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Infighting Among Lawmakers on Russian Investigation; Kim Jong- Un Reportedly Executes Officials for Lying; Raising Budget for Defense; Prepared to Evict Settlers; A Huge Fine; Risk From Cuddly Stuffed Animals. Aired 3-4a ET

Aired February 28, 2017 - 03:00   ET

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


(COMMERCIAL BREAK)

[03:00:00] ROSEMARY CHURCH, CNN ANCHOR: Infighting on intelligence. Lawmakers disagree on how to proceed with investigating whether Russia helped Donald Trump get into the White House.

Executed for lying. Kim Jong-un reportedly had several security officials killed for making false statements.

And later, explanations and more apologies after the biggest snafu in the history of the Academy Awards.

Hello, and welcome to our viewers all around the world. I'm Rosemary Church, and this is CNN NEWSROOM.

U.S. President Trump Donald Trump is preparing to make the case for how he wants to reshape the nation. He'll give his first speech to a joint session of Congress on Tuesday. Mr. Trump is expected to talk about his proposal to increase defense spending by $54 billion.

He wants to pay for that by cutting funding for most federal agencies.

In the meantime, the White House is trying to stop information leaks. And now President Trump is pointing the finger at his predecessor.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I think that President Obama's behind it, because his people are certainly behind it. And some of the leaks possibly come from that group, you know, some of the leaks which are really very serious leaks, because they're very bad in terms of national security.

But I also understand that's politics. And in terms of him being behind things, that's politics, and it will probably continue.

(END VIDEO CLIP)

CHURCH: And those leaks led to reports that the Trump campaign was in contact with Russians known to U.S. intelligence. Now some are concerned an investigation will not be impartial.

Our chief U.S. security correspondent Jim Sciutto has more from Washington.

JIM SCIUTTO, CNN'S CHIEF NATIONAL SECURITY CORRESPONDENT: On Capitol Hill today, a tale of two realities. The chairman of the house intelligence committee, a republican, denying evidence of communications between Trump advisers and Russians during the campaign.

(BEGIN VIDEO CLIP)

DEVIN NUNES, UNITED STATES HOUSE INTELLIGENCE COMMITTEE CHAIRMAN: As of right now, I don't have, I don't have any evidence that would, of any phone calls. It doesn't mean they don't exist, but I don't have that.

(END VIDEO CLIP)

SCIUTTO: Just hours later, the ranking member of the same committee, a democrat, who has seen much of the same intelligence contradicting that assessment.

(BEGIN VIDEO CLIP)

ADAM SCHIFF, (D) UNITED STATES REPRESENTATIVE: We have, I think, reached no conclusion, nor could we, in terms of issues of collusion, because we haven't called in a single witness or reviewed a single document on that issue as of yet.

(END VIDEO CLIP)

SCIUTTO: At issue, recent reporting from CNN and the New York Times that investigators who are examining communications between trump associates and Russians known to U.S. intelligence. The administration are pushing back hard on the New York Times characterization of the Russians as being part of Russian intelligence.

The bipartisan Hill investigation is just beginning its work. Gathering documents. And agreeing just this afternoon on the scope of the investigation. It is not yet called any witnesses.

Still, Chairman Devin Nunes telling reporters he's already been given indications from unidentified officials in the intelligence community that quote, "there's no there-there."

(BEGIN VIDEO CLIP)

SCIUTTO: Have you eliminated that possibility that the people that Trump advisers were speaking with have connections to the Russian government even if they're not officially working for the Russian government?

NUNES: Well, we haven't, just to be clear, we haven't eliminated anything. The only thing that I want to make sure that we do is before we go after American citizens and subpoena them or bring them before the legislative branch of government that it's not just because they appeared in a news story somewhere.

(END VIDEO CLIP)

SCIUTTO: The Nunes comments echoed by White House spokesman Sean Spicer defending the administration aggressive effort to refute the story.

(BEGIN VIDEO CLIP)

SEAN SPICER, UNITED STATES WHITE HOUSE PRESS SECRETARY: I think Chairman Nunes over and over and over again made it very clear that no evidence has been brought to his attention suggested that reporting was accurate.

