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ANDERSON COOPER 360 DEGREES
Romney Ads Misleading?; President Obama Fails to Meet With World Leaders
Aired September 25, 2012 - 22:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ANDERSON COOPER, CNN ANCHOR: Good evening, everyone. It's 10:00 here on the East Coast.
And we begin tonight "Keeping Them Honest" on a campaign distortion that won't seem to die, the false claim that President Obama is trying to take the work requirement out of welfare.
In fact, Mitt Romney breathed new life into it just a few hours ago right here on CNN.
The other day, on "60 Minutes," President Obama said that some of his campaign ads -- quote -- "go overboard."
Well, today in Ohio, CNN's Jim Acosta asked Mitt Romney if he was willing to make a similar admission.
Here's an extended portion of that interview.
(BEGIN VIDEO CLIP)
JIM ACOSTA, CNN CORRESPONDENT: Just the other day, you said the president has been trying to fool people with his ads and his speeches about your record.
But fact checkers have also taken issue with your ads.
Haven't you also played fast and loose with the facts from time to time?
MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: We've been absolutely spot on. And any time there's anything that's been amiss, we correct it or remove it.
The president, on the other hand...
ACOSTA: Even the welfare ad?
Look, it has been shown time and again that the president's effort to take work requirement out of welfare is a calculated move, the same thing he did with regards to food stamps. He took work out of welfare in the -- excuse me -- work out of the food stamps requirement.
And what was the result?
The study shows that twice as many people went from having food stamps to those that are able-bodied to from as a result of that change.
ACOSTA: But if PolitiFact calls it Pants on Fire and "The Washington Post" gives it four Pinocchios, they're wrong? Is that what you're saying?
ROMNEY: There are there are -- you look at the facts.
Did he take the work requirement out of welfare?
ACOSTA: I think what the what the Obama administration has said is that, no, they're trying to give governors the flexibility to increase the amount of work that goes into receiving welfare benefits. You're -- you're saying...
ACOSTA: you don't buy that?
ROMNEY: No, no.
You always have the capacity to add work. There's never been a requirement that you can't have more work. The requirement that they're waiving was saying that people don't have to work to get -- to get welfare. That's the change that they've proposed.
I disagree with that direction. I think the president is also -- I disagree with the direction on the work requirement as it related to food stamps. Look, taking work requirements out of government assistance is, in my opinion, a very a very bad course to take and creates a culture of dependency.
We help people who need help. We want to help people that need help. But the idea of removing work requirements, I think, is a mistake.
(END VIDEO CLIP)
COOPER: Well, "Keeping Them Honest," as you just heard, Jim Acosta there say, PolitiFact gave that claim a rating a Pants on Fire. "The Washington Post" gave it four Pinocchios.
And FactCheck.org said this -- quote -- "A Mitt Romney TV ad claims the Obama administration has adopted a plan to gut welfare reform by dropping work requirements. The plan does neither of those things."
And back to the claim Governor Romney made about correcting ads or statements if there's anything factually wrong or amiss, as he said, Jim Acosta called and e-mailed the Romney campaign to ask if they could give any examples of that happening. So far, he's gotten no response.
Jim Acosta joins me now. So does Lori Robertson, managing editor of FactCheck.org.
Jim, you pressed Governor Romney specifically on that welfare ad which as we wildfires independent fact-checkers have said was false. He didn't back down. Not only did he not back down. He seemed to double down on it.
JIM ACOSTA, CNN CORRESPONDENT: That's right.
He did not back away from that statement at all and as a matter of fact, this is a pretty steady and constant claim that he makes out on the campaign trail. He talks about it at his campaign rallies. He talks about it in interviews. And so that's why we asked him about it, because it struck us on the campaign plane the other day when he first made this charge that the president has been trying to "fool people" with the president's speeches and with the president's ads about the Romney record.
We thought it would be appropriate to go back to him and say hey, wait a minute. Haven't some of your ads been called into question by these fact checkers? And, as you said, he just went on to say in that interview that when ads were found to need corrections or be removed, that that's what the campaign did.
But we went back, we haven't found any cases like that. We have asked -- I have asked three separate Romney campaign officials to get back to me with some kind of citation or example. They just haven't done that at this point.
COOPER: Lori, your organization analyzed that ad, the -- Romney's welfare ad. The ad makes two points, that President Obama guts welfare and that he drops the work requirements in order to receive welfare. Neither of those claims is true, correct?
LORI ROBERTSON, MANAGING EDITOR, FACTCHECK.ORG: Yes. That's correct. They're not true.
Instead, what the Obama administration policy calls for is a waiver program where states can apply for a waiver from work requirement rules, but, in exchange, they have to come up with some kind of plan to more efficiently promote work.
