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Interview with Mavis Leno; Monica Lewinsky Breaks Silence on Clinton Affair; Interview with Marco Rubio
Aired May 6, 2014 - 21:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
BILL WEIR, CNN HOST: I'm Bill Weir. Welcome to CNN Tonight.
An A list crowd gathers at the Beverly Hills Hotel but they are not there to sip bubbly and discuss show biz. No, they are protesting against the hotel owner, the Sultan of Brunei, after he laid down a positively medieval set of laws back in his country on the other side of the world. Laws that would punish adultery, abortion, same-sex relationships with whips and deadly stonings.
Tonight, Jay Leno's wife Mavis tells me how she and her husband are fighting back.
Plus, a 20 something intern has an affair with the president in the White House setting off a scandal that threatens to end his very administration. If you weren't around back in '98 you might think that's a plot line from "Scandal" or "House of Cards". But a lot of people around here remember it all too well. After being defined by the beret and a blue dress, Monica Lewinsky has come out of self imposed exile tonight to set the record straight on her relationship with President Bill Clinton.
She went from punch line to a life out of this (inaudible) as a student in London. And now at age 40, she's telling her story to Vanity Fair Magazine, this is the story has everybody talking and many sympathizing just as Hillary Clinton molds her own aspirations. We'll have the details tonight.
And the crash, the financial crash of 2008 shocked America, rocked this country's financial system. But the most stunning thing of all, maybe this fact, you know, it was all caused by risky greedy investment bankers, only one of them went to jail, one. Why? How? Is the best our justice department could do? We have a look at the unsettling answers later in the show.
But let us begin tonight with the fight over Sharia Law versus American values. One that is raging oddly enough from the tiny nation of Brunei to the Beverly Hills Hotel. For generations, it has been a luxurious hideaway for the famous, and fabulous, many a celeb honeymoon and hangover was built in those lush corridors just out Sunset Boulevard. I love this photograph. This is Faye Dunaway savoring her Oscar win pool side in 1977. But thanks to one of the owners of that pool in that hotel, any woman who shows that much leg in his country today could get six months in prison for indecency. Another two years for sipping champagne in public. And those are the easy punishments.
The man is the Sultan of Brunei who in addition to the Beverly Hills Hotel also has three wives, an 1,800 room palace, and vast reserves of oil and natural gas which is how the leader of a South Asian Nation smaller than Delaware gets the red carpet from President Obama. John Kerry visited his country twice last year but you have to wonder how this relationship will go now that the Sultan has decried and decided that all the people will live under strict Sharia Law in his land.
Ye, he is bringing back that form of Islam that cuts the hands of thieves and stones to death, adulterers and homosexuals or anyone caught insulting the Quran. And being a Non-Muslim not a defense which has to trouble around 25 percent of the people in his nation.
Now, back in L.A. when major LGBT organization caught wind into this they canceled the big conference at the hotel. Ellen DeGeneres tweeted her vow never to stay there again until all this is all sorted out. Richard Branson joined the boycott as did the former Sultan of late night Jay Leno.
(BEGIN VIDEO CLIP)
JAY LENO, FORMER NBC "THE TONIGHT SHOW" HOST: It's not a political issue. This is not something that's debatable. It's people being stoned to death. Hello?
(END VIDEO CLIP)
SCHULTZ: Common sense Jay. And as the Beverly Hills City council meets tonight over this action, we are joined now by Mavis Leno, long a champion for women's rights around the world. Mavis, great to have you here, thanks for taking the time.
MAVIS LENO, AMERICAN FEMINIST: I'm very pleased to be here to talk about this issue.
SCHULTZ: How did you on Jay discover what was going on in there with the Sultanate?
M. LENO: I got home from a trip that was on, and the following night went to a party with Jay where I ran into Rob Reiner. I was very jetlagged, so he said to me, "Did you hear what's happening at the Beverly Hills Hotel?" and I said "No" and he told me what was going on and that people were pulling their parties and so on. And I said, "Oh wow that's amazing". Walked off and then about a minute later when my jetlag subsided, I realized, "Oh my gosh, the feminist majority of the organization I set on the board is having a fundraiser there in week".
And so of course we pulled our fundraiser from the hotel and threw an incredible combination of luck and kindness from friends we were able to find another venue for it in time. And that's how I found out and we, you know, the word just spreads like wild fire in this community anyway. And so we decided to throw up a kind of a strike.
