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QUEST MEANS BUSINESS

World Leaders Warn Against Brexit; Brexit Vote Divides Families; Yellen: Rate Hike Could Come Soon; Yellen: Rate Hike Likely in Coming Months; Trump: Inappropriate to Debate Sanders; Trump: U.S. Must Be Energy Independent; Feds Probe Bank of Bangladesh Hack; Doctors Call for Olympics to be Postponed; Li: Not Worried About U.S.-China Trade Relations

Aired May 27, 2016 - 16:00:00   ET

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


[16:00:00] RICHARD QUEST, CNN ANCHOR: Well, it was a bit of an odd sort of a day but the market seems to have closed nearly at the peak. Only a gain

of around 36 points, 38 points. Still comfortably over 17,800. I'm feeling good about today's gavel. And I was wrong. It's Friday, it's the

27th of May.

Tonight, no nation is an island. And the G7 leaders say they're worried about a Brexit. Here comes the summer. Janet Yellen is ready to raise

rates. When appropriate. What does that mean? And next big banking crisis may have ties to North Korea. FBI is investigating. It's Friday,

I'm Richard Quest. We have an hour together. And I mean business.

Good evening. Tonight, leaders from the G7 industrialized countries have warned about the impact of Britain leaving the European Union as the debate

over the U.K.'s referendum gets ever more bitter. The heads of the G7 held their annual summit in Japan and said, "A British withdrawal would not just

hurt the United Kingdom, it would hurt growth across the world. The communique said, "a U.K. exit if the EU would reverse the trend towards

greater global trade and investment and the jobs they create." It's a further serious risk to growth is what they put in the statement. The

British Prime Minister David Cameron said the other G7 countries are not trying to influence the vote. They're offering advice.

(BEGIN VIDEO CLIP)

DAVID CAMERON, BRITISH PRIME MINISTER: President Obama and Prime Minister Abe and others have made their views clear. And when they have done so,

quite rightly, they've always said it is a matter for the British public. I think we should listen to our friends. We should listen to people who

want us to do well, who wish well of us in the world. When your face by a difficult decision, it's often a good thing to listen what your friends

think.

(END VIDEO CLIP)

QUEST: Supporters of a U.K. exit argue that world leaders can't possibly know what the economic impact will really be as the U.K. gets ready to in

or out the big decision. Past G7 and G8 summits have a poor record. I've got them here. When it comes to predicting economic trends. In 2007, the

G8, Russia was part of it in those days, declared we note that the world economy is in good condition. Hmm. After that, the foreclosure crisis

started. The mortgage providers fell and the credit crunch had banks around the world collapsing.

Not to be daunted in 2008 said, "We remain positive about the long-term resilience of our economies and future global economic growth." Two months

later, Lehman's went bust and there was no stopping the financial collapse. Putting it altogether, you really have to ask when the G7 makes those

comments about Brexit, are they right? Anthony Chan, chief economist at Chase. I'm not asking you to take sides on Brexit. You wouldn't anyway.

But are these warnings right?

ANTHONY CHAN, CHIEF ECONOMIST, CHASE: Well, as you know, Richard, that's a decision for the British people to make and for them to make alone. But

when you look at a lot of the economic studies out there, I think it's clear that whenever something happens like that, you get higher uncertainty

and higher uncertainty never leads to faster economic growth. In fact, the reverse occurs. It leads to slower economic growth.

QUEST: Except, we're going to hear in a moment from one of the most ardent leave campaigners. Numerous advisers said, Britain should be in the

ERM. That was a disaster. They said Britain should join the euro. Just as well it didn't. So should we take the treasury report, the IMF, the

OECD and now did G7? Why should we believe them?

CHAN: It's not a question if you believe them or not, 44 percent of all the exports of the UK go to the rest of the European Union. And there's no

doubt in anyone's mind if this were to break down that would be interrupted. Is the interruption short term, long term? That depends on

the negotiating abilities of the countries involved. But there would be a period of uncertainty and during that period we will see slower economic

growth.

QUEST: So as we get closer towards the vote, which is June 23rd, where should we look to see this uncertainty? Because as long as the polls

remain 50-50, we are going to see uncertainty.

CHAN: Richard, if you have seen the polls recently and look at all of them you basically see that the remain vote has in fact been gathering some

momentum. And in fact right now, on average, is about a 6-point lead of the remaining over the leave. And in fact the bookmakers out there, if you

take a survey of many of them, they're only placing about a 20 percent possibility of leave and 80 percent probability of actually remain. But

the actual polls are still leaning a little bit in the direction by 6 points of remain. So I don't think the level of uncertainty has to be

closer to the June -- the poll is all that troubling to me.