(END VIDEO CLIP)

SCIUTTO: Congressman Schiff told reporters however, there is, quote, "a lot of spade work to be done," not only on possible phone calls between Trump advisers and Russians tied to the Kremlin but also other possible links and communications during the campaign.

(BEGIN VIDEO CLIP)

SCHIFF: How the Russians operate, how they seek to exert their influence covertly, whether they do that through third parties, individuals, business people directly, electronically, through encryption, there are a whole host of issues that need to be investigated.

(END VIDEO CLIP)

CHURCH: Our Jim Sciutto reporting there. Well, more now on Trump's -- on President Trump's budget plans. He's looking at big cuts across the government, including the State Department and the Environmental Protection Agency.

(BEGIN VIDEO CLIP)

[03:05:03] MICK MULVANEY, DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET: It's a true America-first budget. It will show the president's keeping his promises and do exactly what he said he would do when he ran for office.

It prioritize rebuilding the military, including restoring our nuclear capabilities, protecting the nation and securing the border. Enforcing the laws currently on the books, taking care of vets and increasing school choice. It does all of that without increase -- without adding to the currently projected FY 2018 deficit.

(END VIDEO CLIP)

CHURCH: The president's plan calls for a 10 percent increase to the military budget, again, that's about $54 billion and that would bring total military spending to $603 billion. To make up for that domestic programs would be cut by $54 billion, with total domestic spending at $462 billion.

Well, more than 120 retired U.S. generals and admirals are urging the Trump administration not to cut funding to the State Department. The letter to congressional leaders reads in part, "The State Department, USAID, Millennium Challenge Corporations, peace corps and other development agencies are critical to preventing conflict and reducing the need to put our men and women in uniform in harm's way."

Well, even the current Defense Secretary James Mattis spoke of the importance of diplomatic funding back in 2013.

(BEGIN VIDEO CLIP)

JAMES MATTIS, UNITED STATES SECRETARY OF DEFENSE: If you don't fund the State Department fully, then I need to buy more ammunition ultimately. So I think the, it's a cost benefit ratio, the more that we put into the State Department's diplomacy, hopefully the less we have to put into a military budget as we deal with the outcome of an apparent American withdrawal from the international scene.

(END VIDEO CLIP)

CHURCH: And the Trump administration is reviewing plans to accelerate the fight against ISIS in Syria and Iraq. The pentagon has sent a number of options to the White House.

CNN learned earlier this month they could include sending U.S. combat forces into northern Syria for the first time. President Trump hopes the big boost in defense spending he's asking for will also help.

(BEGIN VIDEO CLIP)

TRUMP: Win. We have to win. We have to start winning wars again. Let me say when I was young, in high school, in college, everybody used to say, we never lost a war. Now we never win a war. We never win. And we don't fight to win. We don't fight to win. We need to either win or don't fight it at all.

(END VIDEO CLIP)

CHURCH: And for reaction to the president's plans for ISIS, let's go to Amman, Jordan for a live report from CNN's Jomana Karadsheh. So, Jomana, what's being said across the region about new U.S. plans to fight ISIS possibly sending combat forces into northern Syria?

JOMANA KARADSHEH, CNN CORRESPONDENT: Well, I think when it comes to the strategy and the plan, when it comes to the fight against ISIS, the region, it's very much a wait and see. People realize that all options here are on the table literally. So they want to wait and see what comes out of these various proposals when it comes to the fight.

If you look at Jordan, for example, this key U.S. ally that has been a key member of the U.S.-led coalition against the fight, in the fight against ISIS, Jordan has wanted to see a more aggressive U.S. approach to the fight against ISIS in Iraq and Syria.

We've heard officials here also in the past speaking about expanding the fight beyond Iraq and Syria. And this is something we've heard U.S. military officials recently saying that that is one of the options that they would be considering, expanding it, the fight against other extremist groups to expanding it to other countries like Libya, Yemen and Afghanistan.

So when it comes to that, there might be a more welcoming approach to that kind of, when it comes to that possibility, that option. Now when it comes to deploying U.S. combat forces into northern Syria, as we've heard that this is one of the options, there is, there will be concern about that.

If you look at that very complex battlefield, with so many different groups on the ground that are fighting you have so many competing interests, there will be concern that having more U.S. forces you do have Special Forces in an advisory role who are on the ground now.