What we found is that only 29 percent of people receiving cash assistance were meeting that work requirement when Obama took office.
COOPER: You even talked to a former congressional aide who was instrumental in crafting that legislation and he told you it was misleading.
ROBERTSON: Yes. Yes.
He said he didn't agree with the Obama administration changing the rules on the work requirement, but he said that the ads claim that this was gutting welfare reform was very misleading. COOPER: Do you recall, Jim, any example -- I know the campaign hasn't gotten back to you, but do you -- you have been with the campaign now -- do you recall any example of a correction that they have made or taken down an ad?
ACOSTA: I don't.
And, you know, keep in mind the very first ad that came from the Romney campaign during this campaign cycle was an ad that took President Obama out of context. You will recall this was an ad that used a clip of Obama back in the '08 campaign talking about John McCain and what John McCain had to say about the economy, but in the context of that Romney ad, it only presented the words as if they were coming right out of the president's mouth, and that wasn't the case.
I have tried to go back to the Romney campaign and say, well, was this the ad that you corrected or removed? They just haven't gotten back to me on that. But, Anderson, I mean, the reason why this is so important and crucial to the Romney campaign, this line of attack on welfare and on welfare reform, what they accuse the president of doing with welfare reform, is it fits into a narrative that they have been trying to say about the president for weeks now.
And that is that the president encourages government dependency, that he would rather see people who are dependent on government than go back into the work force, and you heard Mitt Romney talk about that in the interview today, that he wants to get more people back to work instead of being dependent on government, and so that is why you did not see him back away from that claim today, Anderson.
COOPER: Lori, do you recall the Romney campaign removing or correcting any ads or, frankly, the Obama campaign, for that matter?
ROBERTSON: I don't. I don't recall either campaign removing or correcting ads.
And, you know, I don't think this campaign is any different than other campaigns. There is very rare instance of a campaign or even a third-party group taking an ad down or issuing a corrected version of it.
COOPER: Yes. I did an interview with Debbie Wasserman Schultz, and they had put out an ad -- I think it was the DNC or a super PAC, I can't remember -- I think maybe the DNC, but it wasn't an Obama campaign ad.
But she had misquoted "The L.A. Times" and made it sound like they were confirming something which was not what the article said. They didn't retract that ad, to my knowledge.
We will continue to look for that.
Lori Robertson, appreciate it. Jim Acosta, thanks. Let us know if you hear anything tomorrow from the Romney campaign.
Let us know what you think on Twitter. I'm tweeting tonight -- @AndersonCooper is the address.
Also, President Obama's decision to speak and run, addressing the United Nations today in New York without actually formally sitting down and talking one-on-one to any of the key members of the United Nations, no other world leaders. Yet he did sit down with the folks on "The View." Was that a mistake? What's behind the president's decision there?
And with so much turmoil in the world, is it a good idea to give big international players the cold shoulder? We will talk to David Gergen and Fareed Zakaria about that next.
COOPER: President Obama addressed the U.N. General Assembly today. He had a tough message for Iran.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: And that's why the United States will do what we must to prevent Iran from obtaining a nuclear weapon.
(END VIDEO CLIP)
COOPER: He also had a clear message for the Muslim world when it comes to insults against Islam and freedom of speech. Get a thicker skin.
(BEGIN VIDEO CLIP)
OBAMA: As president of our country, and commander in chief of our military, I accept that people are going to call me awful things every day. And I will always defend their right to do so.
(END VIDEO CLIP)
COOPER: Well, clearly, the president felt he had important things to say.
Now, you would think that he would be eager to expand on them one-on-one with some of the key players, some other world leaders face-to-face. This is, after all, an explosive moment on the international scene. This week, nearly anyone who's anyone happens to be here in New York.
"Keeping Them Honest" though President Obama took off from New York today having held precisely zero formal face-to-face meetings with anyone, none, with the exception of a quick word with the president of Yemen, who was meeting with Deputy National Security Adviser John Brennan. He also skipped the traditional luncheon today, leaving the U.N. secretary-general sounding kind of like a jilted prom date.
(BEGIN VIDEO CLIP)
BAN KI-MOON, UNITED NATIONS SECRETARY-GENERAL: I think he must be busy with something at this moment.
KI-MOON: Or perhaps he must be stuck somewhere in traffic.
(END VIDEO CLIP)
COOPER: Well, the secretary-general may be having a hard time explaining it because the notion of a president doing this kind of a speak and run is pretty unprecedented.
Here's what President Obama's New York scrapbook looked like last year. He met with Britain's prime minister, David Cameron. He had a sit-down with French President Nicolas Sarkozy. Mr. Obama also spoke one-on-one with Israeli Prime Minister Netanyahu.
