslim Brotherhood's Mohammed Morsi as the frontrunner with foreign Prime Minister Ahmed Shafik close behind. Now if no one receives more than half the votes, a run-off will be held next month between the top two candidates.

And later in the show I'll be speaking to Ben Wedeman live from Cairo.

Now up next, he was the UK's most powerful man, but some say he got there with the help of the most powerful man in media. But just how close were Tony Blair and Rupert Murdoch? We'll be live from the Leveson inquiry.

And for years, China has been opening up to the west, but is it closing its doors again? Stan Grant reports on a surge in anti-foreign sentiment.

And a series of arrests in the top tier of Italian football threatens to expose the ugly side of the beautiful game. Now the latest on a new match fixing scandal coming up.

(COMMERCIAL BREAK)

LU STOUT: Now former British Prime Minister Tony Blair has told the Leveson inquiry into media ethics that his government ascribed too much power to the press, but he denies doing a deal on media policy with Rupert Murdoch in return for political support. Now Mr. Blair was instrumental in building the bonds between the press and politicians that Lord Justice Leveson is currently scrutinizing. They told the inquiry those bonds can become unhealthy, but says he and Murdoch did not become personal friends until after he left office.

Now the former Labor Party leader says that tackling the power of the media during his time in office would have led to a, quote, "absolute major confrontation lasting years."

Dan Rivers is outside the inquiry in central London. And he joins us now. And Dan, tell us more about what Tony Blair revealed about his relationship with the press and the power of Rupert Murdoch.

DAN RIVERS, CNN INTERNATIONAL CORRESPONDNET: Well, I think he was pretty open in acknowledging the power of Rupert Murdoch, but was insisting at the same time that the relationship was professional, it was perfectly sensible. He maintains that to want to engage with Rupert Murdoch was one of the world's biggest media players, but that that relationship did not influence their policy he insisted, that there was no sort of quid pro quo, you know, changing policy that would be favorable for Murdoch's media interest in return for favorable coverage in his newspapers. And also insisting that Rupert Murdoch was not a tribal Tory, but then he said were very meritocratic anti-establishment, but denied it was a cozy relationship, said it was a working relationship.

Events, then, just before they broke for lunch took a rather dramatic turn when a protester somehow managed to get into court 73 in the Royal Courts of Justice behind me and made this rather dramatic intervention.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: This man should be arrested...

UNIDENTIFIED MALE: Excuse me...

UNIDENTIFIED MALE: JPMorgan paid him off for the Iraq war three months after we invaded Iraq. They held up the Iraq (inaudible) for 20 billion. It was then paid $6 million every single...

(END VIDEO CLIP)

RIVERS: This is David Lawley-Wakemin who is a 49-year-old self- proclaimed documentary maker who has made films about the war in Iraq. I managed to speak to him very briefly after he was led away by security officers. It appears he had some sort of pass on him in order to get into the court, behind the court. Clearly there's going to be serious questions about how on earth he managed to get access to sort of behind the scenes when not even the press are allowed to go.

But Tony Blair was very quick in insisting he wanted to refute those allegations made to him. Here is what he said.

(BEGIN VIDEO CLIP)

TONY BLAIR, FRM. PRIME MINISTER OF BRITAIN: Can I just say actually on the record what he said about Iraq and JPMorgan is completely and totally untrue. I've never had a discussion with them about that or any relationship between them and...

UNIDENTIFIED MALE: You're entitled to say what you want, but you should not feel it necessary to answer somebody else's points.

BLAIR: No. I appreciate that. But one part of the difficulty with modern politics, and I say this not as a criticism of the media, is that in my experience the reporting of these events is that you're going to have 1,000 people in a room and someone gets up and shouts or throws something that's the news.

(END VIDEO CLIP)

RIVERS: So how many -- in a sense he's right, because that's what we're talking about now. But that's the kind of issues that he was very insistent that in fact the strongest lobbying from any media interests came not from Rupert Murdoch but actually from the BBC from its license fee and consistently denied having changed any policy as a result of any pressure from Rupert Murdoch and described as absurd the idea that we would seek permission from Rupert Murdoch before any change of politics -- Kristie.

LU STOUT: All right. It was interesting that the protesters there protesting not necessarily against Tony Blair's relationship with the media, but his role in Iraq and Afghanistan. Dan Rivers reporting live from central London, thank you.

