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Trump's Cabinet Picks Stray from Trump Rhetoric; Unsubstantiated Claims Russia May Have Compromising Personal, Financial Information on Trump; Trump Explains How He'll Separate Business from Presidential Powers; Potentially Explosive Information on Trust as Presidency Inches Closer; DOJ Issues Scathing Report of Chicago Police Department. Aired 1:30-2p ET

Aired January 13, 2017 - 13:30   ET

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

[13:30:00] REP. SETH MOULTON, (D), MASSACHUSETTS: We wanted a chance to do our job. I absolutely support General Mattis. He was my commander back in 2003. He is a warrior scholar, the kind of person we need in that position. But the process here matters. The law matters. And we have to respect the law.

JIM SCIUTTO, CNN ANCHOR: I want to talk to you about another issue that -- listen, this big news week, right? Any of these issues dominating the week.

(CROSSTALK)

SCIUTTO: Trust me, I know, personally.

Donald Trump and his businesses. He had this big press conference. I'm going to do this and that. We've talked to ethics lawyers from both administrations -- we're not talking about Democrats. We're talking about Democrats and Republicans -- at the end of the day, he is still going to be profiting from his businesses, he and his family.

I'll start with you, Congressman Kinzinger.

Has he provided enough separation to make you comfortable that he will not have conflicts of interest as president of the United States?

REP. ADAM KINZINGER, (R), ILLINOIS: It's hard for me to -- look, I'm not the guy that determines what that looks like. It's hard for me to say is there enough of a fire wall. I think what he has to be careful of is even the perception of a conflict of interest because it has a tendency then to undermine decisions he is taking. So, I think he has gone a lot further than what people were fearing back in November that he wasn't even going to recuse himself. And I think, you know, look, it would be very smart of him, and I trust that, ultimately, he will do whatever is necessary to make sure he is not undermining his, in essence, authority as commander-in-chief with a perception of conflict of interest. But in the reality -- look, this business is going to continue to be named Trump. He built a billion-dollar business.

SCIUTTO: He and his family will make money from it.

KINZINGER: It's a family business will make -- it's a family business. You can't expect him to pull the name off the buildings and everything else. But putting a fire wall is important.

SCIUTTO: Are you satisfied?

MOULTON: Absolutely not.

(LAUGHTER)

Trump is a failed businessman. If he had simply put the money his father gave him into the stock market, he would have more money than he does today. He has been -- he has presided over countless bankruptcies, and he is tied to those debts. And unless he separates them from those interests, we're in trouble, because one thing that Donald Trump has proven throughout his history is that he is out for himself.

KINZINGER: You can call Trump a lot, but I think failed businessman -- he is a wealthy guy. And he --

SCIUTTO: Whether failed or successful, the question is, is it right for the highest office in the land to -- to keep, in effect, those businesses while he is leading?

But I know this is going to be a continuing debate.

I want to thank both of you for joining me today.

(CROSSTALK)

SCIUTTO: It's great to be able to talk on so many topics.

Still ahead, the vice president confirmed being briefed on it, the president-elect is still outraged over it, and intelligence officials are trying to get to the bottom of it. Unsubstantiated claims that Russia may have compromising personal and financial information on Donald Trump. We're going to discuss that with Ambassador John Negroponte. He has served many Republican administrations. This is just after the break.

(COMMERCIAL BREAK)

[13:37:01] SCIUTTO: It has been an incredibly hectic week, full of Senate confirmation hearings and Donald Trump's first press conference as president-elect, amid some other news as well. One thing that seems to have been lost in the whirlwind is that, at his press conference, Trump finally explained how he plans to separate, to some extent, his business empire from his presidential powers. He even brought some props.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT-ELECT OF THE UNITED STATES: What I'm going to be doing is my two sons, who are right here, Don and Eric, are going to be running the company. They are going to be running it in a very professional manner. They're not going to discuss it with me.

These papers are just some of the many documents that I've signed turning over complete and total control to my sons.

(END VIDEO CLIP)

SCIUTTO: CNN -- no other reporters -- were allowed to actually open those files or look in them, and there were no markings on the folders to identify what they actually were.

