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Hunt for Copy Killer Suspect; JetBlue Scare; Scotland Rejects Independence; The U.S. Battle Plan against ISIS; 56 Million Credit and Debit Cards Affected by Home Depot Hack; Police Searching for Missing UVA Student

Aired September 19, 2014 - 09:00   ET

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

CAROL COSTELLO, CNN ANCHOR: NEWSROOM starts now.

(BEGIN VIDEOTAPE)

COSTELLO: Happening now in the NEWSROOM most wanted.

GEORGE BIVENS, DEPUTY COMMISSIONER OF OPERATIONS: The suspect is still considered armed and dangerous.

COSTELLO: Eric Matthew Frein suspected cop killer on the run.

UNIDENTIFIED MALE: He is a hunter. He is a woodsman. And he is alleged to be a survivalist. That is a deadly cocktail.

COSTELLO: Small town Pennsylvania on edge this morning.

UNIDENTIFIED MALE: People are uneasy. I mean, they want to know are my kids going to be safe?

COSTELLO: Also, ready to strike. American warplanes targeting terrorists in Iraq. As Obama's ISIS plan clears a major hurdle.

UNIDENTIFIED MALE: Ladies and gentlemen, we've got a right engine failure.

COSTELLO: And terrifying moments at 10,000 feet.

DEAN DELBAUGH, PASSENGER: I heard a weird noise, the landing gear came up and then a pop.

COSTELLO: A JetBlue flight. The cabin filled with smoke.

DELBAUGH: I thought this was it, my wife was right next to me, and she was crying, and I was like, well, here we go.

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: This is where it all starts. Alibaba will ring the Opening Bell.

COSTELLO: It could be the biggest business transaction in the entire world.

UNIDENTIFIED MALE: This is really -- it's like 12 companies. It's the -- you know, the eBay and the Amazon and PayPal is pretty easy but it's a Netflix, it's a GroupOn.

COSTELLO: We'll introduce you to Alibaba. Let's talk, live in CNN NEWSROOM.

(END VIDEOTAPE)

COSTELLO: Good morning, I'm Carol Costello. Thanks so much for joining me.

We begin this morning just outside of Scranton, Pennsylvania, where fear and anxiety are replacing calm and quiet in a small rural town. An accused cop killer is on the loose and the city's residents are on the lookout. The FBI has now added Eric Frein to its 10 most wanted list and is offering a $100,000 reward for information leading to his capture. That's on top of the $75,000 Pennsylvania CrimeStoppers is already offering.

Frein is accused of opening fire on a police barracks last Friday killing one state trooper and wounding another before disappearing into the woods.

Let's bring in Jason Carroll, he's about 20 miles southeast of Scranton.

Tell us more, Jason.

JASON CARROLL, CNN NATIONAL CORRESPONDENT: Well, we're here in actually Canadensis, Pennsylvania. This is the small community where people actually remember Eric Frein walking these streets, Carol, in full military gear. So you can imagine how nervous people were last night after police received a credible tip that Eric Frein was out here in the area near the home where he grew up with his parents.

So what police did is they sent in a very heavy police presence that we saw out here last night, armored cars, helicopters, armed police, state police, patrolling the streets. They actually blocked off the streets leading into the neighborhood where Eric Frein grew up. Investigators saying actually early yesterday afternoon they basically feel as though they have many tips, many leads leading them to believe that Eric Frein may still be in the area.

(BEGIN VIDEO CLIP)

BIVENS: At this point we have additional reason to believe that the subject still remains in the area. We're fairly confident of that information. So while we continue to follow up on any other tips or leads that we get, regardless of where those are, we have really focused our search efforts over a -- you know, a fairly broad geographic area.

(END VIDEO CLIP)

CARROLL: And when it comes to that broad area that they're talking about, much of it is as you can imagine, Carol, a heavily wooded area. And so what they're basically doing is working on a grid system and systematically trying to eliminate things like abandoned cabins and campsites, things of that nature, hoping that will some way help them narrow their search. State police also telling us they're holding back on releasing a lot of information about their investigation because they also have reason to believe that Frein may have access to news reports and may be listening -- Carol.