He met with all those world leaders, all these world leaders as well, 13 in all. Similarly, there was plenty of meetings the year before and the year before that. In fact, "Keeping Them Honest," we checked and discovered that no president in recent memory has ever come up for the General Assembly and not met with anyone.
Yesterday, White House spokesman Jay Carney said Mr. Obama has had over the last few weeks -- quote -- "extensive consultations" -- unquote -- with leaders, especially in the Arab world.
(BEGIN VIDEO CLIP)
JAY CARNEY, WHITE HOUSE PRESS SECRETARY: The president has obviously got a busy schedule. He has a busy schedule all the time. You know, it is a fact that he has in recent weeks been intensively engaged in matters of foreign affairs, and that's part of being president.
(END VIDEO CLIP)
COOPER: Republicans have latched on to this scheduling comment saying Mr. Obama has had time to tape an interview yesterday with the women of "The View," but not talk with world leaders, especially Benjamin Netanyahu, who arrives tomorrow in New York.
"Keeping Them Honest," we checked and the official White House schedule shows a campaign appearance tomorrow and nothing else all week.
Joining us now, senior political analyst David Gergen and Fareed Zakaria, host of "FAREED ZAKARIA GPS" Sundays on CNN.
David, you could see this coming a mile away. The president has time for "The View" but not for bilateral meetings with world leaders. Why would the White House just open itself up to this kind of criticism so close to an election, especially considering all that's happening in the Middle East -- North Africa and the Middle East? DAVID GERGEN, CNN SENIOR POLITICAL ANALYST: Anderson, it's almost inexplicable, except this White House has been focused on this campaign for a long time and it's paying off at the polls, but it's not paying off in terms of foreign policy.
COOPER: But just the optics of that, do you think it has the potential of hurting the campaign?
GERGEN: I doubt it.
It's going to clearly come up in the foreign policy debate, but I think it's more a mistake in terms of foreign policy. At a time like this, as you say, with so much turmoil in the Middle East, to refuse to meet Middle Eastern leaders, the president of Egypt wanted a meeting, Prime Minister Netanyahu of Israel.
As you well know, as Fareed knows better than I do, in diplomacy, personal relationships are very, very important. It's especially true in the Middle East, where people want to look you in the eye, take your measure, and decide what kind of relationship they're going to have with you.
So I think simply in terms of what's going on in the Middle East, but it's also true, Anderson, that I think in terms of his presidency, you know, taxpayers want a full-time president. They want somebody who's looking after them at times of trouble. And, yes, of course people expect him to campaign, but not at the expense of potential relationships in the Middle East.
COOPER: Fareed, the White House spokesman said look, in the last couple weeks, I want to get the quote right, he said the president just in the last couple weeks has had intensive consultations with leaders in the region, the leaders of Turkey, of Egypt, Israel, of Yemen, of Libya and of Afghanistan.
FAREED ZAKARIA, CNN WORLD AFFAIRS ANALYST: No, it's not enough. I think David is right here.
Look, the reality is personal chemistry is very important. Also, remember most of these leaders, you are speaking through an interpreter. And as you well know, Anderson, when you're doing it on the phone, you have an interpreter there. You're doubly or even triply removed from the person.
When you meet them in the flesh, even though there are interpreters, it's a much more human interaction. And, look, he's never met the president of Egypt. This is a guy we really need to understand, whether he can bring Egypt to a Democratic place and a pro-Western place while retaining his Islamist background.
There are issues with Turkey. They have got many important issues to deal with. I don't quite understand why this happened. Possibly, there's some explanation. One part of it may be that this president is very smart. He's very cerebral. He tends not to place a lot of weight on what David was talking about, the person-to-person meetings, the schmoozing.
COOPER: We saw that in his relationship with Capitol Hill. He doesn't like the back-slapping.
ZAKARIA: Precisely. So there may be some part of him that says these meetings are kind of formal, they're choreographed, we don't actually have any business to do, I'm getting the business done on the side.
Maybe there's some element of that, because, otherwise, it is, as David says, inexplicable.
COOPER: It is interesting, David, just how -- and you have more experience at this than a lot of folks, having worked in White Houses, how the personal relationship matters at that level with the world leader.
GERGEN: They matter enormously.
One of the models that President Obama has is President George H.W. Bush, President Bush Sr. And his Rolodex and his friendships made an enormous difference in the quality of his presidency on foreign policy.
You know, when Saddam went into Kuwait and the United States was able to round up all those friends, a lot of that had to do with the personal relationships that George Bush senior had established over time, and people give you the benefit of the doubt when there's skepticism. Look at the distrust that exists between Netanyahu and President Obama on that very issue alone.