But to have this sort of combat forces when we're talking about artillery units or anything other than that, there will be that concern that this could even make the situation messier on the ground with U.S. forces there.

And then there's the whole issue of the Syrian Kurds who have been a very reliable ally, a partner for the United States when it comes to the fight against ISIS, how is this new U.S. administration going to deal with this? What part of the plan are they going to play here?

[03:10:00] So that is a question, of course, because of Turkey's objections to U.S. support to these Kurdish groups. So, a lot of wait and see. No option here is straightforward or easy and especially in this very complex and divided region, Rosemary.

CHURCH: Yes, understandably. All right, Jomana Karadsheh bringing us that reaction from Amman, Jordan, it is 10.10 in the morning there. Many thanks.

Well, Iraqi forces fighting ISIS have retaken a key bridge over the Tigris River in western Mosul. They plan to use it to bring in supplies from the eastern half of the city which they recaptured in January.

The government has been trying since October to push the terror group out of its last major stronghold in Iraq. About 750,000 people live in western Mosul. The U.N. says many are afraid to leave their homes.

In the West Bank, Israeli police and security forces are preparing to evict settlers from a number of homes. Hundreds of protesters had surrounded the buildings earlier, even climbing onto rooftops there.

They're furious over a court ruling that found the homes were illegally built on private Palestinian land.

CNN's Oren Liebermann is in Efrat in the West Bank monitoring this situation for us. So Oren, what is happening there right now?

OREN LIEBERMANN, CNN CORRESPONDENT: Rosemary, protesters have started coming out of this house behind me. This is one of the nine homes set to be evacuated. This is one of the first that police surrounded as well as the home right next to us. Take a look, you can see the front door here, there's nobody coming

out at the moment. We've seen the number of people coming out. Here comes one of those protesters walking out. Some have not walked. Some have had to be dragged by police, holding their arms and legs as they've come out.

It's difficult to pick up on the microphone I suspect. But there are more religious protesters inside trying to resist this evacuation and impending demolition any way they can. They are inside singing religious songs. Police are trying to get them to come out peacefully and quite fully.

Some are, some as we've are not, again, having to be dragged out by police. It's difficult to get an estimate on the number of protesters here. But it's been on hundreds, as well hundreds of police here to carry out this evacuation. They moved in right around 9 o'clock this morning, about an hour ago and fairly quickly surrounded some of the homes here and began the evacuation. Rosemary?

CHURCH: And Oren, talk to us about why this is happening at this time. Because it seems to be at odds with announcements of extending and increasing the size and buildings in settlements.

LIEBERMANN: So, those issues are related. This has been through a years' long legal process as was the nearby outpost of Amona which was on the hill was evacuated and demolishes a few weeks ago. This is part of that same legal process. These nine homes are court-ruled were illegally built on private Palestinian land.

And I'll show you again the door as I walk through this explanation. But in response to this, this is obviously something this right wing government doesn't want to see happen. They have almost as a response, as the way of trying to appease the right wing and the religious have announced settlement construction in other places as almost the way of paying back for these evacuations and for these demolitions.

What will happen now? We'll find out. Prime Minister Benjamin Netanyahu has not been clear about any sort of agreement he's reached with President Donald Trump on construction. But there is heavy pressure on Netanyahu to keep building and settlements to keep approving homes.

So it's all related as you can see more protestors this young man walking out as the number of others walking out. But we've seen them pulled out from this house, we've seen them dragged out from the home right next to us, being carried by police.

CHURCH: All right. Our Oren Liebermann with that live report from Efrat from the West Bank. It is 10.13 a.m. where those evictions are underway, and our Oren Liebermann will keep a very close eye on that. Many thanks.

Well, Takata admits to lying about its air bag inflators. Ahead, the hefty fine the company will pay.

Plus, an Indian engineer is shot and killed in Kansas, causing concern among Indian communities in the United States. Reaction from New Delhi coming up.

[03:15:00] (COMMERCIAL BREAK)

DON RIDDELL, CNN WORLD SPORT ANCHOR: Hi. I'm Don Riddell with your CNN World Sport headlines.

On Monday night, it was a new beginning for the defensing Premier League champions Leicester City who you remember fired their manager Claudio Ranieri last week. Leicester was sitting in the relegation zone going into Monday's game against Liverpool.