[16:05:00] QUEST: I want to just talk about if we made the dollar at the moment, the G20 talked about the dollar. The G7 in their communique, it

was very long communique. Went on for pages and had in it except for the kitchen sink. But they talk about warning against using or manipulating

currencies or improper use of foreign exchange. Why are we seeing the dollar rising at the moment?

CHAN: I think, Richard, the reason we're seeing the dollar rising is primarily because the U.S. economy seems to be improving gradually. We saw

an upward revision of first quarter real GDP today and in fact we know that in the second quarter growth is going to be in an excess of 2 percent. In

fact, the Atlanta now cast forecasting tool is saying 2.5 percent growth in the second quarter. And of course, Janet Yellen basically telling us

they're going to raise rates. So what are the determiners of foreign exchange rates? Relative growth and relative interest rates and both of

them are going in the direction of favor, a slightly stronger dollar. Slightly because rates will go up gradually and growth is only slightly

getting stronger.

QUEST: Why did the G20 make such a fuss with Japan? And indeed, with China, on this question of the dollar? I mean, I know obviously we've seen

a certain appreciation in some cases and certain countries like China are supposedly weakening and Japan continues to want to weaken and the numbers

are still small.

CHAN: Richard, those are great questions. Very quickly, in Japan, it is very clear. The Japanese have been emitting signals they want to weaken

their currency. Our treasury secretary is saying, forget about it. We'd rather not let you do that unless it's critical. And that's one of the

reasons why you continue to hear more and more noise out of Japan that there is a critical stage. With the regard to the Chinese, of course

they've moved to a basket currency. But what you've seen, if you look at that relationship between the dollar and the renminbi is that that tight

relationship is getting weaker. So that is something that is of concern because the Chinese economy is slowing down and they could be tempted to

weaken their renminbi to strengthen economic growth.

QUEST: We'll talk more about this. No doubt you'll be watching Brexit very closely indeed.

CHAN: Thank you.

QUEST: Good to see you.

The Brexit campaign's number crunching is very much in the spotlight. The numbers -- well, the numbers and the vote leave, the main pro-Brexit

campaign -- the claim is that the U.K. pays more than half a billion dollars every week. This is how they put it. The big campaign. Let's

give our national health service the 350 million pounds about, half a billion, that the EU takes every week. That's how the vote leave puts it,

350 million pounds, about half a billion.

Now, Britain's guardian of official statistics says that this claim is misleading and because it's misleading and the way it's being used its

undermining trust in the official statistics. Why do they say that? Well, that 350 million, join me at the super screen, and you'll see exactly why.

The British government figures say because that 350 million is a gross number. The government figures say it contributed just around $28 billion

over the course of last year, 2014. That doesn't take account of the so- called Fontainebleau abatement into account. This was an abatement negotiated under Margaret Thatcher many years ago. So on that gross

number, which works out to that, you get a 6.5 billion rebate back. The statistics authorities say, the vote leave does not include the rebate.

Furthermore, another 7 billion comes back to the U.K. through various funds, the cap, the public and private, the university grants and the like.

So your gross number here has to be discounted by these rebates. So leave actually doesn't have the full numbers. Actual fact, it's $515 million is

the weekly spend on the U.K. says leave. But the real number is probably much closer to $277 million, which is according to the ONS. It's all about

the difference between the gross and the net. So I put this very point to the leave campaigner, and the conservative member of parliament John

Redwood and asked him, if he agreed that the numbers were being taken out of context.

(BEGIN VIDEOTAPE)

JOHN REDWOOD, CONSERVATIVE MEMBER OF UK PARLIAMENT: The vote leave campaign has been very clear throughout that we do have a charge of 350

million pounds a week gross. And we've always stated very clearly it's a gross figure and that is an official government figure. And I think you

will find the official government statisticians will endorse that number. We've always made clear there is a modest rebate.

[16:10:00] That there are some expenditures by the EU on farming and universities and one or two other things in the United Kingdom, which we

make direct if we didn't have to make it via Brussels. And then there's a 10,000 million pounds a year, which is a lot of money to our country.

Which we don't get back and that is the money we wish to have back to spend on our priorities and to provide a boost to our economy. And it will mean

that far from shrinking our economy will grow more because we have our own money to spend and the balance of payments improve because that is of

course money we have to send abroad and it's a negative on the balance payments.

QUEST: I can understand why either side wants to make the numbers look as big or as bad to boost their position. But the upshot of it is that the

net amount is not as much as the leave campaign suggests.

REDWOOD: Well, that's not true. We constantly tell you that the net amount is around 10,000 million pounds a year, which comes from the

official government figures, and we tell you the gross amount is 350 million pounds a week and it very certainly is. And they say, "Oh, well,

but we get some of it back." Yes, but we could spend that money ourselves to good effect and we would obviously look after the farmers and the

universities, for example. And they say there's a rebate. Yes, there is. But of course, the rebate has actually been reduced in recent years. It is

not a fixed point or a given. And it has to be subject to negotiation. As the chancellor of the exchequer made clear before he got into this vote

leave argument.