We could have a conflict with Iran that sort of comes through just the two people not having a very good personal relationship and maybe misreading each other. And I think these things are very, very important in international diplomacy, especially in the Middle East.
COOPER: Critics of Governor Romney say, well, look, he's done his share of light interviews, but it's a different -- I mean, the standard for somebody campaigning who is not in public office and somebody who is the president of the United States is very different.
ZAKARIA: It's very different. Look, you get the benefits. One thing that people forget is when you have a foreign crisis, when you have foreign issues, the president has an enormous benefit against his challenger because he gets to be presidential.
When the president gives a speech about the Arab -- what's going on in the Arab world, he gets to do it with the backdrop of the United Nations General Assembly. If Mitt Romney does it, he's going to have to find, you know, the American Enterprise Institute as his backdrop.
So there are enormous benefits. There is a price, which is you do have to go through sometimes tedious meetings. The thing about these meetings is, five of them will be tedious, but one will pay off, but you don't know which one will pay off.
I think that fundamentally they seem to have decided that they are in full campaign mode at a point when they really should not be, both for foreign policy reasons, but also because, as David says, this is -- you know, this is meant to be a full-time, 24/7 job.
COOPER: Fareed, thanks very much.
David Gergen, thank you as well.
Talking about the campaign, there is new polling tonight in four crucial swing states. Together, they count for 59 electoral votes. You will see whether President Obama or Romney has the edge now in those swing states when we continue with "Raw Politics" ahead.
COOPER: Hey. Welcome back.
Let's talk about "Raw Politics" for a moment. With Election Day six weeks away, several new polls show President Obama leading in four crucial swing states. Now, the new polling was done after the release of Mitt Romney's secretly recorded remarks to a group of wealthy donors back in May.
Romney told them as you know that 47 percent of Americans are dependent on government, see themselves as victims and will vote for President Obama no matter what. He said it wasn't his job to worry about them. He says he didn't say it very elegantly.
But as you saw at the top, Mr. Romney doubled down today with CNN's Jim Acosta on that now debunked ad claiming that President Obama is taking the work requirement out of welfare. In addition, as we said, there's new polling out tonight with a special focus on the economy.
I talked about it earlier with chief national correspondent John King and chief political analyst Gloria Borger.
COOPER: So, John, new polling out today from "The Washington Post" focuses on two of the most critical states in the election cycle, obviously Ohio and Florida. What do they show?
JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: They show bad news for Governor Romney heading into the big week at the first debate.
Ohio, without a doubt a must-win state for Governor Romney, here's the new "Washington Post" poll. You see the numbers right here, the president above 50, a six-point lead in the state of Ohio. That's one poll. But if you put together what we call a poll of polls, looking at now a half-dozen polls conducted over the past two weeks, look what you get, a six-point lead for the president of the United States in, again, a must-win state for Mitt Romney. That is the state of Ohio. Another must-win -- I can give you a mathematical scenario for Romney to win without Florida, but it's very difficult. So what about Florida? Two new polls out today, one is an ARG poll shows the president with a five-point lead. Here's the "Washington Post" poll you just mentioned, and it shows the president with a four-point lead. Again, what we like to do when you have a lot of polls is add them all up and average them out.
This is more than a half-dozen polls conducted over the last two weeks. What do you get? A four-point lead for the president in the state of Florida when you average it out. There are other battleground polls as well, but let's just focus on those two states because when you come to the electoral map, the president's at 237 right now. Those are the blue states strong or leaning President Obama's way. Anderson, if the president were to win Ohio and win Florida -- and the polls show him leading right now -- game over. There's nothing else he has to do if the map doesn't change.
COOPER: It's amazing how it boils down to that.
Gloria, the president holds very strong numbers on the economy, interestingly enough, in these states. In particular, he polls high on the question who better understands the financial problems that people are facing, and that's despite the fact that those polls feel the country's on the wrong track.
What does that say to you?
GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Well, it says what the president has done is he's connected with people to let them know he's on their side.
That's a key thing to do in a presidential race. Does this president understand my economic problems? Even though they believe that the country is headed on the wrong track, those numbers are high, but they're not as high as they were, say, six months ago.
And what this also says to me is that they bought the Bill Clinton argument from the convention, which is essentially give this guy a little bit more time and if you do, he will get it right.
COOPER: As you look at the numbers, John, and you take into account some of the most recent polling out of Virginia, which is another big swing state, crucial swing state, where President Obama's ahead, what does it mean for Governor Romney? Does it mean that the debates are basically make-or-break?
KING: Yes. In a word, yes, because Anderson, if you were just down in -- just say it was just Ohio and Florida. You could dedicate more campaign time, send Governor Romney, send Paul Ryan, send more TV ad money, you could send them into those two states, right? You could try to essentially carpet-bomb those two states.