But the Foxes showed flashes of last season with goals from Jamie Vardy in a 3-1 win. The points gained moved the man of the relegation zone up to 15th for now.

In Medicon (Ph) use less than two years since becoming Germany's World Cup hero by scoring the winning goal in the final, Mario Gotze has been sidelined with an unusual medical condition.

Borussia Dortmund say that the 24-year-old had been suffering from muscular issues after an investigation revealed metabolic disturbances. And so he was rested immediately. It's not clear when he will return. Gotze's told Dortmund official web site quote, "I'm currently undergoing treatment and will do everything in my power to be back in training."

And finally, for the first time since he claimed his 18th Grand Slam title of the Australian Open, Roger Federer is back in action. And a time off seems to have serve him well. He made quick work of the Frenchman Benoit Paire in just 54 minutes, 6-1, 6-3 advancing to the second round to the Dubai tennis championships. Federer is looking to win this for an 8th time.

That is a quick look at your sports headlines. I'm Don Riddell.

CHURCH: Welcome back, everyone. Well, for 15 years, the Japanese company Takata falsified data to hide a deadly defect in its air bag inflators.

On Monday, the company pleaded guilty to a fraud charge in the U.S. and was sentenced to pay $1 billion. The air bags inflator can explode, sending shrapnel into the driver's face and neck.

More than 31 million cars have been recalled worldwide. At least 11 deaths in the U.S. are linked to the air bags, one survivor Stephanie Erdman is a U.S. Air Force lieutenant who testified before Congress.

(BEGIN VIDEO CLIP)

STEPHANIE ERDMAN, INJURED BY TAKATA AIRBAG: There was a metallic foreign object which had punctured and fractured my right nasal bone. And the tip of the shrapnel, and the tip of the shrapnel had embedded in my right sinus.

Since that day, I've endured multiple surgeries and therapies. I have more to go still. My vision will never be the same. I will never be the same.

(END VIDEO CLIP)

CHURCH: A class action lawsuit accuses Ford, Honda, Nissan and Toyota of knowing about the dangerous air bags for years but using them anyway to save money. Honda denied that and the others are yet to comment.

Well, North Korea's leader has ordered the execution of more members of his government. South Korean intelligence reports five security officials were killed after making false reports to Kim Jong-un.

Paula Hancocks is following developments and she joins us now live from Seoul. So, Paula, what all are we learning about the execution of these government officials and the false reports they were apparently accused of making?

PAULA HANCOCKS, CNN CORRESPONDENT: Well, Rosemary, this is information we're receiving from the national intelligence agency here in South Korea through lawmakers. And they said that they believe that at least five deputy ministers within the state security unit of North Korea have been executed.

[03:20:08] They believe that were executed by anti-aircraft guns and they say that this is part of an investigation into the state security chief, Kim Won-hong. He was, according to Saipan (Ph) officials fired last month. The details of this investigation are sparse, though.

We understand from intelligence officials that they believe that false information was given to the North Korean leader, Kim Jong-un, which is what angered him. We believe the state security chief is under house arrest at this point. And the intelligence agency has said that there could be more executions within North Korea as this investigation continues.

It is not an exact science, though, it's worth pointing out that there have been mistakes made in the past with this kind of intelligence, simply because North Korea is such a closed society. Such a closed country. But intelligence officials do believe that at this point at least five have been executed. Rosemary?

CHURCH: And Paula, we have been reporting about the murder of Kim Jong-un's brother in Kuala Lumpur. Now we have the execution of these five security officials. What's going on here? Is there thought to be any possible link at all?

HANCOCKS: There's certainly no link that's been made by the intelligence agency themselves. And it is worth remembering that it was last month that this state security chief was fired. According to South Korean officials.

So that's obviously before this murder of Kim Jong-nam actually took place. It really does show, though, that there are still more elites, more of the high-ranking officials within North Korea that are being executed. There was a report just at the end of last year by one of the think

tanks, a state-run think tank here that said that they believe that Kim Jong-un had ordered the execution of around 340 people since he took power at the end of 2011. And I think about 140 of those were members of the elite.