M. LENO: And protest ...
M. LENO: ... in the part right across from the Beverly Hills Hotel.
WEIR: Is that -- OK, yeah I know where that is. Now ...
M. LENO: Yeah.
WEIR: ... we talked -- the hotel is actually owned by a group called the Dorchester Collection and the CEO has spoke to CNN today and said, "Look, we appreciate what you're saying, your message but the Sultan has $20 billion. This is not going to put a dent in him and who you might really be hurting are the folks on the wait staff or the front desk who may agree with you but, you know, just one of those jobs." What would you say to that?
M. LENO: Well, I absolutely feel terrible about the circumstance of these people. You know, I never had any money until I was in my 30s. Before that, I was broke -- happy but broke and I know what it is to worry about the rent and payments on things and so forth and I feel very badly but this is the only way that we can reach the Sultan and this is a huge human rights issue. As hard as it is perhaps on the hotels that are being shunned, it's a little bit harder to be executed in a public square and stoned to death because you're gay or sentenced to 100 lashes because as a woman you are accused of adultery.
And by the way, rape is adultery there. It doesn't matter what the circumstance are, where the woman was, perhaps coerced or violently forced to be with another man. They're not interested in that, that's it for you. And these are a lot more serious issues.
M. LENO: And I don't, you know, I doubt that this is going to go on and on as a situation either the Sultan will decide that the hotel is too much of a nuisance to him at the best himself or perhaps he doesn't want to be in international pariah and he will think again.
I have to say to you at CNN, all you people that are supporting the news, I have a big question as to why the Sultan of Brunei suddenly out of the blue decided to do this because this is not his history as a person.
WEIR: Right he says it has to ...
M. LENO: So, what's up?
WEIR: ... he's honoring the 30-year anniversary of independence from Britain, strange way to celebrate an anniversary.
M. LENO: Yeah, right.
WEIR: Usually you buy some crystal and set off some fireworks. Your husband, I guess one of your advantages of having him around the house is you can get him involved. He framed this quite eloquently I guess a couple of nights ago. Here, let's listen to Jay.
(BEGIN VIDEO CLIP)
J. LENO: Evil flourishes when good people do nothing. These are not crazy feminist wackos, they're women who just try protect other women, and gay people protecting other gay. I mean it's just -- I don't know Berlin? 1933, hello? I mean does it seem that far off from what happened during the Holocaust?
(END VIDEO CLIP)
WEIR: You know, he also invoked those poor missing 200 plus girls who were kidnapped in Nigeria, Boko Haram we did the story last night. And I know that touches your heart, you've been active with women's rights ...
M. LENO: Yeah.
WEIR: ... in Afghanistan. Does the power of social media really mean anything do you think? And what does it take to really enact change on these kinds of huge issues?
M. LENO: Well, I think it's had a definite effect on the Nigerian situation because the leader of Nigeria was pretending that it was all fine and they were, "Oh we've taken care of that" and, you know, media revealed it to be a complete sham. And now, I assume he's actively doing something. He may just be acting like he's actively doing something, but hopefully he is taking action.
M. LENO: I can't think of anything more horrific, you know, ...
WEIR: Do you think the U.S. government should get involved?
M. LENO: ... why is it always the women? Yes, I do ...
WEIR: Send troops to go find them?
M. LENO: ... I think we should put pressure where we can. Well, I don't know about sending troops but I think we should certainly put pressure on them. Absolutely, this is intolerable and, you know, a lot of the leverage you have in international things like this is people don't, people who don't mind being bad people or putative people don't want to be embarrassed people.
M. LENO: They don't and they certainly don't want to be international pariahs and this is why we are doing this with the situation of the Sultan and this is why we should put -- our government should put pressure on the Nigerian leader.
WEIR: Well, yeah, the Sultan has shown a sort of taste for entertainers, Hollywood entertainers and maybe the cool kids can peer pressure them in the right way. Mavis Leno ... M. LENO: Right, this is -- yeah, why is he doing and find that out.
WEIR: We're on it, we're on it. I appreciate it.
M. LENO: OK.
WEIR: Thank you Mavis.
And when come back, exactly what the Clintons did not want to see as Hillary considers her own resurgence politically. It is the return of Monica Lewinsky. Details is next.