COSTELLO: Tell us more about this militia group that Frein supposedly belonged to and then police say he became delusional and started to believe that everything was real about this group that he belonged to.

CARROLL: Well, you know, that's debatable, Carol. You know, this airsoft group that he belonged to, these are basically sort of like a real life gaming community, and some of those that we have spoken to, basically what they do is they re-enact military scenes, combat scenes, they do it out in the woods, things of that nature. Some of those people who we've spoken to on the phone about this say, look, this is harmless, good fun, and some people take it to the extreme. And in the wrong direction, case in point Frein.

So this is one group that he belonged to but this is a young man who basically grew up with guns, grew up liking the military lifestyle, again, many people that we spoke to in this community here remember seeing him walking around in full military gear. They actually thought he was in the military, he was not. So this is someone who had a love of guns. He's well versed with guns. His father has said and told investigators that when it comes to shooting, that he rarely misses.

COSTELLO: Jason Carroll reporting live from near Scranton, Pennsylvania, this morning.

Some harrowing moments aboard a JetBlue flight. Smoke filled the cabin and so did panic, just minutes after takeoff. Listen to this passenger.

(BEGIN VIDEO CLIP)

JONATHAN HUBBARD, PASSENGER: The engine blew out. We were out over the ocean --

UNIDENTIFIED REPORTER: Wait, wait. What do you mean the engine blew up?

HUBBARD: Our right engine blew out.

UNIDENTIFIED REPORTER: You actually heard it?

HUBBARD: Yes. It popped, blew out, smoke engulfed the cabin where you couldn't see the person next to you.

UNIDENTIFIED REPORTER: That bad?

HUBBARD: It was that bad.

(END VIDEO CLIP)

COSTELLO: Scary, right? With emergency vehicles lining the runway the plane landed. Several passengers were hurt in the frantic scramble to safety and much of the ordeal caught on cell phone cameras.

Here's more from Stephanie Elam.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: Ladies and gentlemen, we've had a right engine failure.

STEPHANIE ELAM, CNN CORRESPONDENT: Terrifying new video from inside the cabin of JetBlue Flight 1416, the air thick with smoke.

UNIDENTIFIED FEMALE: Keep your seatbelts fastened.

ELAM: It was just shortly after takeoff when something went wrong.

DELBAUGH: I heard a weird noise. The landing gear came up and a pop.

ELAM: While en route to Austin, Texas, from Long Beach, California, the airline says there was an issue with the number two engine on the plane.

UNIDENTIFIED MALE: Please stay in your seats so we'll try and clear the cabin of smoke. Thank you.

ELAM: The oxygen masks failed to deploy, according to one passenger, forcing the attendants to manually release them.

DELBAUGH: We're way over the ocean probably a couple of miles out and then you immediately got the smell and it obviously something burning.

ELAM: The pilot immediately turned the plane back to Long Beach.

You can hear babies crying as the 142 passengers and five crew members brace for an emergency landing.

DELBAUGH: Once we turn around and got over land it was very -- you know, it was jarring all over the place and then people started to get really worried.

ELAM: He thought he was going to die.

DELBAUGH: I thought this was it. My wife was right next to me, we were going on vacation and I was like -- she held me, she was crying, and I was like, well, here we go.

JARROD WEST, PASSENGER: The scariest part of the whole thing probably was when we were coming down for landing and the flight attendants, they were yelling, "Brace, brace, brace."

UNIDENTIFIED FEMALE: Brace, brace, brace.

WEST: And they kept repeating it and repeating it and repeating it. And it was at the top of their lungs.

ELAM: After landing safely, a round of applause from all on board.

UNIDENTIFIED MALE: JetBlue 1416 is on the ground. JetBlue 1416 will be evacuating.