Now up next, China says it welcomes foreigners but some westerners say they don't feel it. We'll tell you how Beijing is taking action against people who are there illegally.

(COMMERCIAL BREAK)

LU STOUT: Live from Hong Kong you're back watching NEWS STREAM.

Now Chinese media report that two young men have set themselves on fire in the Tibetan capital. Tibetan rights group says this is the first self-immolation inside Lhasa. It happened outside the city's holiest site: Jokhang Temple. Now Xinua reports one of the two men has died, the other is said to be seriously injured but in stable condition. Now self immolation has become a common form of protest for desperate Tibetans. They accuse Beijing of repression. As many as 34 cases have been reported since March of last year.

Now meanwhile, Beijing is considering a visa waiver to boost tourism. Now according to the China Daily Newspaper foreigners would be allowed to stay in the Chinese capital for three days. Now this comes just weeks into Beijing's crackdown on foreigners living and working in the city illegally.

Now that campaign runs until the end of August. And China insists, quote, stricter rules don't mean that China's openness and inclusiveness to foreigners are changing, but mean better management. Now that comes from a recent Xinua article. But as Stan Grant found, some westerners feel differently.

(BEGIN VIDEOTAPE)

STAN GRANT, CNN INTERNATIONAL CORRESPONDENT: We can't use this woman's real name. We'll call her Emily. From Boston in the U.S. she's been in China less than a year to learn the language. Now Emily is nervous about speaking it. She fears she may soon be kicked out of China. Her visa likely to be denied.

EMILY: I was already planning to leave in mid-June for my vacation and that just means I wouldn't be able to come back.

So I'm going on my vacation home with all of my belongings in case I'm not able to come back.

GRANT: Emily is just one of a rising number of foreigners targeted in a visa crackdown. The government is in a midst of a 100 day sweep against what it calls illegal foreigners. But it seems all non-Chinese risk being caught up in the crackdown. Police rounding up people in bars and night clubs.

EMILY: There's a bar right near my house, like two blocks from my house, where according to Twitter they lock the doors and kept all the foreigners inside for a good hour to an hour-and-a-half. And they were taking pictures of them apparently.

GRANT: This video has fanned already dangerous flames of anti-foreign fervor in China. Posted online, it reportedly shows a British man sexually assaulting a Chinese woman. Her screams alert bystanders who not only film the alleged attack, but hand out their own brutal justice. The man is now in jail pending trial. But an isolated incident is now being used to fan nationalism with cries of foreigner go home.

"I'd just beat him to death on the spot."

"China is a big nation. We should get tougher. We've been too soft for too long."

A Chinese news anchor has seized on the furor. In a blog posted online, Yang raved demands China, quote, "clean up foreign trash, to arrest foreign thugs, and protect innocent girls." He claims foreign spies use Chinese women as cover.

This satirical cartoon mocks the anchor as a puppet, a Communist Party mouthpiece. He has declined our requests for an interview and in the face of criticism has tried to downplay his comments. But to many, the damage is already done.

On nights like this, it's not hard to see foreigners and local Chinese side by side, but the concern now is that anti-foreign sentiment could rapidly get out of hand and create dangerous divisions.

The Communist Party often repeats the mantra of 100 years of foreign humiliation to unite the Chinese people. State media is awash with anti- American headlines. In a year of leadership transition, the party is especially nervous. And analysts say nationalism is a handy diversion.

But China's foreign ministry insists, quote, "there is no anti- foreigner trend in China. The country will welcome and protect the legitimate rights and interest of the foreigners coming to China."

For now, Emily is legal. But her visa is fast running out. And Chinese security is watching and waiting.

Stan Grant, CNN, Beijing.

(END VIDEOTAPE)

LU STOUT: Now up next here on NEWS STREAM, the votes are in and the result will be out very shortly. But how far will the first round of presidential elections in Egypt go toward forging a stable future for the country.

And two Americans are held after an Irish exchange student is killed in a Japanese hotel. We'll bring you the latest on this murder mystery.

(COMMERCIAL BREAK)

LU STOUT: I'm Kristie Lu Stout in Hong Kong. You're watching NEWS STREAM. And these are your world headlines.

Now UN special envoy Kofi Annan has arrived in the Syrian capital Damascus. He's trying to revive a ceasefire plan that rebel leaders already say is dead. International outrage is growing after Friday's massacre in the town of Houla. And Russia's foreign minister says ending the violence is more important than who is in power.