WEIR: Got to imagine you're retired but active couple living a good life in Chappaqua, New York and you moseyed to the mail box one afternoon only to find this, your husband's former flame in Vanity Fair. Boy, almost two decades after her White House internship again Monica Lewinsky is back in the public spotlight saying it is time to burn the beret and bury the blue dress. The now 40 year old is writing about her very inappropriate relationship with President Bill Clinton. And what it felt like to become the first major sacrifice on the altar of internet shame.
She says she deeply regrets what happened. That theirs was a consensual relationship and she says she wants to take back her narrative. None of that likely to be remotely good news to Bill and Hilary Clinton, but joining me now to talk about all of these is Maureen O'Connor from New York Magazine and CNN Political Commentator Ryan Lizza.
Hello to both of you.
MAUREEN O'CONNOR, NEW YORK MAGAZINE: Hello.
WEIR: Ryan, let's start with you I understand you were a young reporter about a week on the job just as this broke.
RYAN LIZZA, CNN POLITICAL COMMENTATOR: Yeah, you know, I got to Washington in January of 1998 to start at the New Republic Magazine and it's the first story I ever covered was Lewinsky back then. You know how I found out about it? I was walking to work and found out about it from a headline in one of those boxes we bought a physical newspaper. Some of your viewers out there may remember those.
WEIR: Back in the old tiny days.
LIZZA: No e-mail, no Twitter.
WEIR: But given that you're first year as a cub reporter was spend on this story what do you make of what she writes in this? She comes off really -- you feel for her.
LIZZA: Absolutely, I think it's a very sympathetic piece and I think what's happened here is she realizes that her story is not going away and she realizes that she kept her head down to Hillary Clinton's 2008 campaign. She says in the in the piece that she did that on purpose and that recent events had made her realize that if everyone else is going to talk about her and if her story is going to continue to be discussed. Then she wants to be a part of the conversation too. She has every right to talk about it.
WEIR: Right. Maureen you -- it's interesting she says she -- I mean I had to go back and look she did a reality show briefly on Fox.
O'CONNOR: She hosted a dating show actually.
WEIR: Yeah, was that -- it was Mr. Personality, one of the guys wear mask. But she had that in the first thing, but she turn down $10 million because people just wanted her to be a spectacle. How has the world change since then, that wouldn't happen today.
O'CONNOR: It's so fascinating when you look modern sex scandals say like Anthony Weiner how they're simultaneously more chase. You know, Anthony Weiner never even touched the women that he was, you know, accused of having all the sex with he never even got in the same room as them.
WEIR: Sex scandal was no sex.
O'CONNOR: Exactly, and yet afterwards there's this very toggery sort of pornographic level that these so called mistresses who never touched him then go on to have this sort of almost mistress industrial complex that they make pornos, they go on, you know, infinite reality shows. And with Monica, it was sort of the beginning of that. She did have a publicist. She did do ads for Jennifer Clegg. But by modern standards, the afterlife of it seems almost dignified now.
WEIR: Right and people don't probably hold it against sort of a especially when you're in your early 20s sexual mistake as much as people trying to capitalize off of that. And she says she writes that but really was the empathies for her for coming back into the limelight was the Tyler Clementi the young man who took his own life when he is kissing a friend at school was put on the internet. And when he -- because she was suicidal.
LIZZA: Yeah, she says in the piece that that learning about that story she had some long conversations with her mom and her mom -- well she and her mom were in tears hearing that story because she said that for long stretches of time when the scandal broke her mom would not leave her side. Because Monica Lewinsky -- she says she never actually tried to commit suicide but she often had suicidal thoughts.
And she's careful not to compare herself to Tyler Clementi and obviously his situation is very different and she says that in the piece. But she was -- she's very clear that that sort of lit a fire in her and that she describes what she calls a culture of humiliation in the modern internet culture and a lot -- the reason -- partly the reason for writing the piece is that she wants to know publicly speak out on that issue and actually be in advocate.
It's not clear from the piece how she's going to do that. But one thing that -- and I've read the full piece now, not just the excerpts but she says she's going to continue to speak out on this issue. She's -- it does not appear that she's -- this is going to be last word from her.
WEIR: What better more qualified person to talk about internet shaming. How do you think the Clintons are dealing with this or reacting to this?