But as you noted, polling also shows him down in Virginia. Polling also shows him brand-new today down in Iowa, shows him down in Nevada, shows him down in Wisconsin. It's a dead heat in Colorado and a dead heat in New Hampshire.
When you have all this ground to cover, you don't have the time and the resources. Six weeks is a lot of time, but you can't change so many different states. What does he need? A national shift in the dynamic, especially on that question you just mentioned to Gloria, who would best handle the economy. If Governor Romney can't change that, especially in that big first debate, he's in trouble.
COOPER: It's interesting, though, Gloria. There's a lot of talk of Obama's approval ratings, how nine of 13 national polls conducted this month have shown him cracking 50 percent approval. How important of an indicator is that? Why is that so important?
BORGER: It's a huge deal for him, because history shows us, modern history shows us that when you're running for reelection, unless you're at that 50 percent mark, you're not going to win.
George W. Bush, back in 2004, was at kind of 48 percent in October, but then by the time the election came around, he was, you know, at 52 percent, 53 percent. So he kind of passed that threshold.
So it's very important because, again, if people approve of you, they're going to give you the benefit of the doubt, even if they believe that things are not headed in the right direction yet. It means that they have a certain sense of optimism about what you can do for them in the future, and that's so important for President Obama right now, because Mitt Romney is making the case that the president cannot fix the economy, that he's the only one who can do that. And the public at least for now seems to be saying you know what, that may not be true. We're going to give him another shot at it.
COOPER: John, did all this stuff happen really in the wake of the convention? It seems like, and maybe I'm wrong, but that the convention kind of changed the narrative or the mood or something. Did it?
KING: There's no question that the Democrats, meaning the president, got much more out of his convention than Governor Romney and the Republicans got out of theirs.
Part of that is by the nature of going last. It always helps to be the second convention. Part of that is even Republicans will concede privately the Democrats had a more organized, more consistent message. They had better speakers.
Michelle Obama, Bill Clinton, and President Obama did a better job frankly in making their case, selling their case to the American people.
And, Anderson, one other thing, though. That 47 percent remark Governor Romney made at that fund-raiser back in May that was released to "Mother Jones" just last week, that's breaking through. I was in Michigan last week. When you travel the country and you talk to people, if you talk to pollsters, they say it has hurt Governor Romney again on that fundamental question, who would best handle the economy and who represents your values. That has hurt. COOPER: Gloria, thank you. John King, thanks.
KING: Thank you.
COOPER: We got breaking news ahead on the program.
For months now, we have been reporting on charities that take your money and then don't deliver on their promises. Tonight, the single largest fund-raising company in the world, Quadriga Art, will now have to answer questions from the U.S. Senate about their financials -- the latest coming up.
COOPER: Unbelievable crash caught on tape. Incredibly the driver of this truck survived being ejected out of the windshield. There you see he basically walks away. We'll have that and more when we continue.
COOPER: Welcome back. Another Keeping Them Honest report tonight with breaking news that really matters to anyone who donates to charity and expects the money to go to those who need it most.
We have big new developments tonight concerning an outfit called Quadriga Art, which is the single largest fund-raising company in the world. It's already under investigation by Eric Schneiderman, the New York attorney general, and Kamala Harris, the attorney general of California.
Now, for months, if you've been watching our show, we've been trying to get answers from Quadriga, but so far, no one from the company has agreed to appear on camera. Now, Drew Griffin has asked repeatedly. Take a look.
(BEGIN VIDEO CLIP)
DREW GRIFFIN, CNN CORRESPONDENT: I understand that. But what I want to know is am I going to get an on-camera interview? All right. OK. So the bottom line is you're not going to give me an interview.
It's Drew Griffin, G-R-I-F-F-I-N.
UNIDENTIFIED FEMALE: He is not here.
GRIFFIN: Oh, I'm trying to reach Mr. Schulhof. Oh, he's not in.
(END VIDEO CLIP)
COOPER: Well, Quadriga calls our reporting biased. They say we've ignored the good they're doing for their clients. But they still won't go on camera.
They might not want to talk to us, but now they are going to have to talk to members of the United States Senate. Drew Griffin has been on the story from the get-go. Drew, what are we learning?
GRIFFIN: Anderson, this is all about a pretty upset chairman of the Senate Finance Committee, Senator Max Baucus, who doesn't like money being donated, specifically for injured and disabled veterans, going instead to a private fund-raising company.
He and his committee have sent a letter now to Quadriga Art's chief executive officer, the guy I was trying to reach by phone, asking for detailed financial information about the relationship between Quadriga Art, the private fund-raiser, and the Disabled Veterans National Foundation, that charity we reported on that's taken in $70 million and given almost all of the money to Quadriga Art.