(BEGIN VIDEO CLIP)

LAVROV (through translator): We do not support the Syrian government. We are supporting the Kofi Annan plan that addresses both the Syrian government and the armed opposition. You know it takes two to dance, it takes two to tango. Even though in the current situation in Syria what we have is not the real tango (ph) we seem to be having a disco party.

(END VIDEO CLIP)

LU STOUT: Now former British Prime Minister Tony Blair says it is inevitable and essential that top journalists and politicians have close relations, but he is acutely aware that the relationship can be unhealthy given the power of the press. Now Blair is giving evidence at a judicial inquiry into media ethics.

Now Egypt's electoral commission is expected to announce the results of last week's presidential election one hour from now. Now if no candidate gets more than half the votes, a run-off between the top two candidates will be held next month.

Now unofficial reports put the Muslim Brotherhood's Mohammed Morsi first with former Prime Minister Ahmed Shafik a close second. With more on what to expect, let's go live now to Ben Wedeman. He joins us from our bureau in Cairo. And Ben, is it pretty much pretty sure that we do know who will likely go on to the second round?

BEN WEDEMAN, CNN INTERNATIONAL: Yes, even though the final results are going to be announced, Kristie, in about half an hour, in fact all that information is essentially leaked out and it does appear almost certain that Mohammed Morsi, the 60-year-old candidate for the Muslim Brotherhood, did win the most votes, most estimates putting it at about 26 percent of the vote, followed by Ahmed Shafik, the last prime minister under Hosni Mubarak coming in second, and third is Hamdi Sabahi, a Nasserist. That means that we will have basically a representative of the Mubarak regime running off against the head, or rather a leader of the Muslim Brotherhood.

And really it's -- Egypt is coming full circle. There is an old, old struggle between Islamists on the one hand and secular authoritarians on the other. So for many Egyptians they feel like in a sense the revolution never happened and we're back to where we started from -- Kristie.

LU STOUT: And in the event that there is an election victory for Ahmed Shafik, would that mean a return to the policies of Hosni Mubarak?

WEDEMAN: Not really. I mean, you have to take into account that Egypt has changed fundamentally since the fall of the Mubarak regime in February of last year. The population is politicized, people are very much engaged in the political process. You still have a parliament which is dominated by Islamists, whether the Muslim Brotherhood or the Salifist Nour Party. And so they will in a sense be an effective counter balance to any authoritarian tendencies that Ahmed Shafik might show.

So there's no question that Egypt is not going back to a dictatorship, it's just going to be a very interesting political mix with, as I said, the old regime represented by Ahmed Shafik facing off against a very powerful Muslim Brotherhood.

And of course we don't know what the final vote is going to be on...

LU STOUT: Of course, you know, and I am stepping ahead of ourselves a little bit here. But many viewers are curious about these scenarios. Especially tell us more about the Muslim Brotherhood. How would a victory if it plays out that way for the Muslim Brotherhood, what would that mean for Egypt. Do they want a democracy? Do they want to see Islamic law? How would they change Egypt?

WEDEMAN: Well, we have to keep in mind that because both of these candidates really only just won a quarter of the vote and only half of Egyptians who were eligible to vote actually voted, that both of them are going to have to broaden their appeal. The Muslim Brotherhood is going to have to play down some of the more strident rhetoric they used during the first round when they appealed really to their base by talking about implementing Islamic law and whatnot. And Ahmed Shafik, who really sort of played the tough cop, the man who said he would restore order even if that required some fairly brutal methods then he would do it.

Now they have to really appeal to a broader base. And this may result in the softening of their positions.

The Muslim Brotherhood says that they will respect all Egyptians, Christians as well as secular liberal Egyptians, so we will see over the next three weeks how their positions changed. And of course many people in Egypt are worried about the possibility that he Muslim Brotherhood will win the presidency, foremost among them for instance, Egypt's Coptic Christian minority which makes up about 10 percent of the population. They obviously are not enthusiastic about the possibility of a Muslim Brotherhood president -- Kristie.

LU STOUT: You know, it will be interesting to see this jockeying for wider political support play out in the month ahead. You'll be on the story for us of course. Ben Wedeman reporting live from Cairo. Thank you.

Now two American men have been arrested in Tokyo as police investigate the death of an Irish exchange student. Now 21-year-old Nicola Furlong was found dead in a hotel room last week. As Kyung Lah reports, more officials believe that she was strangled.