Let's break down Donald Trump's plan with CNN's chief business correspondent, Christine romans.

Christine, help us understand, for the layman out there, exactly what Trump's plan is.

CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: Well, really, Jim, it's a complex set of businesses, right? Overlapping Senate businesses.

Let me give you simple bullet points about what Donald Trump said he was going to do to divest himself from his business. He said his sons will take over the umbrella organization, the Trump Organization. He is going to put his assets in a trust that he won't touch for the next years of his administration. He won't do any new foreign deals with the Trump Organization, and any domestic deals, any new domestic hotel deals, or any kind of licensing deals or any kind of golf course deals. They'll go through an ethics advisor that is in House at the Trump Organization. That's something that people are concerned about there. He is going to receive, he says, overall profit data about his investments, about his stake in the company. But at the end of his tenure, he says if his boys didn't do a good job, he will fire them. He is not selling his business. He is going far short, far short of what past presidents and government and private have said which is putting your business in a blind trust.

The problem is the nature of his business, it has Trump all over it. Right? There are a lot of people who are concerned that Donald Trump and the decisions that he makes will affect his businesses.

Let me just show you quickly how sprawling it is: 564 businesses overall, 144 businesses with ties overseas, 25 countries, 52 different properties.

I want you to listen. There is an Office of Government Ethics, and the guy who runs that Office of Government Ethics was pretty incensed by what went on there and what he thinks is a far, far inferior way of protecting -- you know, protecting the American people from a conflict of interest. Let's listen.

(BEGIN VIDEO CLIP)

WALTER SCHAUB, DIRECTOR, OFFICE OF GOVERNMENT ETHICS: The plan the president has announced doesn't meet the standards that the rest of his nominees are meeting. Every president in the past four decades has met. He is going to be asking our men and women in uniform to risk their lives until conflicts around the world. So, no, I don't think divestiture is too high a price to pay to be president of the United States of America. (END VIDEO CLIP)

[13:40:22] ROMANS: Jim, as you know, says in a lot of countries around the world, the way you curry favor with a government is by doing business with their family. There's a big concern that there will be foreign government that may be trying to stay in his hotels for example, or do business with him to try to curry favor with the American government.

He says that any foreign governments that stay in his properties or his hotels, the profit of that, he is going to write a check to the United States Treasury -- Jim.

SCIUTTO: And we should note, and you know this well, Christine, that loads of government officials going down to very low levels, they don't even sell stocks for the perceived conflicts of interest. A different standard here.

Christine Romans, thanks very much.

ROMANS: You're welcome.

SCIUTTO: "Don't run an improvisational presidency," that's some of the advice being offered by President Obama to his incoming successor. Donald Trump will take the oath of office just behind me one week from today. In an interview with CBS News, President Obama offered his take on some of the challenges ahead for the 40th president of the United States.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I don't think there's anybody who has run a campaign like his successfully in modern history, not that I can think of. And as a consequence, because he didn't have the support of many of the establishment in his own party, because he ran kind of an improvisational campaign --

UNIDENTIFIED NBC NEWS ANCHOR: Can you run an improvisational presidency?

OBAMA: I don't think so.

So now he is in the process of building up an organization, and we will have to see how that works. And it will be a test, I think, for him and the people that he has designated to be able to execute on his vision.

(END VIDEO CLIP)

SCIUTTO: That was President Obama's advice to President-elect Trump.

We'll be right back.

(COMMERCIAL BREAK)

[13:46:13] SCIUTTO: By this time next week, President-elect Trump will be President Trump. But as the days tick down, the amount of potentially explosive information on the future commander-in-chief builds as information about the election hacking further unfolds.

Earlier today, House lawmakers met with top intelligence officials in a closed-door briefing on Russia. This, after Vice President Joe Biden confirmed CNN's reporting earlier this week that the intelligence community briefed him and President Obama on unsubstantiated claims that Russia may have compromising, perhaps even incriminating information on President-elect Donald Trump. We also have CNN reporting that the FBI director himself, James Comey, briefed Donald Trump on this. In it, allegations that there were extensive exchanges of information between the Russians and the Trump campaign in the months leading up to the election.