We've heard high-ranking officials who have defected from North Korea talking about this fear through loyalty. Sorry, this loyalty through fear. This tendency that the North Korean leader has they say to execute a large number of these high-ranking officials. Slightly different from his father and grandfather. Defectors are now saying that there appear to be more executions and less firings. Rosemary?

CHURCH: All right. Paula Hancocks, reporting from Seoul in South Korea where it is 5.22 in the evening. Many thanks.

A man accused of shooting three men, one of them fatally at a bar in Kansas made his first court appearance on Monday. Witnesses say Adam Purinton yelled "get out of my country" at two Indian tech workers before opening fire.

CNN's Ryan Young has the latest.

RYAN YOUNG, CNN NATIONAL CORRESPONDENT: The FBI's assessing whether this man should be charged with a hate crime after allegedly shooting three people in a Kansas City area bar. Adam Purinton appearing in court remotely, charged with one count of first degree murder and two counts of attempted murder.

The 51-year-old appeared calm only briefly talking to a judge, he was unable to afford an attorney. Police say Purinton was arrested after he walked into another restaurant 70 miles away and told the bartender he shot two Iranian people.

The victims were in fact two Indian men who were grabbing a beer after work. Purinton reportedly became agitated at the bar and started taunting them. Witnesses tell CNN he shouted "get out of my country." He was then asked to leave. Purinton did leave but returned later opening fire.

(BEGIN VIDEO CLIP)

IAN GRILLOT, SHOOTING VICTIM: I got under the table when he first started firing.

(END VIDEO CLIP)

YOUNG: Thirty two-year-old Srinivas Kuchibhotla was shot and killed. Alok Madasani was injured along with Ian Grillot who was shot in the arm and chest trying to stop the shooting.

(BEGIN VIDEO CLIP)

GRILLOT: I got up and perceive to chase him down tried to subdue him so that in a way the police could come in and do what they needed to do. (END VIDEO CLIP)

YOUNG: Kuchibhotla, an Indian immigrant worked as an engineer for GPS company Garmin. The incident highlighting concerns about the hostility toward immigrants in the United Sates. A fear echoed by the victim's widow.

(BEGIN VIDEO CLIP)

SUNAYANA DUMALA, SRINIVAS KUCHIBHOTLA'S WIFE: I told him many a times, should we think about going back. Should we think about going to a different country? He said no.

(END VIDEO CLIP)

YOUNG: Indian officials are demanding a thorough and speedy investigation. Kuchibhotla's widow wants to know how she's supposed to comfort his grieving parents.

(BEGIN VIDEO CLIP)

DUMALA: I need an answer from the government. I need an answer from everyone out there.

(END VIDEO CLIP)

YOUNG: The White House has strongly rejected the notion that there might be any connection between the shooting and the Trump administration sharp language about immigration. For Alok Madasani the shooting is troubling, but he still has hope for his community.

(BEGIN VIDEO CLIP)

[03:24:57] ALOK MADASANI, SHOOTING VICTIM: It was rage and malice in an individual's heart that killed my friend, killed our friend. We are to ask all of you for tolerance, or for diversity.

(END VIDEO CLIP)

CHURCH: Ryan young reporting there. We want to go now live to CNN's Ravi Agrawal. He joins us live from New Delhi. So, Ravi, such a shocking murder. How are people reacting across India to this?

RAVI AGRAWAL, CNN INTERNATIONAL'S NEW DELHI BUREAU CHIEF: Rosemary, well, for the family of Srinivas Kuchibhotla, this is all too real. His body arrived in the city of Hyderabad, his home city on Monday night Tuesday today, his body has just been cremated. His extended family was there at the funeral. It was conducted according to Hindu traditions.

When we spoke to family members they express deep sorrow, they're still in shock, they're still processing what's happened and they're remembering Srinivas Kuchibhotla as someone who loved America, who was passionate, who loved his job. He loved his family.

And so, all of that playing out in Hyderabad and at a much more macro level in India, Rosemary, this has been a big story. And the reason is that it resonates for so many Indians. There are so many Indians in America, 166,000 Indian students, many more workers.

This could have happened to any of them if they were at that bar on that day. So there are great fears here in India about this incident, and I should point out as well, that while the White House spokesman, Sean Spicer has said this is a real tragedy, those words have not been matched by the President of the United States Donald Trump.