ELAM: The control tower told the pilots smoke wasn't coming from the engine. But the passengers weren't waiting, they quickly escaped down the slides.

UNIDENTIFIED MALE: Well, I figured, you know, it was going to be too hot to wear black.

ELAM: Celeb passenger "Twilight" actor Jackson Rathbone --

JACKSON RATHBONE, ACTOR: I never lost a fight.

ELAM: -- tweeting photos of everyone crowding the tarmac including his family. The plane in the background.

Four people were injured, thankfully none seriously.

WEST: I'm just happy to be alive. You know? I don't think I'll ever be mean to anybody ever again.

ELAM: Stephanie Elam, CNN, Los Angeles.

(END VIDEOTAPE)

COSTELLO: Wow.

A new development in the international fight against ISIS. Just a few hours ago, France's president confirmed that his warplanes launched their first strikes against the terror group in Iraq. He says France's air strike completely destroyed a warehouse in northeastern Iraq.

In the meantime, U.S. military officials tell CNN that ISIS is modifying its behavior to become more elusive from those future air strikes.

Here's CNN chief national security correspondent Jim Sciutto.

(BEGIN VIDEOTAPE)

JIM SCIUTTO, CNN CHIEF NATIONAL SECURITY CORRESPONDENT (voice-over): Today U.S. war planes destroying a new kind of ISIS target in Iraq. A training camp near the stronghold of Mosul. The strike eliminating an armed vehicle, two buildings and a group of militants. This as the war on ISIS as it moves from defense to offense.

Testifying on the Hill, Secretary of State John Kerry described the group as far from invincible.

JOHN KERRY, SECRETARY OF STATE: I don't think these guys are 10 feet tall and the intelligence tells us that as we've begun to hit them, we've been able to prove that to some degree. SCIUTTO: The U.S. battle plan still does not include U.S. troops in

combat, though the vice president, like General Martin Dempsey before him, appeared to leave that option open to consideration, telling reporters in Iowa, that will be determined, quote, "based on how the effort goes."

For now, though, the burden will fall entirely on indigenous ground forces. In Syria, the goal is to create a rebel force of roughly 5,000, capable of fighting in large, organized units rather than in small teams. The Pentagon says, however, that training such a force could take a full year.

In Iraq, Iraqi and Kurdish forces will fight on the ground. The U.S. advisers have now determined that no more than half of the Iraqi army is fit to partner with U.S. forces. The rest either poorly led or dominated by Shiite militias.

Speaking before the House Armed Services Committee, Defense Secretary Chuck Hagel again spoke of a long, difficult military campaign.

CHUCK HAGEL, DEFENSE SECRETARY: This effort will not be simple. We are at war with ISIL, just as we are at war with al Qaeda.

SCIUTTO: Jim Sciutto, CNN, Washington.

(END VIDEOTAPE)

COSTELLO: It's official, Scotland will remain part of the United Kingdom.

(CHEERS AND APPLAUSE)

That was the reaction from pro-union voters earlier today as the results from the historic referendum vote came in. 55 percent of voters said no to the measure. The undecideds clearly breaking open a vote that had been too close to call. For some, though, the results were heartbreaking, weeks of hard campaigning were not enough to sway the public toward independence.

Outside of 10 Downing Street Prime Minister David Cameron praised the results.

(BEGIN VIDEO CLIP)

DAVID CAMERON, BRITISH PRIME MINISTER: The people of Scotland have spoken, and it is a clear result. They've kept our country of four nations together. And like millions of other people, I am delighted.

(END VIDEO CLIP)

COSTELLO: Cameron also addressed those disappointed by the vote. He encouraged voters to see the referendum as an opportunity for change moving forward.

Still to come in the NEWSROOM, we now know that big -- how big that security breach is at Home Depot. Christine Romans tracking that story for us this morning.

Hi.

CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: Carol, Home Depot has a dubious distinction this morning. It is home to the biggest hack in history.

I'll have that right after the break.