Quadriga Art says, despite all that money, the company has made no net profit off the charity. Well, the Senate now wants to see specifics, asking for Quadriga's records for the past three years in dealing with the DVNF, including goods and services provided to the DVNF, accounting of all invoices; financial statements, including income statement, balance sheet and statement of cash flows.
Quadriga Art reacted to this news by sending CNN a statement saying it's voluntarily been sending information to the Senate since the summer, and have made clear, they say, "that we are happy to answer any additional questions they may have which will help us clarify what we do and how we do it."
Well, what we're about to report tonight, Anderson, could have Quadriga Art answering a lot more questions. Internal documents obtained by CNN show at least 11 charities, including the DVNF, have found themselves upside-down, in debt millions of dollars to Quadriga Art, all the donations gone to pay the fund-raiser, not going to the purposes you may have donated to.
GRIFFIN (voice-over): If you drive too fast, looking the other way, as you speed along Interstate 40 in western New Mexico, you might miss it. But this is the town locals pronounce "Through." Underneath its water tank is the St. Bonaventure Indian School and Mission, affiliated with the Catholic Church, where 200 low-income Navajo children receive free education, subsidized family housing, and in outlying areas the mission even provides water and other life- sustaining services.
The mission mostly survives on donations, promising to use those donations wisely, which is why what happened here between a Native American mission and a major New York fund-raising firm is raising questions.
(on camera) Four years ago, Quadriga Art began a fund-raising campaign on behalf of Indian children. According to internal documents, Quadriga has raised more than $9 million, and according to those same records, almost none of the money, if any, has come back here to the mission.
(voice-over) In fact, Quadriga charged so much for its services, the school and mission went into debt more than $5 million.
Jay Mason is the attorney for the Catholic diocese of Gallup, New Mexico, which only learned of the disastrous fund-raising campaign after CNN contacted him with details.
(on camera) What does the diocese conclude about a company, a major fund-raising company that would somehow introduce itself into St. Bonaventure charity mission school and within four years, from scratch, allow that entity to be $5 million in debt?
JAY MASON, ATTORNEY FOR CATHOLIC DIOCESE OF GALLUP, NEW MEXICO: Well, I mean, it's not appropriate, and since the diocese, as I mentioned earlier, just found out about it last week, we have serious concerns about that company.
GRIFFIN (voice-over): In a statement e-mailed to CNN a Quadriga spokesman conceded the direct mail campaign for the school was a failure. "Sometimes the program is successful and sometimes it results in a net loss for Quadriga Art," the statement reads.
The statement also includes this: "We are proud of our ability to take on start-up organizations that do not have an e-mail list, donor file or the money on hand that it takes to build a long-term revenue- producing direct mail program."
As for the mission itself, the executive director and its board members refused to be interviewed. Once we began asking questions, we got an e-mail from the mission about the $5 million debt still owed. As you will see, the e-mail reflects a pattern. CNN begins asking questions, the fund-raiser forgives the debt, and the charity says glowing things about Quadriga Art.
"As had been agreed," the e-mail says, "the mission now owes Quadriga Brickmill nothing for this pilot project," going on to praise Quadriga Art, to say, "As a past provider of printed material, Quadriga has helped enable the mission to deliver water and food services and keep its school open during lean economic times by allowing the mission to delay repayment of part of its bills on generous, no-interest payment terms."
There is no mention of the $9 million people donated that did not go to this charity.
In Los Angeles, Help the Children is a charity that says it feeds 130,000 hungry families each month out of this warehouse in south L.A. Roger Presgrove runs it. He told us he was astonished by Quadriga Art's actions and, despite recovering from a medical procedure, was eager to tell us about the failed fund-raising campaign Quadriga Art sold him in 2010.
ROGER PRESGROVE, HELP THE CHILDREN: They said the first year is kind of like we're going to break even, you know; we're going to do a little mailing, see how it goes. By the third year we should be making a lot of money.
GRIFFIN (on camera): Did that happen? PRESGROVE: I didn't wait until the third year. When we found out we kept getting more and more in debt, I pulled the plug. I tried to get out of it. We signed up with them in 2010. 2011, we tried to get out. They said, "No, we can't let you out because you're upside- down. You owe us $285,000." So we had to get our money back.
GRIFFIN (voice-over): Quadriga raised more than $800,000. The charity was given less than 5 percent.
(on camera) That's it?
PRESGROVE: So we had to take money out of our reserves to keep our programs going to fulfill what we said we would do. And during the meantime, we're the one that's struggling, and they're the ones doing extremely well.
GRIFFIN: Did they rip you off?
PRESGROVE: Oh, yes.