O'CONNOR: Well, you know, she makes this -- Monica makes an interesting points. She points out that line in one of Beyonce's songs and says he, you know, he Monica Lewinsky-ied on my dress and she says no that's a Bill Clinton-ing, that was Bill Clinton's mess not Monica's mess. And there's -- you'd agree to which I think Bill Clinton is very beloved right now they're sort of, this sort of backslapping, sort of joking about him like he's some kind of stud or rouge when we talk about him now in his sex life.
So you just imagine that if Hillary were to be President he's the guys who'd be giving, you know, school children their tours of the White House and it seems that at least to me fair to at least hear Monica out at this point, you know, that we sort of re-embraced him. Well, let's hear where she is now at age 40 and what she now thinks looking back in sort of the first person to go through that kind of gauntlet that we've now created.
WEIR: And Ryan, if she really wanted to hurt Hillary's aspiration she could've time this much differently, right?
LIZZA: I think that's right I mean it's not -- this is very early in the presidential process. I think the question is this the last word from her or as she says in the piece at the end of the piece is she actually going to be speaking a little bit more? And is this going to be a -- is she going to be a public presence through Hillary Clinton's campaign?
She says that she had put her life on hold the last time Hillary Clinton ran for president and she feels like it's not necessary to do that anymore. So that, you know, that suggested maybe, you know, we're going to be hearing from her more than, you know, through the campaign and it is something that maybe Hillary and Bill need to deal with.
Remember, she could've destroyed Bill Clinton in a lot of ways. I think people forget that she -- the FBI wanted her to wear a wire and go implicate Clinton aides and perhaps the president herself she was, you know, early 20s in a room in Virginia with FBI agents asking her to do that and dropping that oh maybe, you know, can go to jail if you don't. And she didn't so, you know, I had a lot of sympathy for her.
She could have really damaged him back then and in so in years and frankly I think she got every right to speak out.
WEIR: Do you think that turning 40 lead ahead something to do with this. But first of all, I can't believe, she's frozen in 23 for so many -- in people's memories and go to that -- but beside the Tyler Clementi incident, what do you make at the timing of this? O'CONNOR: Well, you know, it's interesting because all that sort of initial hoopla it's hard to sort of judge somebody for the choices they make when right after, you know, she had the beginning of her career and obviously it fell apart. So she took, you know, whatever jobs available her being a hostess on TV.
Now, all these years later, I think I'm really curious to see her reflecting on it and looking back because she's not just somebody reacting to a sort of infamous moment but now she's an adult woman who's had a -- by what it seems to be, you know, a normal private life. And you see sort of her reflecting on it at this point after the culture sort of caught up to where she is.
WEIR: Go ahead, Ryan.
LIZZA: I just think it was a little sad is from the piece it seems that she tried a slot of different career paths, she went to and got a masters degree at the London school of economics. She tried various, you know, normal professions and I got the sense that this is -- as her saying she's never going to escape being Monica Lewinsky and she might as well just embrace it a little bit more, be public about it and maybe, you know, teach other people some lessons. In the sense that's sad that she never could really move on with her life and this is an acknowledgment of that.
WEIR: All right Ryan Lizza, Maureen O'Connor I'm sure both your magazines are jealous with this gig (ph) but it's a good one. We appreciate your insight thank you both.
A majority of Americans in our latest CNN poll now think terrorists took down Flight 370 that says a lot about the link between uncertainly and fear. Now, 59 days after that plane disappeared, a one of the 239 on board was Paul Weeks and I'll talk to his wife Danica when we come back.
WEIR: It is Wednesday morning already in Australia where officials from three nations will meet to plan the next steps in the search for Malaysian Airlines Flight 370. It's been nearly two months now since that jetliner carrying 239 souls vanished.
A new poll out tonight shows most Americans believe of course the search should continue. But when asked by CNN and ORC international if the jet disappeared due to a terrorist or hostile government? A majority, 57 percent, said that is the likely cause.
As we know now, an extensive search, a part of the Southern Indian Ocean where investigators believe that plane went down turned up nothing. So officials from Australia and Malaysia and China will analyze data collected so far to determine what resources are needed going forward.
And among those still keenly interest in those decisions and the search is Danica Weeks. Her husband was aboard Flight 370 and she joins us exclusively tonight of via Skype. Danica, good to see you thank you for joining us tonight. How are things changed if ever since last we spoke? How are you doing?