QUEST: One thing, perhaps maybe because I'm on this side of the -- other side of the Atlantic, to you, is that when you -- but the British people

looking at this will look, hang, on the treasury, the IMF, the OECD, the Bank of England, the IFS, the list of organizations, some of whom you will

say are partisan, but others will be, say they're independent. Who are putting out strong economic reasons against voting to leave. So my simple

question to you, Mr. Redwood, is, why are they all wrong and you're right?

REDWOOD: Well, I see no strong economic reason against wanting to leave. These are, of course, very institutions that recommended and persuaded the

United Kingdom to join the disastrous European exchange rate mechanism, which caused a major recession in Britain and elsewhere. And ended in

catastrophic failure of the whole scheme.

These are the people that recommended the euro and thank heavens I and others managed to persuade the British people to stay out of the euro.

Because the euro scheme is now plunging. Large areas of the continent of Europe into very low growth or recession and into mass unemployment,

especially for young people. And these are the people who failed to spot the obvious that there was going to be a banking crisis given the way they

behaved between 2005 and 2009. And just as they were singularly wrong on all of those three major issues so they are wrong again. Because, of

course, it suits them, particularly it suits the United States of America to try and keep the U.K. in the EU to argue the U.S. case. But we have no

wish to be under the yolk of Brussels and being told what laws we have to impose or what taxes we have to impose. And nor do we wish to send them

lots of money.

(END VIDEOTAPE)

QUEST: John Redwood, the MP talking to me earlier.

Most European markets had modest gains during the course of the day. FTSE is quiet ahead of a long weekend. While we have a long weekend in the U.S.

as well. Lots of places having a long weekend for the summer. Brent crude slip back it tells just 50 on Thursday. Markets are waiting the see

exactly what Janet Yellen said in today's speech. You will hear that in a moment. Best gains of the day, they were the SMI in Zurich. Which had

good numbers from the drug maker, Roche.

The latest polls on the EU referendum suggest that the boat is too close to call. And as Nina Dos Santos now explains, it's an issue that's not only

dividing the nations. It's dividing individual families, too.

(BEGIN VIDEOTAPE)

NINA DOS SANTOS, CNN MONEY EUROPE EDITOR (voice-over): after ten years of marriage, three kids and a growing family business, Ceri and Chad Cryer

have started to have their differences.

CERI CRYER, COFOUNDER BRINKWORTH DAIRY: You will be saying I told you so.

CHAD CRYER, COFOUNDER BRINKWORTH DAIRY: I'm not like that.

SANTOS: Their beef? Not with each other. But over Brussels. Which Chad believes has sown the seeds of unfair competition.

CHAD CRYER: I'm going to be voting out. Because I think the EU favors large business and big business and I don't think that is really the way

farming in this country should be going.

DOS SANTOS: Whilst Kerry credits the EU with access to the larger market and essential funds to upgrading to upgrading their facilities.

[16:15:00] CERI CRYER: I'm going to be voting for Britain to stay in in the referendum. I think farming will do better if we stay in. I think

that there's more support of European governments for farming than there is from the U.K. government.

DOS SANTOS: Across the British Isles agriculture is an emotive issue. About 70 percent of the land mass is dedicated to it. But it's a sector

that only employs about one percent of the work force. And for that one percent, Brussels provides a financial lifeline. For farms like this,

that's equivalent to almost half of their yearly income in the form of subsidies.

The EU may sound like a cash cow, but such subsidies don't go far, especially in the dairy sector. Where a collapse in milk prices have sent

more than half of the UK's dairy farmers out of business since 2000. And to keep the farm going for a fourth generation, the Cryer's had to

diversify into higher margin products like cheese, yogurt and honey. As irony would have it, it was a trip to the European parliament to receive an

award for their prized Wiltshire loaf that left Chad cheesed off.

CHAD CRYER: I went there with an open mind, but I made up my mind while I was there. Our voice in Europe is too divided. We can never vote together

adds a bloc as the French and Germans do and for that reason I think we should renegotiate somehow and the only way to do is to come out.

DOS SANTOS: Whether the UK decides in favor of pastures new or days with the herd, the effects of that decision will live on in the next wave of

Cryer's. What do they make of that? We should stay in Europe or go out? Your mummy's team or daddy's team?

CRYER CHILD: I guess it's whichever is best for farmers.

DOS SANTOS: Nina dos Santos, CNN Money Wiltshire, England, CNN.

(END VIDEOTAPE)

QUEST: Nothing like passing the buck to the youngest generation. CNN has in-depth coverage of the referendum on our website. Including a look at

why Europe might miss the UK if it votes to leave. It's at CNN.com/UKreferendum.