GRIFFIN (voice-over): Internal financial statements obtained by CNN and confirmed by the charities themselves show this past January, 11 charities were millions of dollars in debt to Quadriga Art or its affiliates, and in each case, the charities received little, if anything.
Roger Craver is a national expert on nonprofit fund-raising.
ROGER CRAVER, EXPERT ON NONPROFIT FUND-RAISING: If the charity is promising to do something with the money a donor sends, and there's no money going to it, which is what you said, Drew, if no money has gone to the charitable purpose, then that's fraudulent.
GRIFFIN: Craver says Quadriga Art justifies that kind of operation by actually financing the up-front fund-raising costs. Roger Presgrove with Help the Children admits he was lured in by Quadriga's promise.
(on camera) So it was very attractive?
PRESGROVE: Very attractive. Exactly. When they said, "No, you don't have to have that up-front money, we'll take care of it," I said, "OK. That helps us." But never developed. Nothing ever happened.
GRIFFIN: Do you think they knew from the get-go?
PRESGROVE: I think so. I think they have known from the very beginning.
GRIFFIN: But there's something you should know about Presgrove's dealings with CNN and Quadriga. Presgrove admits he told Quadriga, unless he was let out of his contract, he would go to CNN with his story. Within an hour of making that threat, a Quadriga executive agreed, "I think it's in everyone's best interest to end this and move on," the executive wrote. But Presgrove talked anyway. (END VIDEOTAPE)
GRIFFIN: Anderson, you will not believe what happened next. You just saw Roger Presgrove say he believes Quadriga ripped off his charity. You might have noticed he was wearing a bandage from the medical procedure on his neck.
Well, shortly after that interview, we received a call, a phone call from Quadriga's P.R. person, a woman named Melissa Schwartz, telling us that Presgrove was in no condition to give that interview, since he was on drugs from his surgery, and claimed that CNN had actually dragged him into the interview out of that hospital.
Presgrove himself then wrote to us, asking that we not air the interview you just saw. Here's what he said, in a text, "I have to get out of this contract, and that was the deal. No interview, and I'm out."
GRIFFIN: He went on to tell us in an e-mail that he's retracted all his statements to us.
COOPER: This is unbelievable. I mean, this is incredible.
Drew, you've been reporting on this for years now. We've been doing these reports for months. And each time, I think it cannot get any more stunning. I'm blown away by what you just said. Did Presgrove appear impaired in any way to you?
GRIFFIN: Anderson, in no way. This man was talking to us days before this event. He knew he was having this medical procedure. We actually changed our travel plans so that he could participate in this interview. He had an assistant that could have done the interview. She told us exactly what he said. In fact, he told us the same thing that he said on camera three days before. So there was no way.
And in fact, we're going to put the entire interview that we did with him on your blog, AC 360 blog. You can judge for yourself. He's talking about dates ten years ago. He talked about remembering me when I used to work in Los Angeles a long time ago. He certainly had all his faculties together.
COOPER: You know, we've got to keep on this. Because I mean, if people knew that the money they're giving to charities is going to some fund-raiser and that these charities end up in debt for years, I mean, it's incredible to me. You're blowing this thing wide open, Drew. I appreciate it. We're going to continue on it.
We also have new information tonight about the children caught in the cross-fire in Syria. Plus a rare look on the front lines of the fight. ITN's Bill Neely with the Syrian army next.
COOPER: A new report by the aid group Save the Children describes Syrian kids reeling from trauma after witnessing the horrors of war for more than 18 months.
Now, in the report, children talk about seeing family members killed in all manner of horrific ways. They describe seeing other kids slaughtered and used as human shields. The report is called "Untold Atrocities."
ITN's Bill Neely got a rare look at the front lines in Homs. He was with the Syrian army. Here's what he saw.
BILL NEELY, ITN CORRESPONDENT (voice-over): He is ready to kill. A Syrian army sniper aims through a crack in the wall. This is the hidden front line.
From their firing point, they target rebel positions just 50 yards away. Every day, men die here. This is Homs, the heart of the war, and here it is stalemate.
The streets here are so deadly, we moved through holes in walls and houses, up to near darkness and another sniper. He waits in total silence.
It's never quiet for long. These Syrian troops are trying to take back whole districts the rebels have held for months. They are edgy. The rebels killed five of their men just hours earlier.
So in Homs, they run for their lives, and we do, too. They've been doing it for longer than they ever expected.
(on camera) Why is the war lasting so long?
UNIDENTIFIED MALE: It will continue months, today, one year, we don't know. We don't know.
I'm ready to die. And also this soldier, ready to die for Syria.
NEELY: One and a half years after it began, and the battle for this city and for Syria grinds on relentlessly. The bombardment of Homs, the war here, is as intense as ever.