DANICA WEEKS, HUSBAND WAS ABOARD FLIGHT 370: Look, things have gotten worst. It's gotten hazardous as time has gone on. To be honest, I was confident, I was meeting with the (inaudible) every week and are confident they were going to find it in this high priority search area obviously. They haven't -- I've been preparing emotionally and physically to prepare a memorial for Paul.
Look, now that I haven't found anything. I'm back to day one, it's still 59 days he walked that door and we still got nothing. We're still back right where we were to begin with.
WEIR: Have the authorities, the searchers been anymore communicative with you? Do you get anymore updates on a regular basis?
WEEKS: Look, several are ringing me daily while here in Perth and with the Bluefin21 and the priority area. But look since they found nothing there, you know, I think there aren't there a bit for me as the rest of us because they look so confident they would find something. And look now, it's pretty (inaudible) back and have a look at this information again. And now I sort of haven't heard from them since then obviously they're regrouping.
But they had been keeping me in constant contact with anything that they come across. But look, they're confident when these days (inaudible) and it's as if we're back to square one and started to look in spite that they've regrouped it's important they do that because we as families it's harrowing. This is 59 days and I still have no idea what's happened to Paul.
WEIR: What do you think happened? Do you have any gut feeling?
WEEKS: Look, I can't -- it's so much conjecture and it's so much immediate posting. And look, this report that came out is contradicting segments, the authorities, Malaysian authorities had made in the early days, I just -- I can't allow myself to think about what might have happened. I looked at my -- I can think if something did happen to the plane. And to me from what I've read, it looks like he obviously tried to turn the plane around to try to get back to Kuala Lumpur.
But look, my guess is as good as any anybody, that all we have, this -- those theories into my hunch and which one is (inaudible), I hope we find out.
WEIR: We were just looking at some beautiful wedding photos with you and Paul. I know you have two little boys, 10 month old Jack, Lincoln is three. Does he understand what's happening?
WEEKS: Oh look, no he doest, he -- how do you explain to a three and half year old that he's father is not coming back. He can't -- at the house he cried everyday from him, he know he's missing from his last call, a very hands on father. And he just can't give the conflict to that, you know, daddy isn't coming back. And that's just got hotter and hotter for me. This is, you know, for the families, everyday things are hard to do. I mean my mother has been looking after us all for the last 59 days, I find it not capable to do even the smallest of things.
So it's just getting harder. And now look he doest, you know, he just keeps asking everyday, "Where's daddy? Where's daddy? Why doest he come back?" And I just have to reassure him. But, you know, he's emotional about it. Jack is one, so he's not sure -- he doesn't know what's going on but it's definitely hard with Lincoln.
WEEKS: It still has.
WEIR: They say that time rubs the edges off the herd but it certainly not in this case. Our hearts really go out for and your boys. Thank you for sharing your story with us.
WEEKS: Thank you.
WEIR: All right, Danica Weeks, trending us from down under via Skype. When we come back our crisis in Eastern Europe, is Vladimir Putin on the verge of another land grab? Is there anything Washington can do about it? Senator Marco Rubio joins me next.
WEIR: Remember when Russia took Crimea without firing a shot? It was only a few months ago, but they seem like such simpler times because the body count over on the east side of Ukraine climbs by the day. Kiev says its campaign to route Pro-Russian militants from the city of Sloviansk left 30 militants dead, an unknown member of the government casualties.
The man in the masks now occupying government buildings across that eastern part of the country vowed to defy their capital, hold a referendum on Sunday, asking locals if they want to break away from the capital, form their own government. The White House is rejecting that as an effort to divide the country.
Meanwhile the U.S. allies in Europe backing the presidential election set for May 25th. But Russians powerful Foreign Minister Sergey Lavrov questions the wisdom of an election now, while streets are burning and bullets are flying.
And joining us now, Republican senator from Florida, member of the Senate Foreign Relations Committee, Marco Rubio. Senator, thanks for being with us tonight.
SEN. MARCO RUBIO, (R) FLORIDA: Thank you for having me.
WEIR: So what is your assessment on what's happening in Ukraine? The German Foreign Minister warns citizens to leave the eastern part of that country saying the military confrontation is just a few steps away. What's going to happen? RUBIO: Well, a couple of things are already happening. First of all the Russians are continuing to try to establish a unified political arm, a Pro-Russian elements within Eastern Ukraine. You're seeing that evidence of -- in addition to that they call for this May 11th illegal referendum on separating from Ukraine and declaring independence, which is he same model they followed in Crimea.