(BEGIN VIDEOTAPE)

KYUNG LAH, CNN INTERNATIONAL CORRESPONDENT: An unfolding international murder mystery here in Tokyo. A young Irish exchange student who just celebrated her 21st birthday found unconscious and unresponsive at this Tokyo Shinjuku district hotel. She later died.

Tokyo metropolitan police say 21-year-old Nicola Furlong was killed by suffocation by cervical compression or strangulation. The Kyoto news agency says that Furlong and an Irish friend went to a Nicki Minaj concert Wednesday night when they were approached by two American men. Police say the two Irish women and two American men arrived here at the hotel around 1:00 am by taxi. Three hours later, a hotel guest complained of a loud noise coming from a room. When hotel workers got to that room they heard someone saying in English she's not breathing. Police say Furlong was unconscious. A 19-year-old American man the only other person in the room.

The Furlong family spokesman, a priest, tells CNN by telephone from Ireland that this loss is incomprehensible.

JIM FITZPATRICK, NICOLA FURLONG'S PASTOR: Everybody is a little bit devastated in the local area, because this section of the parish of which Nicola belongs is very small, rural end of the parish in which there are only maybe 300 or 400 families in total. So I mean, all in all the families would know each other quite well.

And when something of any nature happens, it has a huge impact. And the death of a young person happens especially everybody knows and everybody is in some way involved, or concerned.

LAH: Police arrested the two American men. They are in these cars being transferred from the police station to an undisclosed location. Police say they are both entertainers, a 19-year-old dancer, a 19-year-old is considered a minor here in Japan. And 23-year-old James Blackstone. He is a dancer. Neither men have been directly charged in Furlong's murder, rather they are being held for fondling Furlong's friend in the back of a taxi. Meanwhile, police are trying to investigate who may have killed Furlong.

Kyung Lah, CNN, Tokyo.

(END VIDEOTAPE)

LU STOUT: Now Italy's Euro 2012 preparations have been rocked by new developments in match fixing investigation. Pedro Pinto has got all the details. He joins us now live from London -- Pedro.

PEDRO PINTO, CNN SPORTS CORRESPONDENT: Hey Kristie, this is a developing story. Defender Domenico Criscito has been cut from Italy's European championship squad after being implicated in allegations of match fixing. His room at Italy's training camp was raided by police early on Monday morning as part of a national operation aimed at eliminating corruption in Italian football.

Authorities arrested 19 people across the country. Among those taken into custody was Lazio captain Stefano Mauri. He's accused to taking money to influence the outcome of games.

Juventus coach Antonio Conte who just won the Serie A title is being questioned by authorities. They want to find out more information about several matches when he was at Siena in Serie B in the 2010-2011 season.

Monday's operation was part of a wider investigation which has already seen a number of arrests of current and former Italian players. In June last year, the interior ministry set up a special match fixing task force in response to a number of high profile cases. Authorities have found evidence that several players, coaches, and officials have taken money from betting syndicates allegedly based in Eastern Europe and Asia to fix league matches in Italy. And this is a story we will continue to follow throughout the day on CNN as there are more developments.

In the United States, game one of the Western Conference Finals in the NBA saw the Spurs clash with the Thunder in San Antonio. It was a meeting between two teams that have lost only one game combined in the playoffs so far. The Spurs were perfect 8-0 in the postseason heading into the contest. They were in front early on thanks to Manu Ginobili who hit some big shots including that one from downtown in the first quarter.

Oklahoma stayed close. Derrick Fisher scored 13 points off the bench on 6-8 shooting.

As you would expect, OKC's big guns Russell Westbrook and Kevin Durant got their share of points. Durant finished the night with 27.

The Thunder led by nine at the start of the fourth quarter, but the Spurs made a big run. Tony Parker getting the bucket and the foul. He had 18 points. And Ginobili continued his offensive onslaught. 26 off the bench for the Argentine star as the Spurs keep their winning streak going 101-98 the final score on Sunday night.

At the French Open I can tell you that Victoria Azarenka narrowly escaped a huge upset on Monday. The women's world number one was a set and four games down to a little known Italian before finally staging a comeback. The Belarussian was up against Alberta Brianti and dropped the first set 7-6. The top seed then found herself four games down in the second set before finding her rhythm and her range. Azarenka escaping a massive upset emerging victorious in three hardfought sets.