These soldiers say they have the rebels trapped in this area and that the battle will be over soon.
(voice-over) Whole neighborhoods here are a wasteland with the signs of battle on every building. Few civilians remain. It's almost a shock to see them.
(on camera) In your heart, when you see your area like this...
SALEH SHATTOUR, HOMS RESIDENT: Well, I have no heart at all. Cannot imagine. I feel very sorry for what has happened, really.
NEELY: How long will this go on for here?
SHATTOUR: I don't know. God only knows. God alone knows. NEELY (voice-over): the war here is almost macabre. Bizarrely, a mannequin marks the deadliest junction. But few places here are safe for anyone.
So as world leaders at the United Nations begin to talk again of Syria, deadlocked in disagreement, the snipers on both sides take their positions. Death on their minds. Victory in their sights.
Bill Neely, ITV News, Homs.
COOPER: A look at inside Homs.
Let's get caught up on other stories we're following tonight. Isha is here with a "360 Bulletin" -- Isha.
ISHA SESAY, HLN ANCHOR: Anderson, a man arrested in connection with the stabbing death of an American couple on the island of St. Maarten will appear in court tomorrow. The bodies of Michael and Thelma King were released to family members today. No charges had been filed yet, and authorities say they're not certain of a motive in the murders.
The so-called soccer mom madam pleaded guilty in New York today for one count of prostitution and will get five years' probation. Anna Gristina was arrested in February, accused of running a high- priced escort service in Manhattan.
And an accident caught on tape in Russia. Two trucks collide. According to reports, amazingly, the driver of the smaller truck survived with no injuries after being thrown out of the front window. No word on the condition of the other driver, Anderson.
COOPER: Isha, thanks very much. Amazing.
Coming up, who knew there was a -- apparently, was a new way to get drunk, and it's pretty horrifying. "The RidicuList" is next.
COOPER: Time now for the "RidicuList." And tonight, I've got to say that we thought we heard it all on the "RidicuList" but oh, how wrong we are. Yes, I'm speaking as myself as a "we" for some reason.
Today we learned about the concept of alcohol enemas, also apparently called by the kids butt chugging. I'm not kidding. Thank you. I really, really wish I was.
A fraternity at the University of Tennessee has been suspended while an alleged incident that took place over the weekend is investigated. Dare I say probed? Police say, and I quote, "Upon extensive questioning, it is believed that members of the fraternity were using rubber tubing inserted into" -- you can guess where -- "as a conduit for alcohol, as the abundance of capillaries and blood vessels present greatly heightens the level and speed of the alcohol entering the bloodstream as it bypasses the filtering by the liver."
These kids today. Why can't they just drink a box of wine like normal people? Oh, yes, did I mention they reportedly were doing this chugging boxed wine? Yes. Somehow that makes it even worse. I don't even know why.
Apparently, one of the fraternity members got so drunk off his butt that he had to go to the hospital. He has since been released.
Here's what happened when a local news reporter tried to get to the bottom of what went on in that house.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: When we arrived here at the fraternity house, several college students were sitting outside. We asked them if they would like to comment. One student shook his head no and then they all walked inside.
(END VIDEO CLIP)
COOPER: They were sitting? Hm. Those cheeky kids just walked away. I guess they didn't feel like talking about it, although I can't imagine why. Why wouldn't you want this on your record?
Some other students on campus summed up the situation pretty well, though, I thought.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: My reaction is so strong right now, that is completely out of the blue. I personally have never heard anything like that.
UNIDENTIFIED MALE: Heard of it, I guess, before but, you know, never practiced it.
(END VIDEO CLIP)
COOPER: Well, believe it or not, this actually is not the first time we have featured butt-centric fraternity hijinks on the "RidicuList." A few months ago, you may remember, someone at a college in West Virginia sued his fraternity after he fell off a deck. What caused the fall, you ask? Naturally, he became startled when his fraternity brother shot a bottle rocket -- yes, you guessed it.
There's no video of this incident itself, which I think pretty much makes it the only time someone has fired a bottle rocket out of that particular area and did not post it on YouTube.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE (singing): Rocket butts, rocket butts, people shooting rockets out of their butts. Rocket butts, rocket butts.
(END VIDEO CLIP) COOPER: There are many, many, many more of those videos but we don't want to glorify something that's so quintessentially asinine. Yes.
I've said it before. I'll say it again. Listen up, youth of America. Come closer, if you can. Come closer. Can you zoom in a little bit? Come closer, youth of America. Rear-fired rockets do not make you cool. And if you think chugging wine from your posterior will solve all your problems, please, please, think again.
That's it for us. Thanks for watching. "ERIN BURNETT OUTFRONT" starts now.