And when I was speaking to some Indian students here yesterday in New Delhi, they were pointing out, they want more.

CHURCH: All right, Ravi Agrawal, many thanks to you for joining us. I appreciate that.

Well, President Trump Donald Trump is proposing a budget to do more with less. Coming up, how he wants to make the military do more with more.

Plus, Oscar's best picture flub. Find out who's apologizing and who's getting blamed. That's still to come, stay with us.

[03:30:00] (COMMERCIAL BREAK)

CHURCH: And a very warm welcome back. I'm Rosemary Church. I want to update you on the top stories we've been following this hour.

Iraqi forces fighting ISIS have recaptured a key bridge of the Tigris River in western Mosul. That will help give them a supply route from the eastern side of the city which they retook last month. The government has been trying since October to push the terror group out of its last major stronghold in Iraq.

Samsung's de facto chief will face charges including bribery and embezzlement. Jay Y. Lee also known as Lee Jay Yong is expected to be indicted along with four other Samsung executives later Tuesday.

Prosecutors say Lee pledged millions of dollars to influence President Park Geun-hye and win government support for a merger.

Takata will play $1 billion after pleading guilty to a felony charge in the U.S. over its defective air bags. At least 11 deaths in the U.S. are linked to the air bags. More than 31 million cars have been recalled worldwide since 2008.

In the West Bank, Israeli police and security forces are preparing to evict settlers from about eight homes. Hundreds of protesters filled the buildings earlier but some are now leaving or were dragged away.

They're upset about a court ruling that found the homes were illegally built on private Palestinian land. The Israeli Supreme Court ruled the buildings must be demolished by March 5th.

Well, U.S. President Trump is preparing for his first speech to a joint session of Congress on Tuesday and he's expected to call for a major increase in defense spending. Our senior White House correspondent Jim Acosta has more.

JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT: President Trump's message to Washington, get ready for the budget axe.

(BEGIN VIDEO CLIP)

TRUMP: We're going to do more with less. We're going to do more with less and make the government lean and accountable to the people.

(END VIDEO CLIP)

ACOSTA: In a preview of the Trump administration's first budget, White House officials say the president plans to ask for a staggering $54 billion increase in defense spending, offset by massive cuts in non-defense programs, as well as foreign aid. The budget boost for the Pentagon is so big it eclipses what the federal government spends at the State Department and EPA.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: We are taking his words and turning them into policies and dollars.

(END VIDEO CLIP)

ACOSTA: The peak of the president's budget comes as the White House is still grappling with questions about the Trump campaign's contacts with Russia before the election.

Over the weekend, California republican Congressman Darrell Issa, a Trump supporter suggested a special prosecutor may be necessary to put the matter to rest.

(BEGIN VIDEO CLIP)

DARRELL ISSA, (R) UNITED STATES REPRESENTATIVE: You're right, you cannot have somebody, a friend of mine, Jeff Sessions, who was on the campaign and who was an appointee. You're going to need to use the special prosecutor statute.

(END VIDEO CLIP)

ACOSTA: the White House response to that.

(BEGIN VIDEO CLIP)

SPICER: I guess my response would be a special prosecutor for what? How many people have to say that there's nothing there before you realize there's nothing there?

(END VIDEO CLIP)

ACOSTA: Spicer also enlisted the White Hose decision to enlist the two GOP intelligence committee chairman in Congress, as well as the CIA director to talk to reporters about the Russian controversy. (BEGIN VIDEO CLIP)

SPICER: All we sought to do was to actually get an accurate report out.

(END VIDEO CLIP)

ACOSTA: House intelligence Committee Chairman Devin Nunes was careful to say he has yet to see proof of any wrongdoing.

(BEGIN VIDEO CLIP)

NUNES: We still have not seen any evidence of anyone that from the Trump campaign or any other campaign for that matter that's communicated with the Russian government. (END VIDEO CLIP)

ACOSTA: When asked about the prospect of a special prosecutor, the President gave this curious reply. That's odd, considering Mr. Trump just spoke to Russian President Vladimir Putin for an hour a few weeks ago. Not to mention his own trip to Russia in 2013 to promote his Miss Universe pageant there.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Do you have a relationship with Vladimir Putin or conversational relationship or anything that you feel you have sway or influence over his government?