And in fact you see all that efforts by the Russians to control the entities and the institutions that would carry out those elections. So I think the likeliest outcome and I hope that I'm wrong is a replay of what happen in Crimea, which is that they would have this vote on Sunday or some time there after and then the Russians would claim that it's a Pro-Russian elements within eastern Ukraine that are asking to be annexed and unfortunately then they would move to do the same thing they did in Crimea.
So I think right now that's where we're headed. And if you look at some of the rhetoric coming out of Moscow, they're starting to use this term called New Russia, which is really a 19th century term for Eastern Ukraine, so it's very troubling.
WEIR: Right. You wrote an Op-ed today calling for more aggressive sanctions right now. But you see these guys, you know, in their four door sedans with their machineguns and their ski goggles, will sanctions really have any effect on this sort of war by proxy?
RUBIO: Well I have called for more sanctions. The Op-ed today was about encouraging Ukraine to setup a currency board because their currency has devalued by almost 38 percent. And so, one of the things that Ukraine needs to do in order to establish independence and sovereignty is to get that currency stabilized. And so I've called in the U.S. to encourage them to -- a currency board to able to accomplish that.
As far as the sanctions are concern, look, I don't -- I think the dispute for the administration and you saw that a little bit today in the hearing we had here in Washington is the administration kind of wants to wait to impose this sanctions if Russia does anything further with regards to Eastern Ukraine. In my mind, I think we already know what's going to happen here and I think the sanctions ahead of time would clearly influence the cost benefit analysis. That's where I think it would matter.
Right now Vladimir Putin has concluded that the benefits of doing what's he's doing out way the cost. We have to change that calculus.
WEIR: But I've heard some of -- well some people across the isle, also on your committee say, if you spend too much on sanctions now and Putin will think, "Well I got nothing left to loss, we might as well roll those tanks across the border. Do you worry that too much intervention right now might antagonist this?
RUBIO: No, I -- first of all I don't thing he needs any further antagonizing. I don't think this has anything to do with being antagonistic. I think Putin has concluded that he wants Russia to be a great power. And in his mind that means the ability to have control over all the countries that neighbor him, particularly those countries that are ones part of the Soviet Union.
And as far as waiting for those sanctions to be imposed, I actually think they are more effective if they're done ahead of time. It clearly sends a message to the people around them and the people in Russia that there are significant consequences for this sort of foreign adventurism that Putin has taken them on.
WEIR: I'd like to ask you about another topic, big reports today out of the White House, this climate change report, the President put forward. 300 scientists saying this is not a future threat, it's happening right now. In fact here's President Obama this afternoon.
(BEGIN VIDEO CLIP)
BARACK OBAMA, 44TH AND CURRENT PRESIDENT OF THE UNITED STATES OF AMERICA: This is not some distant problem of the future. This is a problem that is affecting Americans right now, whether it means increase flooding, greater vulnerability to drought, more severe wild fires. All these things are having an impact on Americans as we speak.
(END VIDEO CLIP)
WEIR: Do you with that urgency?
RUBIO: You know, listen I think severe weather has been a fact of life on earth since man started recording history. I think it's -- I understand that there's a vast consensus of scientists that are saying that human activities what's contributing to changes in our climate. I think it's an enormous threats to say that every weather incident that we now read about is -- or the majority of them are attributable to human activity. But here's what we need to do as policy makers.
So that's what the President is. He's not a meteorologist. And here is what the President needs to be focused on and that is he is proposing a certain set of policies that he would have to admit if questioned, will do nothing. If in fact this scientists are right and it's a greenhouse gas emissions that are changing our climate, none of things he is proposing would do anything to change that whatsoever, but it would have a devastating impact on our economy.
We both desire at the end of the day to have more efficient fuels that are domestically produced and cost less money.
WEIR: Senator Rubio, I appreciate your insight tonight. Thanks for being with us.
RUBIO: Thank you.
WEIR: And we come back, too big to jail, millions of Americans paid a half the price for the crash of OA, but only one banker did. I'll tell you why when we come back.