When we return, Janet Yellen says rates will rise when appropriate and she believes appropriate might be sooner than later. But when is appropriate,

appropriate? We'll appropriately talk about it after the break.

(COMMERCIAL BREAK)

QUEST: Janet Yellen hinted on Friday that an interest rate hike in the U.S. in June or July is a real possibility. Now, the Fed chair said it

would probably be appropriate to raise rates in the coming months. And look at the markets. I think you've got the speech they're sort of halfway

through the day and there's a bit of a wobble and then it all comes back. And in fact the speech at 1:30 so you get that precipitous fall just before

2:00. They obviously had a lunch and thought about it. CNN Money Senior Writer, Heather Long is with me. We'll come to the markets in just a

moment. What did the chair actually say? What did Yellen actually say?

HEATHER LONG, CNN MONEY, SENIOR WRITER: She said two important things today. One that she said and that she didn't say. What did she say? She

continued to be very optimistic about the United States economy. She said she sees growth in the economy and that's why she was hinting, giving that

hint, that it would be appropriate to raise rates in the coming months. So, of course, she is never going to pin herself down saying June or July.

That sounds optimistic. She kept hinting the data has been getting better. The economy looks better. So that seems to signal to the market that June

or July is very real responsibility, probably going to happen.

[16:20:00] The other interesting thing, Richard, what she didn't say. Why has the Fed been on hold? Why didn't they move in March? It was all

because of these international effects. What you were just talking about, Brexit, right. Well, she didn't mention the word Brexit today. She didn't

mention China. She didn't mention overseas. So the fact that that's not there is another signal she is not seeing as much noise from abroad.

QUEST: Indeed, the statement, the last statement if I remember, deleted or did not refer as previous ones had from the last meeting to global matters.

LONG: Certainly not --

QUEST: The minutes.

LONG: The minutes were not nearly as strong about overseas. So they still use terms of we're assessing the risks, and again not the specific that is

you saw in March.

QUEST: So, June or July?

LONG: Well, that's a debate I'm having with my colleagues and a lot of experts, too. I think July and that's because -- and that's what the

market thinks, right. So over half of Wall Street thinks it happens in July.

QUEST: What are they doing to receive? I mean, today's the beginning of - - just about at the beginning of June anyway. What's going to arrive between now and then that's data dependent to seal the deal?

LONG: That's right. They get two more big job reports. Next Friday, we get the big read on the labor market. Which has continued to be a huge

strength for the United States. And they'll get another one in July. So they'll have two more months of data to look at. Manufacturing has that

sector come out. Retail sales. Right? Talking about the American consumer the driver of the world. Certainly the U.S. economy. So will get

two more reads on that. The other thing, of course, what you were talking about. Sure, she may not have mentioned Brexit as a key concern today, but

that vote happens eight days after the Fed meeting on June 14th and 15th. That referendum vote and while she doesn't seem as worried about it, it's

certainly a risk and, again, if we wait until July, that's over.

QUEST: Thank you.

LONG: Take care.

QUEST: Have a good weekend.

LONG: You to.

QUEST: Donald Trump's campaign continues to roll through California. Live pictures now taking you to San Diego. There are protesters have gathered

outside the site of Mr. Trump's rally. In the last few moments, the campaign has issued a statement. It says, "The presumptive Republican

nominee," that's Donald Trump, "Will wait to debate whoever wins the Democratic nomination." So, that follows, of course, he'd originally said

he'd debate Bernie Sanders before the California primary. Now, Sanders said, yes. Secretary Clinton said it was never going to happen.

Now it's Donald Trump who has backed off and says it will be inappropriate for him to debate the second place finisher, a tacit if not overt reference

to the fact that clearly Hillary Clinton will be the presumptive nominee for the Democrats. Even though their primary process goes to the

conventions. Mr. Trump says if he's elected president, the U.S. will be completely energy independent. The nominee said America's dependence on

foreign oil was an illness that needs treatment.

(BEGIN VIDEO CLIP)

DONALD TRUMP, U.S. PRESUMPTIVE REPUBLICAN PRESIDENTIAL NOMINEE: America's incredible energy potential remains untapped. It's totally self-inflicted.

It's a wound an it's a wound that we have to heal. Under my presidency, we'll accomplish a complete American energy independence. Complete.

Complete.

(END VIDEO CLIP)

QUEST: About 10 percent of America's energy comes from imports. Number has been declining in recent years. The U.S. imported oil from all these

countries at some point in the last six months. As you see, obviously, sometimes it goes from one country to another country and onwards. Most of

the oil imports or energy imports come from the OPEC nations in the Gulf, and elsewhere. And indeed, from Canada.

CNN's Senior Political Analyst, David Gergen, an adviser to a number of U.S. presidents, joins me now. There's so much to go through. At the

moment, David. Let's just quickly rattle through. Are you surprised that Trump has backed off the half-hearted attempt to debate Bernie Sanders?