(COMMERCIAL BREAK)

COSTELLO: Checking some top stories for you at 15 minutes past the hour.

Joan Rivers' personal doctor issues two flat-out denials. Dr. Gwen Korovin says she did not perform an unauthorized procedure before the comedienne suffered cardiac arrest. The doctor also denies snapping a selfie while Rivers was under anesthesia at that Manhattan clinic. That's contrary to what a source close to the investigation told CNN. Tonight Rivers' daughter Melissa will make her first television appearance since her mother's death on an E! news special celebrating her mother's life.

In Hawaii, scientists are keeping a wary eye on the slow-moving lava flowing from the continuously erupting Kilauea volcano. The lava threatens to isolate more than 8,000 people as it creeps toward a main highway on the Big Island. So far, geologists can't predict when the lava will stop.

Today is the day for thousands of people who camped out overnight at Apple stores to finally get their hands on the new iPhone 6. Apple has raked in a record 4 million orders in just 24 hours and says walk- in customers will find only a limited supply of phones today.

Home Depot has a brand new distinction -- its credit and debit card hack is bigger than Target's. Much bigger. Here are the numbers -- some 56 million cards have been compromised at Home Depot, while at Target, hackers got their hands on 40 million.

Let's talk about that with CNN money's Christine Romans.

ROMANS: 56 million debit and credit cards. And it went on for so much longer than the Target hack. The Target was noticed after I think about three weeks. This went on for months, Carol, all the way back -- as far back as April, hackers have been able to just skim this information from the point of sale systems at Home Depot.

COSTELLO: Was there some way Home Depot should have known?

ROMANS: You know, I say, yes, the retailer should have known. I mean, it was a cyber security blogger and then the banks at the same time and law enforcement that were starting to notice that, on the dark web, your information was for sale. And so they alerted Home Depot and Home Depot now says that they've been able to shut it down, they've been able to find this malware that was put on the payment systems and operated freely for all of those months. They have shut it down now, but retailers -- security experts have told me retailers are among the weakest, the weakest, in terms of cyber security.

COSTELLO: So the people who planted the malware, they're still out there somewhere, right?

ROMANS: Yep. Devising new malware I'm sure, for another -- and Home Depot says they've never seen this malware before, it was a custom sort of one-of-a-kind kind of just-for-Home Depot malware that they put on there, but that's what these hackers do. They try to knock on the door, they find the weak door; they try to find a door that's unlocked and they get in, and then they run rampant with our stuff.

56 million -- I mean, this gives it the distinction of being bigger than Target, probably the biggest retail hack in history.

COSTELLO: So what should do you if you have a Home Depot card or a debit or a credit card, right?

ROMANS: Even if you didn't shop at Home Depot, what you should do is you should check your statements going all the way back to April. Everybody should, because these hackers have -- every month there's been a retailer that's been hit. Go back to April.

Home Depot apologizes for this and says that they're going to give free credit monitoring. You should take advantage of that. However, when it turns into something you have to pay for every month, then don't. Just don't -- don't give somebody money to do what they should have been doing in the first place, which is keeping your information safe. You just check yourself.

And your bank may have already alerted you. Your bank is looking and has software to find patterns that are different in your behavior. So trust your bank if your bank says we see something fishy.

COSTELLO: Christine Romans, thanks as always. I appreciate it.

Still to come in the NEWSROOM, new surveillance pictures of the night 18-year-old University of Virginia student Heather Graham (sic) went missing. And how police hope they will inspire someone to come forward to figure out why she vanished that night.

(COMMERCIAL BREAK)

COSTELLO: She is one of at least four women who've gone missing in Virginia over the last five years. University of Virginia sophomore Hannah Graham was last heard from September 13th, when she left a party and then sent a text message to friends.