WEIR: You might think that when greedy bankers do things that crater the American economy, those greedy bankers should pay with time in jail. Because after all that is been the case through history. After the crash in 29, the Pecora hearings when after the fattest of Wall Street cats and later the head of New York Stock Exchanges even sentenced to 10 years in Sing Sing. After the savings and loan scandals of the 80s, 1100 people were prosecuted.
And when tech bubble burst in the 90s and we learned that huge companies were cooking their books, executives from Enron to WorldCom to Tyco, all traded their power suits for orange jumpsuits. Even Martha Stewart did time. But in the painful years since the great recession, after so many jobs lost and live hurt the grand total of bankers behind bars tonight is one, one. And even the judge who send him away admitted he is "a small piece" of an overall all evil climate within his bank and within many other banks.
To try to figure out why, ProPublica's Jesse Eisinger spent a year digging into the system and he's here to tell us what he found. Great to have you.
JESEE EISINGER, SENIOR REPORTER, PROPUBLICA: Hi, thanks for having me.
WEIR: Congrats on a big piece on the New York Times Magazine, it's fascinating. So who is Kareem Serageldin?
WEIR: Not exactly the Al Capone.
EISINGER: No, not a household name, you know, they got the guy that cause the financial crisis.
WEIR: That's him. He is paying for the sin.
EISINGER: He was an executive at Credit Suisse, the Suisse bank and investment bank. He structured and over saw traders who structured and treated complex mortgage security. It was four rungs from the CEO. And he is the highest ranking Wall Street executive to go to prison for crimes related to financial crisis.
WEIR: And it wasn't exactly Perry Mason case in the court room because he pled guilty, right?
EISINGER: Right. They walk -- the Credit Suisse walked the case into the Southern District in New York, the U.S. attorney in Manhattan and that's the way they got him. And he pled guilty and there is no trial.
WEIR: And he owns it, right? He talk to them, I mean he says, "I am...
EISINGER: Yes, you know, why unlike this guys who really are angry about the being called banksters. You see a lot of self-righteousness from the bankers but in fact he said to me, "I'm guilty, I want to pay my debt to society." I think he felt true contrition and there's no question he's guilty. WEIR: Now if you go back to why it is that he's the only one. It's interesting. Then so the justice department had success going after Mafia families, right?
WEIR: As organizations. And they thought, "Hey why don't we go after entire corporations instead of individual white collar guys", right?
EISINGER: Right. It's a scandal. But it's a scandal that has a lot of routes in the mistakes and fiasco's that the Department of Justice has incurred over the last 10 years and adverse ruling from the court. What happens in the wake of what you talked about, the Enron, WorldCom, Adelphia, Tyco, successful prosecutions, then they go after Arthur Andersen, the famous...
WEIR: Accounting firm
EISINGER: ...accounting firm that enabled Enron. And Arthur Andersen goes out of business after they indict the firm. And the Department of Justice learns this terrible lesson, over learns it in my view, which is don't do this, don't indict companies.
WEIR: Because thousands of people lost their jobs...
WEIR: ...and there was backlash.
EISINGER: There was a terrible backlash and there were terrible consequences to this. But on the other hand Arthur Andersen was recidivist firm, they had overseen not only the bad books of Arthur -- or Enron but also waste management, some dimmed they were recidivist and they destroyed documents. And so when you confront this, prosecutors need to need out justice.
WEIR: Right. Now cash settlements then so -- there's blowback, it slings the other way, cash settlements become the punishment du jour.
WEIR: Which I never thought about it until you wrote it. Then persecutors lose their edge.
EISINGER: Yes, exactly
WEIR: Because just getting a settlement is career win. And you never have to go under court and learn how to get a guilty verdict.
EISINGER: Yes this been insidious by product of all these settlement and deferred prosecution that eroded their skills set. And its particularly eroded the skill set in with the way they go about investing individuals. So once they figure that they really can't go after corporation they tried to shift to go after individual, but over a series of fiascos and mistake. But they've realize then they lost the ability to prosecute people of the top echelon of corporate Americans.
So then get small fry but they can't get the CEO's and COF's of the biggest corporation in America.
WEIR: They lure you up like crazy. And what was interesting, its sort feeds on itself. So the crash happens. The governments into belt tightening mode, right? So the FBI had a bunch of dozen of agents go Enron. Those guys don't exist. The postal services had, right?