DAVID GERGEN, CNN SENIOR POLITICAL ANALYST: I'm a little surprised. You know, it all came up as sort of a casual conversation between a journalist

and Sanders. What do you think? Sanders said, "Yeah, I would love to do that." Of course it's great for Sanders and it's a surprise that Trump

said yes, too. But I must say, a lot of us thought, well this is going to be real showmanship. We're going to have a huge audience. And it would be

an opportunity for Trump to possibly draw off some Sanders supporters later on after the conventions.

[16:25:00] But the fact that he's backed off, I think suggests to many observers is his team not only felt maybe it was inappropriate to debate

number two guy, but maybe they thought he wasn't quite ready to go head to head on a bag national stage with someone when's well versed and has such

incredibly different views than Donald Trump.

QUEST: So now looking forward to the process of California. How damaging would it be to Hillary Clinton if she doesn't take California?

GERGEN: She will still win the nomination but she will be wounded if she does not win California. And as you know, some of the polls suggest that

it is closing. She's had a 6, 7, 8-point lead out there. Some polls suggest it's quite tight. He often rallies right toward the end and last

ten days or so which is exactly where he is now. So there is a chance he'll take it. And to have that the last -- you know, there's also New

Jersey and she'll win New Jersey, but to lose the Golden State. It is a biggest state in the country, would be an embarrassment for her. Not a

huge embarrassment. But it would cause -- deepen the sense that something's not working here the way it should.

QUEST: Back to Donald Trump and this energy speech. I was reading in "The New York Times" and their coverage of it, which, I mean, it's sort of was

snide to sort of -- to rather mealy mouthed. But the point it makes is that Mr. Trump is making claims and making promises that at this point he

can neither know, he can carry out, or are economically feasible to carry out. Such as restoring coal mining jobs in America. What point, David,

does -- do those promises get put to the test and be shown for what they are?

GERGEN: I would imagine that the general campaign, fall campaign, especially in the debates with Hillary Clinton, she is going to make the

points forcefully and will have a lot of support from the press. Which is generally favors her. Mainstream press. And listen. The president --

Trump's speech today sent alarm bells going off in the environmental community. He is saying basically to tear up the Paris Accords on climate

change, reached after hard work. Not binding, legally binding and in effect moral commitments by the various countries. Throw it out the

window. He's going to build the Keystone Pipeline from Canada. That's less controversial. Sharply divided opinion and the climate change stuff

is really quite startling.

QUEST: But here we have a picture, while you're talking -- we're just watching the picture of Donald Trump's 757 Trump plane landing in San

Diego. I mean, look. Isn't the real point about this, Hillary Clinton will have a plane that she's traveling around the country around on, just

out of sheer necessity and convenience. But he's managed to capture something that, frankly, she hasn't.

GERGEN: Absolutely. One can't stress enough if you look at his public policies, they are frightening to so many people that worry about these

things. In the public policy community his speech today on energy is going to rattle the cages again in Europe. But, you know, he has this capacity

to thumb his nose at the elites in such a way as working people are saying, yeah, I'll take some of that. I'm glad to give them the come up pans.

Let's put people back to work and get rid of the crazy things that from test frogs. Let's go build more coal-fired plants. Let's put people back

to work. Let's get rid of all those crazy things that protect frogs. He is tapping into a lot of resentment and anxiety that has built up in the

United States among working people. It's not dissimilar from what you see in much Western Europe. These populist movements we just saw in Austria,

very close vote.

QUEST: Right, but the problem she will face -- and you and I will talk about this again and again. I mean, we come back to the same point in the

general election. Reason does not -- reason and rationale do not Trump, pardon the pun, hyperbole and rhetoric.

GERGEN: I think that's right. But there is, also, this question, Richard. If it were a different candidate on the Democratic side, if it were a

Barack Obama, for example, who was an extraordinarily good campaigner, I don't think Trump could beat him. I think Barack Obama would roll over

Trump. Because he had a magnetism of his own, plus he had this soaring rhetoric that was very good. You have to face the fact that Hillary

Clinton has had a hard time emotionally connecting with voters, and he does that extremely well. But on the other hand, she's the one that has the

rationale policies and he has the policies that sort of bounce off the walls. And, you know, so we're in a -- this is not an easy election for

the United States to sort this out. I'll tell you, Richard, I think there are a fair number of people who are sort of closet Trump supporters.

QUEST: Yes.

[16:30:00] GERGEN: Who will tell the pollsters something else because they -- that's what they think is socially acceptable, but for a variety of

different reasons he's appealing to sort of the -- to this roiling set of resentments built up over a long period of time.

QUEST: Margaret Thatcher's second election victory, everybody said they would vote for Labour and voted for her. She won. Anyway, good to see

you.

