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Robert Seldon Lady in Custody; Heat Wave Rages On; Romanian Woman May Have Destroyed Priceless Works of Art; Detroit Declares Bankruptcy; Putin Opponent Freed for Now; Wal-Mart Fights Higher D.C. Wages; Kids Learn to Work at Theme Park

Aired July 19, 2013 - 12:30   ET

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

MICHAEL HOLMES, CNN ANCHOR: A spokesman for the Israeli Prime Minister Benjamin Netanyahu, however, later denied plans to negotiate '67 borders as of now.

There's a sense of anticipation in that part of the world at the moment, we must say.

A former CIA official reportedly in custody in Panama on an arrest warrant issued by Italy. His name is Robert Seldon Lady, one of 24 Americans convicted in Italy in absentia in 2009 for kidnapping a terror suspect. Italian prosecutors said he was the CIA base chief in Milan.

Now, when the suspect, Abu Omar was his name, was kidnapped from Milan by a CIA team, they say that he was in that position as base chief.

Now, the trial was the first to deal with the practice known as extraordinary rendition where suspects are allegedly swept away to a country that practices torture during interrogations. Prosecutors said Omar was transferred to Egypt and, indeed, was tortured.

The CIA station chief, yeah, he is now under arrest and we will keep you informed of developments there. Italy wanting to get him back to serve that sentence, at the moment, he's still in Panama, though

Parts of the United States, meanwhile, may finally get a break this weekend from those days of sweltering heat, a cold front expected to bring much-needed rain from the northeast to the Midwest.

For days, of course, temperatures have been into the 90s, well above, the heat index over 100 in many places.

Jennifer Delgado in the CNN Weather Center for us, Jennifer, fill us in. When is that relief coming?

JENNIFER DELGADO, AMS METEOROLOGIST: Oh, it's coming, Michael. It's going to come today for some parts of the upper Midwest, but it's still going to take a while to reach areas like the Northeast as well as New England.

As we show you right now, it is hot, hazy and humid out there. Look at all the excessive heat warnings in place across parts of the Northeast, New England, and then over toward the Midwest. Now, some of these locations heat indices, when we add in the relative humidity, with the temperature, it feels like 110 degrees to some of these parts.

Now, yes, there is going to be some relief on the way, but we're still looking at very warm conditions right now. It feels like 104 in Atlantic City. Washington, D.C., it's smoking hot there, 106. In New York, at 100.

But we do have a frontal system right now, it's already bringing some rain for areas right across parts of the upper Midwest, and that means areas like Milwaukee, Chicago, Grand Rapids, you're going to see some relief once this front comes through and bring the thunderstorms with it, and the relative humidity, it is going to be dropping.

So here is going to be the forecast for today. Looking at severe weather, anywhere in the burgundy shading. This is for Friday, and then for Saturday for areas like Pittsburgh.

And then for Saturday night for areas like Washington, D.C., as well as New York City. And that means some of these thunderstorms could be potentially kind of strong.

We're looking at a slight risk category for today and tomorrow, but here are the numbers and, Michael, this is how you know I'm not making this up. You can see the forecast.

For Friday and Saturday, Washington, D.C., you're going to be cool, but you're going to cool off on Sunday as well as into Monday and then we'll start to see temperatures slowly climbing back up as we move into the middle of next week. And the same for New York City.

But it's not just in the U.S., Michael. Look at London. We just saw Max Foster. He's outside. He's on the Kate Middleton watch for days in the heat and the temperatures there have been running about 15 degrees above average.

Smoking hot over there and they don't have air-conditioning, so hat makes it even worse.

HOLMES: Yeah, exactly. No, no, they used to call it the sizzling '70s.

DELGADO: I know. But look at 83. I mean, hello, we'll take that any day.

HOLMES: Oh, yeah, absolutely.

Why would you make anything up? You'd never do that.

DELGADO: Never do that.

HOLMES: Never. All right, Jen. Good to see you. Jennifer Delgado there, isn't she lovely?

Why would someone turn works of art into ashes? That's what investigators think happened to stolen Picassos, Matisses and Monets, an amazing story from Romania, next.

(COMMERCIAL BREAK)

HOLMES: Welcome back.