These new surveillance images that police hope could help them construct a timeline, the images show a man following Hannah on foot near a downtown Charlottesville mall. And police now have a person of interest that they're trying to track down in the case. They're looking to are a black male in his late 20s or early 30s, about 5'10", 250 to 285 pounds, with a close-shaved head, a goatee and slight beer belly. Now, the case stirs up difficult memories for the parents of the other

women whose cases have never been solved. Last night the mother of Morgan Harrington talked about whether the disappearances are connected.

(BEGIN VIDEO CLIP)

GIL HARRINGTON, DAUGHTER DISAPPEARED NEAR SAME AREA AS UVA STUDENT: I really don't know if it is a cluster phenomenon that just is kind of a coincidence or if it is actually a pattern of a predator. Even if you take part of them out as non-pertinent to one predator, if it is just a cluster phenomenon of crime, that is still a problem that needs to be fixed. If it's one man, a top-tier predator who's in that area, we need to find him.

(END VIDEO CLIP)

COSTELLO: The FBI also trying to help find Hannah Graham, attempting to piece together her movements of that night through some of her text messages to friends.

CNN's Randi Kaye has more for you.

(BEGIN VIDEOTAPE)

RANDI KAYE, CNN CORRESPONDENT (voice-over): New video of University of Virginia student Hannah Graham caught on camera while out for a long night of drinking with friends. As times, she appears disoriented and confused. At 1:06 a.m. these surveillance cameras show Hannah on the mall in downtown Charlottesville. See the man in the light colored shorts? He ducks into a doorway. When Hannah passes by, he follows her.

CHIEF TIMOTHY LONGO, CHARLOTTESVILLE, VA. POLICE: She was vulnerable, that she may not have been in a position to protect herself or defend herself.

KAYE: The man seen in the video tailing Hannah told police she appeared distressed, and he wanted to make sure she was safe. Also that he stopped following her after he saw a black man approach Hannah and put his arm around her. Police have not commented whether or not they believed the first man's story.

As for the second man, he isn't seen anywhere in the surveillance video, though, late Thursday, police did say they want to speak with him. About 20 minutes after Hannah was seen on that mall surveillance camera, 1:20 a.m., police say she texted friends about a party, but never showed up. The text was the last anyone heard from her.

LONGO: There was a particular text that would lead us to believe she was lost.

KAYE: Lost in an area police say she was familiar with. And there's more. Surveillance video from earlier in the night, 9:30 p.m. Friday night. That's when Hannah Graham left her apartment. She grabbed dinner with friends, then went to a party. After leaving that party around 12:15 a.m. Saturday, she headed toward an Irish pub. 45 minutes later, about 1:00 a.m., police say cameras caught Hannah running toward the downtown mall. Strangely, nobody appeared to be chasing her.

Which brings us back to this video, a jewelry store on the mall at 1:08 a.m., the last time Hannah Graham was seen on camera alive.

LONGO: Pick up the phone and tell us something, regardless of how insignificant you think it might be.

KAYE: Her parents released this statement: "Hannah is beyond precious to us. We are truly devastated by her disappearance. It's totally out of character for us not to have heard from her and we fear foul play."

And they may have good reason to. At least three other young women have disappeared here in the last five years, including Virginia Tech student Morgan Harrington. She went missing in 2009 after a rock concert at UVA. No arrests were ever made. Police have reportedly checked the area where Harrington's remains were found for clues in this latest case. That has some raising concerns about a possible serial killer, but police remain laser focused on finding Hannah Graham.

Randi Kaye, CNN, New York.

(END VIDEOTAPE)

COSTELLO: So if you know anything, please pick up the phone.

Still to come in the NEWSROOM, do you know what Alibaba is? Is it like eBay or Amazon? What about OpenTable or even Uber? It's actually all of them combined. The e-commerce giant is making history this morning. Alison Kosik is live at the New York Stock Exchange. Hi Alison.

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Hi, Carol. Just minutes ago before the opening bell, but believe it or not, Alibaba will not be opening its doors for business, at least at the New York Stock Exchange, when that happens. I will explain why right after this.

(COMMERCIAL BREAK)