EISINGER: Yes, they had elite unit down in Manhattan that did complex financial investigations. And that got wind up. And then the department of justice had a hiring increase. And so they couldn't back their positions. And so there's been a terrible resource constrain in the Department of Justice, just at the moment when the needed to really gear up.
EISINGER: So not only had they had all this problems and fiascos they're willing from, things like that Ted Steven batch conviction of the senator from Alaska. All these things and all of sudden they have this resource constrains and they can't really work within the system they have.
WEIR: I want to talk, we're going to take a break. I want to talk about this HSBC thing where these guys are laundering money for cartels, doing business with Libya, Iran couldn't get them. And also what the future, if lesson has been learned and things are going to be change. Stay with us.
WEIR: Will be right back.
(BEGIN VIDEO CLIP)
SEN. ELIZABETH WARREN, (D) MASSACHUSETTS: Tell me a little bit about the last few times you've taken the biggest financial institutions on Wall Street all the way to a trial. Anybody?
HON. TOM CURRY, US COMPTROLLER OF THE CURRENCY: We do not...
CURRY: ...have to bring people to -- in trial or than it...
WARREN: Well I appreciate that you say you don't have to bring him to trial. My question is when did you bring him to trial?
CURRY: We have not had to do it as practical matter to achiever our supervisor goals.
(END VIDEO CLIP) WEIR: Little stammering there from those bank regulars. That's Senator Elizabeth Warren in her very first bank housing in Hermit Affairs Committees, scolding this guys. But has it had any effect? Her presences are any lesson learned. You see these guys toughing up.
EISINGER: Well I see them trying to respond to the political pressure. So now their making a lot of noise that they're going to actually extract guilty pleads from large banks. Now the large banks that we're talking matter happen to be foreign banks not American banks, slightly easier perhaps to bring charges against foreign bank like BNP Paribas and Credit Suisse.
EISINGER: The other issue is, we'll see if they actually bring potent guilty pleads. The word guilty is not about really what we're looking for. What we're looking for is substantive cultural change and individual charge.
WEIR: But when see this thing like HSBC which was drug cartels were using them, they had six years investigation, they were busting sanction with Iran and Libya and of just paying $650 million fund. Are they afraid the jury can understand the intricacies of time?
EISINGER: You know, I -- they were fearful of lot things and confuse about a lot things. But HSBC was something that a jury could well understand. Trading with Americas enemies, trading with the guys who cuts peoples head off and put them on spikes, that something the jury can understand. But HSBC they ended up, they, I mean, very worried about the collateral damage, the systemic problems if they indicted the firm.
And they decided that, well the bad action had taken place for so long that they couldn't find any individuals to charge. So they start threw up their hands and they have this deferred prosecution, rather than actual indictment, rather than getting individuals.
WEIR: And if all of this angers you folks, you'll going to love the fact that today the top 25 hedge fund managers in this country have record take home pay, $21 billion. And Steven Cohen is the number two on that list?
EISINGER: Right so Steven Cohen was that run SAC capital. Now eight employees of SAC capital have been charged and found guilty of insider trading. And the firm itself was indicted so he had to change the name of firm to transform it to a family office running just his money. His money turns out to be multi billions of dollars. So the punishment for Steven Cohen for running criminal operation is that he gets to earn $2.5 million -- excuse me, billion dollars...
EISINGER: ...last year. I think that's the kind of thing that most people would like to be punished that way.
WEIR: But is there anyway to fix that? Can somebody finally get -- (inaudible) to go after a guy like that.
EISINGER: Well the southern district could have brought charges against Steven Cohen for insider trading or running a corrupt organization. They could have taken the courageous step but they didn't. So why didn't they do that? And I think it's -- that their incapable of prosecuting really tough level guys, that these guys insulate themselves so much that they haven't figure out how to pierce this through prosecution.
But it also because their afraid of losing. Preet Bharara, the U. S. attorney in Manhattan, his 80 for 80 for insider training cases that's a gorgeous record, its unblemished record and he doesn't want to blemish it with the marquee prosecution of Steven Cohen.
WEIR: And what -- one word adjective would you use to describe that?
WEIR: Gutless. Jesse Eisinger, ProPublica and New York Times deal book, great reporting.
EISINGER: Thank you very much.
WEIR: Thanks for being here.
That's all for us tonight. I'll see you back here tomorrow.
CNN Special Report with Don Lemon, starts right now.