GERGEN: Absolutely.

QUEST: David Gergen, joining us.

Now, the international banking system is under attack. This time it's from hackers and another bank identified as a victim. The FBI has launched an

investigation. We'll discuss potential links with North Korea. This is really quite extraordinary. After the break.

(COMMERCIAL BREAK)

QUEST: Hello. I'm Richard Quest. There's more QUEST MEANS BUSINESS in just a moment. One of China's richest men tells me why he's not worried

about Donald Trump becoming president. The FBI is investigating claims that North Korea may be behind the latest major hacks on the Central Bank.

Before all of that, this is CNN and on this network the news always comes first.

President Obama has become the first sitting U.S. president to visit Hiroshima. He gave a speech on the soil where the United States dropped

the first wartime atomic bomb in 1945. The president speaking in front of survivors and dignitaries did not apologize. Instead he called for people

from all countries to reflect on the meaning of the conflict.

(BEGIN VIDEO CLIP)

BARACK OBAMA, U.S. PRESIDENT: Why do we come to this place? To Hiroshima. We come to ponder a terrible force unleashed in a not so distant past. We

come to mourn the dead including over 100,000 Japanese men, women and children. Thousands of Koreans, a dozen Americans held prisoner. Their

souls speak to us. They ask us to look inward, to take stock of who we are. And what we might become.

(END VIDEO CLIP)

[16:35:00] QUEST: Hundreds of women and children have escaped from the city of Falluja as Iraqi soldiers tried to recapture it from ISIS. Falluja

is 65 kilometers from Baghdad, is one of two cities in a rack under ISIS control. The military said it helped around 760 people to get out as the

troops advanced. Local people have been advised to wave white flags over their houses if they're trapped.

One hundred fifteen medical experts have written to the World Health Organization calling for this summer's Olympic games in Rio to be postponed

or moved. An open letter, the doctors say, holding the games as planned could accelerate the spread of the Zika virus. WHO. officials said

there's no public health reason to delay the Olympic games.

Talking of the Olympic games, 23 athletes who competed in the 2012 London Olympics have failed doping re-tests. The athletes are from five different

sports and represented six different countries. The testing focused on possible competitors in the summer's Rio games. The IOC previously caught

31 athletes for illegal doping in the Beijing Olympics in 2008.

CNN has learned that the FBI and federal prosecutors in Los Angeles have opened what's called a national security investigation into the hacking

attack on the Bank of Bangladesh. All this as another bank identified as the victim of a group of hackers known as Lazarus. The target according to

the cyber security firm Semantech, was a bank in the Philippines. So these are all the various people. And the method used was similar to those used

to attack banks Vietnam, Ecuador and Bangladesh. These are all the victims' banks. The same group previously linked to the hacking of Sony

Pictures two years ago.

The U.S. government in various security companies blamed that attack on North Korea. So, these latest banking shenanigans where money is being

stripped out of the global banking system, moved around and then stolen via the Swift transfer system. We've got to ask, is North Korea behind it?

Joining me now to put this in to perspective, give us a bit of thought on this, our cyber security reporter is Jose Pagliery and justice

correspondent Evan Perez. Good to see you both. Evan, first of all, did North Korea do it?

EVAN PEREZ, CNN U.S. JUSTICE CORRESPONDENT: We don't know. The FBI has opened a national security investigation, which is standard, especially if

you believe or there's evidence that there might be a foreign country, hackers working for a foreign government that committed that -- that did

that hack. For example, they did the same when the Sony attack happened. And they have found these signatures.

QUEST: Has the Sony hack been confirmed as North Korea? As best as you can.

PEREZ: The FBI firmly believes it. They think the evidence is strong and they would not -- you know, they -- it takes a long time for them to

attribute an attack and in this case they thought the evidence was incontrovertible.

JOSE PAGLIERY, CNN MONEY CORRESPONDENT: What's new here is that cyber security researchers all over the globe are saying that the same type of

malware, the same tools that hackers used to break into Sony and banks and media companies in South Korea in 2013 has also been seen in this spate of

attacks. And so the thing is that if it's the same hackers using the same tools then it would be North Korea.

PEREZ: But so far, according to the investigation, so far, they have seen only snippets of pieces of the malware and IP addresses that are similar

and were used in the Sony hack, but we don't know whether or not it's the same work.

QUEST: Hang on. Gentlemen, gentlemen, the Sony hack released information. These are the hacks that, you know, did damage.

PAGLIERY: Exactly.

QUEST: But this took money.

PAGLIERY: And lots of it.

QUEST: And lots of it in the tens of millions. We don't know how much from the banks in Ecuador and Vietnam. But this took money. This sounds

more criminal than a hack.

PEREZ: It does. It's not like the things we have known the North Koreans to do. They have done a lot of things, for example they've attacked

corporations in South Korea. But in those cases, it is mostly about nationalism. Mostly to disrupt.