A mother, of course, will do just about anything for her son. In Romania, one woman may have incinerated millions of dollars worth of paintings, irreplaceable works of art by Matisse, Picasso, Monet, Gauguin and so on.

Why? Because police arrested her son for being involved in the theft of those masterpieces in the Netherlands last year. And her apparent reasoning? No evidence, no crime.

Atika Shubert joining us now live from London, police have found some evidence, but they're still checking into it. She could be lying.

And I know a lot of experts around the world are keeping their fingers crossed, but not hopeful. Is that right?

ATIKA SHUBERT, CNN CORRESPONDENT: Yeah, they're still sifting through the ashes and cinders that they found inside her wood-burning stove and they're really checking to see the chemical composition, whether or not that matches the seven paintings that were stolen.

At the moment what they have found is some of the oils, some of the chemical composition of the oil does seem to match some of the paintings.

But some of the paintings were also watercolor, so it's going to be very hard to prove whether or not those paintings were burned.

So what they're saying at the moment is it looks like some of the paintings were burned, but it might be impossible to tell whether or not all of them have been burned.

So they simply don't know. They say the whole process could take a few more months.

HOLMES: And her reasoning was basically to get rid of the evidence, I mean, but they think maybe she could be lying? Why would she?

SHUBERT: Well, there is that possibility. I mean, one of the problems of stealing art, of course, is then selling it on.

So she might have kept on to it, thinking maybe at some point it could be sold later. She originally buried it, actually, and then apparently, she says. dug it up and burned it.

So there is the possibility that she might have burned some of it but not others, perhaps hoping to sell them. It's going to be a lot more difficult now, though, with everybody knowing the seven paintings that were stolen.

HOLMES: That was going to be my next question to you. It's not as if you could go and put these things at Sotheby's for auction. Why would you steal something so recognizable?

SHUBERT: Yeah, what investigators of art theft say is that usually these kinds of thefts are commissioned usually by a specific collector or somebody who specifically wants those paintings, and so that's how it's done.

It's not like you steal a car and you just sell it on the black market. No, these are very specific items somebody is looking for.

However, in this case now, the items are so hot that collector may not want these items any more.

HOLMES: Yeah, really. Atika, thanks so much, Atika Shubert there. Well, there's still some chance, but it's not looking good. Atika Shubert in London.

A man who dared to speak out against the Russian president, Vladimir Putin, released from jail, his troubles, though, not over yet.

We'll have that when we come back.

(COMMERCIAL BREAK)

HOLMES: Welcome back, everyone, to AROUND THE WORLD. Let's update you on the top stories we're following today.

More evidence the self-confessed Boston Strangler, Albert DeSalvo. did commit the string of murders that terrorized Boston all those decades ago. DNA recovered from the body of one of the strangler's victims does match DeSalvo. The body was exhumed a week ago so authorities could perform the DNA test.

The Motor City running out of gas, Detroit officially bankrupt today, it is the largest municipal bankruptcy in the nation's history. Tens of thousands of city workers and retirees could see cuts in their pension plans.

Here's how Michigan Governor Rick Snyder responded to some of those concerns.

(BEGIN VIDEO CLIP)

GOVERNOR RICK SNYDER (R), MICHIGAN: With respect to retirees, one of the important things is, it's been hard to figure out how to work with them, have them have a voice at the table because the unions don't represent all the retirees.

One of the important things we proactively ask for in the bankruptcy filing is for the judge to appoint a representative for retirees because I think it's critically important they have a seat at the table, they have a voice at the table, that they can be heard.

And so bankruptcy is a process that really allows that to happen much better.

(END VIDEO CLIP)

HOLMES: Must be worrying for those people.

Snyder says that Detroit residents, meanwhile, shouldn't see any immediate changes in city services, which most the people in Detroit think are lacking anyway. He says they might actually see some improvements going forward.

Pope Francis wants the Vatican to get its financial house in order. He is a man of change, it would seem. He has appointed a special committee to make recommendations for economic reforms.

The Vatican bank has been plagued by financial scandals for years, decades, really. The pope has already started to take steps to try to fix the bank.

The new eight-person committee is made up of a cleric and others with legal and economic expertise.