On the men's side of the draw, Roger Federer kicked off his 50th straight grand slam tournament with a 6-2, 7-5, 6-3 routine win over Germany's Tomas Kamke. The 16 time Grand Slam title winner and champion in 2009 next faces either David Nalbandia of Argentina Adrian Ungur of Romania.

Let's wrap up this sports update with a little golf. Luke Donald is again number one in the world rankings after winning this weekend's BMW PGA championship. He finished four strokes clear of Paul Lawrie and Justin Rose. We wanted to show you the best shot of the final round at Wentworth in England. This is Marcel Siem on the second hole, picks an eight iron and I can tell you that's the right choice. His first ever hole-in-one in professional golf.

Donald won the tournament, but it's Siem getting the consolation of an unforgettable ace at Wentworth.

That'll do it for sports for this hour. Kristie, back to you in Hong Kong.

LU STOUT: All right. Pedro, thank you very much indeed for that.

Coming up next here on NEWS STREAM, Facebook just launched its own camera after snapping up Instagram. Is a Facebook smartphone next? Find out if Apple's iPhone could be getting some competition from its own former engineers.

(COMMERCIAL BREAK)

LU STOUT: Welcome back.

Now could Facebook soon release its own phone? Now the New York Times reports that the social network is working on its very own smartphone. And has hired several engineers from Apple who worked on the iPhone. They say it would be Facebook's third attempt to build a phone. But why does Facebook want to build a phone at all?

Well, one employee told the paper that the push comes from founder Mark Zuckerberg. He said this, quote, "Mark is worried if he doesn't create a mobile phone in the near future Facebook will simply become an app on other mobile platforms." And given how many social networks there are on mobile platforms right now he might have a point. From direct competitors like Google+ more focused experiences like the Fitness Network, Photocracy, or the local location service FourSquare right here.

Now even though Facebook hasn't released a phone, there are Facebook phones out there. Now here is a Cloud Touch. It's by the British company INQ. And the entire phone's interface is based around Facebook.

And there's this, it's called the HTC Status which looks normal enough until you notice this. This button right here. And it is a dedicated button for accessing Facebook.

Now time now to zoom in on the world weather. And meteorologist Tom Sater is standing by at the world weather center -- Tom.

TOM SATER, CNN WEATHER CORRESPONDENT: Hello, Kristie, the International Airport there in Hong Kong has reported just over a trace of precipitation in the last 24 hours. In fact, just one millimeter actually. You have surrounded yourselves with some storminess. In fact, if you look at the region, it's quite colorful, a lot of activity and of course the Philippines over toward Cambodia and Thailand, toward Bangladesh. But I do want to point out on the edge of your screen here you can kind of see what's left of Sanvu. Take a look at it, it just kind of runs right off the screen.

I've got a great image, though, to show you to recap if you were not with us on the weekend, a great satellite picture of what was at the time a Typhoon Sanvu. And then right over here, this is where of course we have Iwo Jima. It brushed by the area with pretty strong winds, I mean sustained at 100 kilometers per hour, but we had gusts at 154. No reports of any injuries and just some minor damage.

But really the activity seems to be riding along this little stream of cloud cover. This is the same funnel system that helped take Sanvu off into the cooler waters of the Pacific. It's losing its punch now. In fact, no threat to any land mass. But we're going to watch this kind of meander around some of the provinces here. And we are finding just about every day now some reports of rainfall from 70 to 87 millimeters.

What we're going to find, though, is this front is going to start its transition northward. Here's the latest satellite picture -- now again this is an infrared image, so the colors you see are the higher and colder cloud tops. Notice this bit of energy. This is going to help feed the system to the south. What I mean by that is an area of low pressure is going to develop right along the stationary front where we found continuous activity of convective thunderstorms. And it lifts is northward as this area of low pressure kind of rides along the front.

So what this means that in some provinces a little further to the north that could use some rainfall will most likely get it in the next 24 to 48 hours. Although it seems like almost every day or every other day we've had the pictures and the video of the flash flooding of homes collapsing.

Speaking about going northward, look at South Korea. Watch this explosion of thunderstorms, some light wind damage is possible along with some torrential downpours. It seems to be kind of losing its punch now and raining itself out, but it all is circulating around another area of low pressure that will make its way into Tokyo for rainfall in the next 24 hours and points northward.

But the heat is still on in Beijing, 33 degrees expected on Tuesday. It's actually the same temperature that they have in Manila. Looking forward to that in the forecast anyway.