QUEST: OK, on this question of the hacking itself, how many hacks? Why are we talking about hacks? They're not hacks. It's a theft.

[16:40:00] PAGLIERY: This is theft. I keep saying the world we live in today is one in which hackers able to do things that were much more

difficult 10, 20, 30 years ago. This is e equivalent to having a team of people move in to a bank with machine guns and masks and stealing bank

after bank after bank. I mean, $101 million and they did it by emptying a vault electronically.

PEREZ: Right. You don't need a bank robbery anymore.

QUEST: Why am I not seeing a sense of crisis or panic?

PEREZ: I think there is. I think there is a great deal of concern. Not necessarily panic, but I think there's a tremendous amount of concern.

Keep in mind, this is a hack that was not particularly -- has not seen as being particularly sophisticated.

PAGLIERY: Doesn't have to be sophisticated, right?

PEREZ: Right. Could be a simple hack and horrendous. You empty the banks with no or minimal security. In Bangladesh, they found they had almost no

firewall for their networks.

PAGLIERY: But where did they it from? New York Federal Reserve. And so what it really shows --

PEREZ: Right. That's like someone taking over your computer. That's like someone taking over your computer and you're inside, your already signed in

and just using your information to steal --

PAGLIERY: The problem here is banks really is that trust each other too easily.

PEREZ: Right.

QUEST: Hang on a second. I mean, the whole system is designed to -- with what is assumed erroneously to be a level of security so that, for example

--

PAGLIERY: And that security is based on trust and the trust in this instance we find out is --

QUEST: Not pure. Right. Not based on -- based on integrity of systems and what is shown --

PEREZ: Keep in mind.

QUEST: -- Integrity of systems is flawed.

PEREZ: Keep in mind, they're stealing credentials of actual employees so they're inside the system.

QUEST: Now, Swift, which is the organization that manages all of this, says that in the quote of the CEO of this week, it's a big deal and there

will be more of these cases.

PAGLIERY: Right.

PEREZ: And the problem is that the banks are not protecting themselves and they're the weak link in the financial system, especially.

PAGLIERY: Last week, the CEO of MasterCard said in a forum, the meeting of the president's, national cyber security advisors, that he's worried about

the weakest links in the chain, the small banks. Because no matter how much money European and American banks spend to protect themselves, it

doesn't matter if they're intimately connected to smaller banks that don't.

QUEST: Gentlemen, thank you. The question of where is the money and who took it, that's what I'm writing about in the "Profitable Moment" in the

newsletter. Where is the money? The banking system has a crisis. CNNmoney.com/quest is where you will subscribe. Remember, the newsletter,

which has just gone out now, it goes out the moment the markets close or within short order. After New York closes, before Asia opens. It's your

best way of briefing yourself on the day's financial events.

Another call to cancel the summer Olympics over Zika fears. Over 100 prominent doctors say the risk is too great. We'll talk about that in Rio

in just a moment.

(COMMERCIAL BREAK)

[16:45:00] QUEST: The chairman of the Chinese pharmaceutical company, Tiens Group, says he's not concerned about future trade ties between U.S.

and China being disrupted even though Donald Trump says it's all got to change. During a recent trip to Beijing, Li Jinyuan, who has famously

taken thousands of his employees on extravagant vacations told me that the two countries are deeply connected.

(BEGIN VIDEOTAPE)

LI JINYUAN, CHAIRMAN, TIENS GROUP (through translator): I won't worry about it. No matter who will be the president of the United States. It's

called the economy politics. Only the economy politics will get developed in the future. I won't worry about this at all because both China and the

United States are big economic powers. They are tied together. They are inextricably interwoven with each other.

QUEST: Except if the U.S. and a president Trump becomes much more aggressive on the question of trade, the introduction of tariffs, for

example, a much more muscular policy, then you could suffer.

JINYUAN: The important tax increase will not do well to the American economy. He should give it a second thought by then. I think he won't

make decisions without good reason. It's not only about the economy, but also, job opportunities. Entrepreneurship issues will all be affected.

QUEST: But China would have to retaliate.

JINYUAN: As I mentioned before, China and the United States are both economic powers. They rely on each other and need to contribute to the

economy. China's economic development has made huge contributions to the world as well as to the United States.

QUEST: Do you believe that the current trade relationship, the balance if you like, between the two countries on trade, is fair?

JINYUAN: Fairly speaking, the U.S. is still top of the world. But it needs the markets in China. This is the so-called strategic alliance

cooperation. Or simply saying one plus one is greater than two. China and the U.S. need to understand each other. And it is significant to realize

it.

QUEST: Now tell me, sir, how many employees have you just taken on vacation?