Today, the transition team confirmed that Trump's choice for national security advisor, retired Lieutenant General Michael Flynn, did exchange both phone calls and texts with the Russian ambassador on December 28th, but only to, they say, exchange holiday wishes as well as coordinate a phone call between Russian President Putin and Trump after the inauguration. This was one day before President Obama announced he was expelling 35 Russian officials in retaliation for election hacking.

I want to discuss this now with my next guest. He is John Negroponte, the former director of National Intelligence. He was also a former U.S. ambassador to Iraq.

Ambassador Negroponte, thank you very much for taking the time.

JOHN NEGROPONTE, FORMER DIRECTOR, NATIONAL INTELLIGENCE & FORMER U.S. AMBASSADOR TO IRAQ: Thank you.

SCIUTTO: Let me ask you this, in your previous roles, you often took classified intelligence briefings. What does it say to you that the intelligence community included these, and I should say unsubstantiated claims, in the briefings to the president and the president-elect? Why would they do that?

NEGROPONTE: I personally am of mixed mind. I can see where you might make the argument to yourself that, gee, this is so explosive that I just got to show it to somebody because, otherwise, I might later on, as things develop, might be accused of having tried to sweep things under the rug. On the other hand, it's a little bit counter to our tradecraft to surface an unsubstantiated report all the way up to the president and president-elect of the United States. So, you could also make the argument that it had no business getting into documents that were put before these high-ranking officials until there was more to it. It's a little bit like saying, well, would you show them everything that was in the "National Enquirer."

SCIUTTO: Right. Let me ask you this, though. This may be a difficult question. The director of National Intelligence, the three other heads of the agencies you briefed -- CIA, NSA, FBI -- they're busy people. They don't have a lot of time. The president, vice president, they're busy people, as is the president-elect. You don't want to waste their time. Does including it indicate to you -- to be clear, director of National Intelligence, James clapper, says, while they have not substantiated, but they have not dismissed this information. Does this indicate to you that they're taking it seriously or how seriously they might be taking this possibility?

NEGROPONTE: Well, it seems to me that in this kind of business of collecting and analyzing intelligence, very often, you get one lead. You get one report. It's unconfirmed. You don't throw it away. You don't ignore it completely. What you do is you put it to one side, and you say, well, OK, let's just watch that one and see if something else comes up. So, I don't think it would be a dereliction of duty to just put it aside and say, well, we'll wait and see if something else comes up. In the meanwhile, maybe it doesn't deserve to be surfaced to the top.

I'm just saying that you could argue this issue both ways, and I don't think what they did tells you anything about the veracity of these allegations.

[13:50:04] SCIUTTO: OK, fair point.

The other story, the Trump transition team confirmed today that Lieutenant General Michael Flynn -- he's, of course, President-elect Trump's pick for national security adviser -- that he was in touch with Russia's ambassador to the United States just three days after Christmas, December 28th. The timing of this is interesting, because it happened around the same time that President Obama was announcing that he was expelling Russian diplomats and some other steps in reaction to Russian meddling in the election. Do you find that timing, that communication at all inappropriate or troubling?

NEGROPONTE: Well, I don't know what the content of the conversation was, but it doesn't strike me as unnatural for a national security adviser-designate to reach out to the Russian ambassador. After all, that's one of the most important relationships we have, where by then, we would have been less than one month to the inauguration, and those are two people who are going to have a relationship going forward. So, no, I didn't find it particularly unusual. And I was very troubled to see somebody suggested that it might be illegal. I think that's patent nonsense.

SCIUTTO: Big picture here, you have both Republicans and Democrats -- I just had two on the air just now -- speaking really in unison, uniformly that Russia is a major threat, that the meddling in the election, while no indication that it affected the results, but still was a serious attack on American democracy. Do you believe -- are you troubled by President-elect Trump, in his public comments, playing down the importance of this election meddling?