A bomb went off today inside a Sunni mosque in northeast Baghdad. Iraqi police say at least 18 people are dead, more than 55 others wounded. The bomb reportedly hidden in a podium where the imam was speaking.

The violence between Iraq's Sunni and Shiite Muslims has been on the rise lately, the violence the worst in many, many years.

I said we'd go live to Moscow, so why don't we do that now? We're talking about a very prominent opposition figure in Russia, a guy who is extremely vocal about everything President Putin does, and others in his government.

This week, Alexei Navalny was tried and sentenced to five years in prison. He says he expected it all along. He says that's how President Vladimir Putin deals with his critics. Outside observers from all over the world are kind of leaning in a similar direction, actually, agreeing that Navalny's trial appears to have a political taste to it. CNN's Phil Black is in Moscow now.

Phil, Mr. Navalny is out of prison, at least for now. What's he going to do today, and what happens next in the legal process?

PHIL BLACK, CNN CORRESPONDENT: He's considering his options, Michael, after this most unexpected twist in this story. One day after his conviction and his sentencing to five years in prison, the court resumed and he was set free because the same prosecutor that had argued so long and hard that he should be sent to jail returned to court and said, actually, set him free, please, at least for the short term while he is fighting his appeal. And the prosecutor's argument was that it would be denying or somehow violating Navalny's rights if by keeping him in prison he was not allowed to continue as a candidate in Moscow's upcoming mayoral elections. The judge agreed and so Navalny was freed. But Navalny believes this decision, just like the decision to try and convict him, is being directed by the Russian government. Here's a little of what he said after his release.

(BEGIN VIDEO CLIP)

ALEXEI NAVALNY, RUSSIAN OPPOSITION LEADER (through translator): No, I am not a pet kitten or pet puppy, whom (ph) they can first throw out of the elections and say you will not take part, and then decide, OK, let him in for a month to take part in the elections. I will now return to Moscow and we will discuss everything with my electoral campaign staff.

(END VIDEO CLIP)

BLACK: Now, Russian authorities have always insisted this criminal case is not political in any way. They clearly haven't persuaded Navalny, nor have they persuaded the thousands of Russians who took to the streets angrily in Moscow and other cities last night in response to Navalny's conviction and that five-year sentence. Today, when Navalny walked free from that court, he thanked all of those people and those crowds for helping him achieve his freedom today.

Michael.

HOLMES: So is that being seen, Phil, as the reason for this, the motivation for letting him go, that they misjudged what was said after he was put in jail? I mean, otherwise, other political opponents, there's plenty of them in Russia, aren't given that opportunity.

BLACK: No, indeed. I mean, it's an interesting question. If this was a trial designed to silence him, as so much of the world believes, why then let him go? The popular theory is that, yes, it's designed to relieve pressure, to give his supporters less reason to be so angry and furious and on the streets in big numbers like they were last night. Some of his supporters suggest another longer term, perhaps more sophisticated theory, that this is a strategy designed to discredit him even more in the long run because if he now does choose to run in the race, to be the mayor of Moscow, and he loses that, as he could very well do because his support is not yet strong enough to win that, then ultimately loses his appeal against the conviction, still goes to prison, only not just as a convicted criminal, in that case he would also be a failed political candidate.

Michael.

HOLMES: Yes, it's a very tangled system, isn't it? Phil, good to see you. Phil Black there in Moscow for us today.

Wal-Mart getting help in its fight against a minimum wage change in Washington, D.C. Now Home Depot, Target, and Macy's are joining in. We'll have that when we come back.

(COMMERCIAL BREAK)

HOLMES: Wal-Mart is threatening to scrap plans to build stores in Washington, D.C. The retail giant angry over a proposed new city ordinance requiring billion-dollar companies to pay their workers at least $12.50 an hour. Several other retailers reportedly also oppose this measure. Our Athena Jones is live in Washington.

So what's the scoop? Is the mayor going to sign this or not?

ATHENA JONES, CNN CORRESPONDENT: Hi, Michael.

Well, that's the big question, will Mayor Gray sign this bill into law or will he veto it? If he vetoes it, will the D.C. counsel decide to override that veto and be able to?