JINYUAN: I sent 3,000 employees to Spain this May. Later this September, there will be 10,000 employees traveling to Indonesia and Bali. In total,

there will be 20,000 people attending the conference at Bali.

QUEST: You're taking 20,000 people on holiday to Bali?

JINYUAN: Yes, to Bali and Jakarta. Because it's the 21st anniversary for our company. Also, we are following the national policy one belt, one

road, to do culture exchanges, as well as to boost international peace.

QUEST: How much did the Spanish trip for 3,000 people cost?

JINYUAN: It's around 60 million yen. But the total economic benefit brought to Europe was around 300 million yen. It's a team building

opportunity. The employees made huge contributions to our company. In return, I spent money to do team building. And it is a part of our

corporation culture.

(END VIDEOTAPE)

QUEST: When we come back, we'll be in Rio talking about the Zika virus and whether or not the Olympics should be postponed, canceled, moved. One

hundred fifty doctors think it should be. We'll talk more after the break. QUEST MEANS BUSINESS on a Friday.

(COMMERCIAL BREAK)

[16:51:26] QUEST: A group of doctors want it is Rio Olympics to be postponed because of the Zika virus and says this is summer's games should

not be seen as too big to fail. Ivan Watson is in Rio for us tonight. Ivan, the -- they're not going to get their way even if they're very

eminent doctors and they want the games postponed. It isn't going to happen. The issue is whether or not the games should be postponed. Is

there a real growing health risk, Zika risk, because of the games?

IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: That's exactly what this group of 150 doctors and researchers and health professionals are

saying. There needs to be more research and it would be dangerous to global health, they argue, if you get about half a million foreign tourists

traveling here. And some of them potentially contracting the disease and then traveling out to other parts of the world and potentially bringing the

mosquito-borne virus with them. And they say it's terribly irresponsible for people who might be traveling back to third world countries, developing

countries, that don't have good health care infrastructure that this could be potentially very damaging to those societies.

Now, it's very important to note that both the World Health Organization and the Centers for Disease Control have come out with some health

advisories but saying that the games should go on. The director of the CDC saying just yesterday, Richard, that, "There's no public health reason to

cancel or delays the games," and he also advised though that is not a good idea for pregnant women to travel here and that people that do travel here

should wear mosquito repellant. One of the other warnings from the WHO is actually not to go to poorer neighborhoods of Rio where there's more open

water, more problems with sanitation, and as a result more risk of exposure to mosquitos. So this debate, the health debate, does continue to rage

here.

QUEST: And that's the difficult part, Ivan, for anyone to know where the truth lies. On the one hand, as you rightly point out, the WHO, the IOC,

all the other people say safe to come. The doctors say don't. I suppose if I was going to Rio I would be betwixt and between as to who you believe.

WATSON: I talked to locals here. I talked to city officials and they insist that there are efforts under way to curb the mosquito population

here. You see signs up around the city warning about mosquitos and trying to exterminate them. Also we have been told that this is the winter down

here in the Southern Hemisphere and that there are fewer mosquitos at these times. But there are clearly concerns here. These are concerns for some

of the athletes as well as potentially the tourists.

And sadly, part of a mounting number of challenges to the Rio 2016 Olympics that also includes problems with open sewage. Washing out into the bay

here, where the sailing teams will be exercising. Problems of crime. Members of the Spanish Olympic sailing team were robbed not far from where

I'm standing at gun point just last week. So there are some real concerns in addition to the political and economic crisis that this country is still

reeling with. Add to that Zika and some people here suggest perhaps these Olympic games are cursed.

[16:55:00] QUEST: Ivan Watson in Rio de Janeiro, we'll talk more about that. Thank you, Ivan.

We'll have our Profitable Moment after the break. QUEST MEANS BUSINESS on a Friday.

(COMMERCIAL BREAK)

QUEST: Tonight's Profitable Moment. Very profitable if you're the cyber hackers who have been using the Swift banking system to steal money from

the Central Bank of Bangladesh, Ecuador, Vietnam and the variety of others. We actually don't know how many banks have had their access credentials

compromised. What we can say about all of this is that there's a crisis in the banking sector. Simply because the way I look at it, the fox has got

in to the chicken house and is well and truly making off with all the food. They don't know how it's being done, where the money is going, they don't

know who's behind it. And more to the point they don't know how many more cases there have been around the world.

So you're left saying, what are they going to do about it? The reality is cyber security is the single biggest issue facing any company, any

government, any individual, if you like, at the moment. Whichever way you look at it, one chief executive put it to me like this. The responsibility

of cyber security is non-delegable from the chief executive downwards. And what we're seeing in the banking system is a crisis today.

[17:00:00] And that's QUEST MEANS BUSINESS for tonight. I'm Richard Quest in New York. Whatever you're up to in the hours ahead, I hope it's

profitable. I'll see you in London on Monday.

END