They are still looking forward to some warmth in areas of Europe. 27 was the high in London. The average is 19. Oslo 26. You actually hit 27. And 28 degrees the last couple of days.

Current temperatures 23 in Berlin, 22 in Warsaw. We're still watching an area of low pressure. It remains off shore. So continue temperatures to be unseasonably warm and good parts of the UK, France, and of course into Spain. Thunderstorms stay at bay a little bit to the south in the southern countries of Europe.

Here's your city by city forecast. And we'll take a quick look at the French Open in a moment.

And after Oslo hit 28 degrees, look at this, this is for Tuesday 18. Northerly winds dropping down, but it continues to bake in some areas. Monday, average high in London, 19 degrees. You're going to be in the low to mid 20s. And in Paris, the clay is going to be baking yet again. Average high temperature in Paris is 19. Take a look at the forecast. We're looking at numbers here for the French Open at 26. There is hope, there could be an isolated thunderstorm. I mean, of course you don't want it if you are there watching the matches, but it could help cool things down.

It's just a hit and miss chance, Kristie, for the most part, but the temperatures will remain unseasonably warm. Of course, round one continues today. I'm going to be watching a lot of folks just kind of wiping their brow at 26. Kind of warm.

LU STOUT: Yeah, a very high of 25 degrees there. Tom Sater thank you very much indeed for that.

Now up next, it was the car for the everyman with a price tag to match. And after 42 years on the road, the Lada Classic is going vintage. We'll tell you why next on NEWS STREAM.

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LU STOUT: Welcome back.

It is the end of an era. The Lada Classic was a product of its time, a car that was made to be affordable and not much else. And now 42 years after it first hit the road the Russian car maker says it will stop making its Classic. So our Phil Black took one out for a spin.

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BLACK: In Moscow today, you can't escape the Soviet Union, the symbols of its power, its traditions and its legacies are everywhere, including on its roads where you'll still find the peak of Soviet car building: the Lada Classic series.

This is actually the second Lada 2107 we had to hire, because the first one broke down.

Classics were exported as the Riva (ph) and they're famous around the world for being cheap, poor quality, and inspiring bad jokes.

Like, what do you call a Lada at the top of a hill? A miracle.

What do you call a Lada driver who says he has a speeding ticket? A liar.

And famously, how do you double the value of a Lada? You fill the tank.

For 42 years Russian state car maker AutoVAZ has been turning out Ladas that look just like the 1966 Fiat 124 they're based on. When CNN visited this plant 15 years ago, it's managers admitted the cars were already long out of date. They continued to sell largely because of the price as little as $4,000. And drivers had almost no choice. But as the Russian market flooded with international brands sales dropped. So Lada is now finally killing off the Classic.

One highly opinionated British motoring journalist has declared this is the worst car in the world. It is certainly a unique driving experience. Despite poor ratings in safety, comfort, quality, speed, the Lada Classic Series continues to enjoy a very special place in the hearts of many Russians.

Vassili Babashka (ph) and his friends are restoring Ladas they inherited from their grandfathers, a much loved feature of the classics is their simplicity. They're cheap and easy to repair with the skills handed down between generations.

"This was the era of the Soviet Union," Vassili (ph) says. "The time when we were always first, the time of our grandfathers. It must be remembered."

Lada Classics were once a status symbol, but this is now a country where you can see a Lada parked next to a Masserati, Bentley, and Ferrari.

Igor Morzharetto is editor of Russia's Behind the Wheel Magazine.

"In 1970 it was a delight for the Soviet people," he tells me. "It fit all European requirements. It was comfortable with a large trunk. For its time, it was a beautiful car. But its time has passed."

Lada and its international partners Nissan and Renault are now focusing on producing modern affordable cars. And they're hoping to maintain a large slice of the Russian market which is predicted to become Europe's biggest within a few years. But the Classics won't disappear quickly. There are millions of them on Russias roads. And like other Soviet hangovers, they've shown they can last.

Phil Black, CNN, Moscow.

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LU STOUT: And if there is one man with a whole lot of love for the Lada it is Russian president Vladimir Putin. But the vehicle has not always loved him back.

In May of 2011, Mr. Putin test drove a new Lada model, but it took several attempts to start the engine. Mr. Putin is particularly fond of the yellow Lada. In 2010 he drove with a convoy of them across Siberia at least one broke down during the trip.

And that is NEWS STREAM, but the news continues at CNN. "WORLD BUSINESS TODAY" is next.

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