NEGROPONTE: Well, I think the team of the president and his -- president-elect and his team are now in the waiting room, if you will, and soon, another week from now, they'll be in the situation room, and I think those are two very different sets of circumstances. And they're going to have to come to the grips with the issue of developing a coordinated, synchronized policies towards each and every one of these issues. Right now, you can see some divergences between them. You can see

some public statements by the cabinet members-designate to the effect that Russia is a through threat, the President-elect Trump kind of dismissing that. There's going to have to be a real harmonization of those points of view. If not, then I think there could be some discord and trouble ahead.

I recall the beginning of the Reagan administration, there were quite a few divergences, and it took them a number of years to sort that out. The sooner the president and his team can develop harmonized, coordinated policies toward these issues, the better it is for them and for the country.

SCIUTTO: Clarity for the country.

NEGROPONTE: Yes, it is.

SCIUTTO: Ambassador John Negroponte, thanks so much for taking the time.

NEGROPONTE: Thanks for the opportunity.

SCIUTTO: The Justice Department has just revealed findings from its year-long investigation into the Chicago Police Department. A scathing report points to what it calls the "rampant use of excessive force and years of civil rights violations." We're going to go live to Chicago right after this break.

(COMMERCIAL BREAK)

[13:57:21] SCIUTTO: Welcome back. Chicago police routinely violated civil rights. They engaged in a pattern of excessive force. A scathing report from the Department of Justice.

Here is Attorney General Loretta Lynch.

(BEGIN VIDEO CLIP)

LORETTA LYNCH, U.S. ATTORNEY GENERAL: The Department of Justice has concluded that there is reasonable cause to believe that the Chicago Police Department engages in a pattern or practice of use of excessive force in violation of the Fourth Amendment to the Constitution.

(END VIDEO CLIP)

SCIUTTO: The investigation was launched after a video was released last year showing the shooting death of Laquan McDonald. Among the report's findings, incidences where officers shot at fleeing suspects who posed no immediate threat, fired at cars without any justification, and used force to retaliate and punish people.

CNN's Ryan Young is in Chicago.

Ryan, what else can you tell us about the report? Really alarming findings here. RYAN YOUNG, CNN CORRESPONDENT: Alarming findings. And I can tell you

that video of Laquan McDonald changed everything when it comes to this city.

Since we've been reporting about this, black and Brown communities in the city of Chicago have constantly been talking about the idea that they would make reports against police officers and nothing would happen from there. And they believed the video and actually seeing that video of Laquan McDonald being shot has changed everything.

And one of the things they talked about today was the idea of adding body cameras to every single patrol officer. That is something that's going to happen before the end of 2018.

But we should highlight something from that Justice Department -- and we'll put this up on the full screen. Talked about how CPD officers would get gang information. They would literally take rival gang members to other areas of the city, and when they did that, they would notify gang members that they were there.

And the mayor talked about making changes. And he said it's something that he desperately wants to have happen for the city.

(BEGIN VIDEO CLIP)

RAHM EMANUEL, (D), CHICAGO MAYOR: But I want to be clear, as the mayor of this city of Chicago, we have a set of values, and when you take an oath of office to serve the public, you uphold those values. That is one city with great diversity but with one city and one future where there is no room for bigotry, hatred or racism.

(END VIDEO CLIP)

YOUNG: Jim, something that we should make clear here is, over and over, we heard the mayor and the attorney general talk about officers giving the bulk of the suggestions here, saying they wanted better training and better equipment so they could do their job better so they could change their perception of the police department.

I should also say they asked a question about Jeff Sessions and how that would change. The mayor said he is dedicated to making this change in the city with the police department -- Jim?

SCIUTTO: These are really alarming findings.

Ryan Young, thanks very much.

That's it for me. I'll be back at 5:00 eastern time for "The Situation Room."

For our international viewers, "Amanpour" is next.

For our viewers in North America, NEWSROOM with my good friend, Brooke Baldwin, starts right now.

[14:00:09] BROOKE BALDWIN, CNN ANCHOR: Jim Sciutto, thank you so much.

Hi, everyone. I'm Brooke Baldwin. Good to be with you on this Friday. This is CNN --