Let's just say what the law does. It requires that stores with at least 75,000 square feet of spaces, so really big stores, and as you mentioned $1 billion in revenue, to provide, to pay their employees at least what D.C. council members call a living wage of $12.50 an hour. Now, that's much higher than D.C.'s minimum wage of just $8.25 an hour.

Now, supporters of this bill, including about two dozen faith leaders who held an event today, say this is all about economic justice. One reverend said he wants Mayor Gray to support the people of D.C. because he doesn't work for Wal-Mart, he works for the people of D.C.

I should mention that Wal-Mart has planned six stores, three of those are already under construction. I believe you saw some video of those just a moment ago. Two of them are set to open in the fall, but that could all change if this bill gets signed into law.

Michael.

HOLMES: Yes, and, of course, Wal-Mart saying its discriminatory. What do they mean by that in their reaction to all of this?

JONES: Well, that's right, they say it's discriminatory and that it discourages investment in D.C., which is something the mayor has said he wants. I had a chance to speak with a spokesman from Wal-Mart who pointed out that other big stores, stores like Safeway and Giant, are exempt from this and they believe that's not fair and it puts them at a - will put Wal-Mart at a competitive disadvantage with those stores. So these are the issues at hand and, of course, all six stores total, we're talking about 1,800 jobs Wal-Mart says those stores would bring to Washington, D.C. So a big deal here, Michael.

HOLMES: All right. Let's see what happens. Athena Jones in Washington, thanks so much.

JONES: Thanks.

HOLMES: Well, refugees risking their lives for a new home in Australia, paying big money to make a very dangerous journey in leaking boats. But now Australia is going to turn them around.

(COMMERCIAL BREAK)

HOLMES: Welcome back.

The poet and playwright, Oscar Wilde, once said, among many other things, work is a refuge for people who have nothing better to do. Love his stuff. Obviously he's never been to KidZania, though. That's a Japanese theme park for kids. There kids work at mock jobs, earn kid currency they can save and then spend and get a taste of what the real world is like. But unlike most of us, they're having fun at the same time. Here's Kristie Lu Stout with the story.

(BEGIN VIDEOTAPE)

KRISTIE LU STOUT, CNN CORRESPONDENT (voice-over): Pint-sized paramedics practicing first aid. Around the corner, young firefighters hose down a building. At this theme park in Japan's capital, children can get their hands dirty trying all sorts of adult jobs.

KOJI NOSE, EXECUTIVE MANAGING DIRECTOR, KIDZANIA: We have over sixty (ph) pavilions and they can stop by and some pavilions to (INAUDIBLE) make money, some pavilions spend the money.

STOUT Children select a job, change into the uniform, and after a spot of on-the-job training, they are ready for their shift at attractions sponsored by real life companies like Coca Cola and Clinique.

"It's a lot of fun because I can do things I've never done before," says this boy.

Fun and teaching kids some financial smarts on the side is what it's all about at KidZania. The company says the park broadens the children's understanding of the workplace beyond their parents' professions and encourages them to be confident, motivated and independent. While these kids work, their parents watch. And at KidZania, it pays to play.

"We work and save money so that we'll be able to buy lots of stuff," these girls tell us.

The children's hard-earned cash is kept in KidZania's very own bank, which deals in the park's currency called KidZos (ph). If they save up, they can use the bank notes on their next visit.

No matter what career they might pursue in the future, you can be sure these kids will take away more than just tasty treats from their time at KidZania.

Kristie Lu Stout, CNN, Hong Kong.

(END VIDEOTAPE)

HOLMES: All right, let's have a look at what is trending around the world right now.

Australia has a new policy to try to stop the flow of illegal boat refugees and it's getting help from a neighboring country. Prime Minister Kevin Rudd signed an agreement with Papua New Guinea today. Under it, those who enter Australia illegally from the sea will be sent there. The prime minister says future boat refugees have, quote, "no chance of getting asylum in Australia." Human smugglers have been exploiting refugees for many years, taking their money, a lot of it, and putting their lives at risk in leaky boats promising them a new home in Australia. Hundreds of people have drowned after those boats have capsized over the years. That's it for me, meanwhile. Thanks for watching AROUND THE WORLD. Appreciate your company. CNN NEWSROOM starts right now with Wolf Blitzer.