TRUMP: I do have a relationship. And I can tell you that he's very interested in what we're doing here today. He's probably very interested in what you and I are saying today, and I'm sure he's going to be seeing it in some form, but I do have a relationship with him. And I think it's very interesting to see what's happened.

(END VIDEO CLIP)

CHURCH: Our Jim Acosta there mentioned the republican congressman calling for a special prosecutor on Russia. Darrell Issa is making that argument again, saying in a statement, quote, "The American people need a clear-eyed view of the nefarious actions of the Russian government."

[03:35:04] "Right now, we have speculation and assumptions, but not clarity and fact. Any review conducted must have the full confidence of the American people, which is why I recommended an independent review."

And our senior international correspondent Matthew Chance joins us now live from Moscow. So Matthew, what's been the reaction in Moscow to the debate in the U.S. over whether a special prosecutor should be appointed to investigate alleged Russian hacking of U.S. elections and possible links between Trump aides and Russia?

MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, Rosemary, when it comes to all of these issues, the Kremlin and certainly other Russian officials as well have categorically denied that they've got anything to do with any Russian -- any hacking of the U.S. presidential election, any attempt to interfere in the election democratic process in the United States, and have not been engaged in any substantive way with Trump officials or with Trump campaign surrogates in terms of coordination.

And so, they denied all of that. And any attempt to try and say that's the case, Russian officials believe is merely, you know, anti-Russian propaganda with people in the United States who are determined to cast Russia as the enemy.

And so, the latest move towards a congressional inquiry into the links between the Trump administration and Russia are being cast in exactly the same way. I mean, for their part, the Russians have said look, this is just propaganda, it's nothing to do with us.

CHURCH: And Matthew, I did also want to ask you how closely Russia might be monitoring President Trump's first address to Congress Tuesday night. And what would they be looking for?

CHANCE: Well, I think they'll obviously be watching it closely and probably with some consternation as well. Because they've been getting very mixed messages from the United States, from the Trump administration, since it was sworn into office particularly.

I mean, remember, they were expecting a President Trump who had voiced during his campaign very sympathetic views about Russia, who had promised to, for instance, look again at recognizing Crimea as being a legitimate part of Russia, to work with Russia on international terrorism and coordinate operations in Syria and a range of other issues as well.

What they've got is something quite different, faced with the political pressures in the United States, already a couple of his staff members have had to -- have to resign because of their alleged links with Russia.

Faced with that, you know, kind of toxicity of the Russia issue in the United States, we've seen a change of rhetoric from the Trump administration. There's been much, much harder words when it comes to Russia's activity, for instance, in Ukraine.

And so, I think there's some concern now in Russia that what they thought they were going to get is something that's not been delivered. And again, they'll be looking for what Donald Trump has to say about Russia during his speech to Congress.

CHURCH: All right. Our Matthew Chance, bringing us live reaction there from Moscow, where it is nearly 11.40 in the morning. Many thanks.

And still to come here on CNN NEWSROOM, these cuddly stuffed animals could be putting your children's privacy at risk. How it's happening and what you can do.

Plus, the next go-to tourist destination could be the moon. Details on SpaceX's plans to send two ordinary citizens into outer space, that's coming your way in just a moment.

[03:40:00] (COMMERCIAL BREAK)

CHURCH: Well, how about this? Space travel might be the newest frontier for the tourism business. SpaceX founder Elon Musk announced Monday that he will be sending two regular ordinary people to the moon and back at the end of next year.

Musk says they will circle the moon but not land on it in a first attempt at space tourism. The two passengers have already put down significant deposits.

Well, millions of voice messages recorded on stuffed animals may have been captured online and exposed to hackers. That's according to a report by security researcher Troy Hunt. He claims toy company CloudPets kept account information on an insecure database and apparently didn't tell customers that it was compromised. Here's how the toy works.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Staying in touch is easy and fun with CloudPets. Just record a message.

UNIDENTIFIED MALE: Hope you had a good day at school. I miss you.

UNIDENTIFIED FEMALE: And send to the Cloud. In just seconds it floats down to the app on your smart device, allowing you to send a message to the Cloud Pet.

UNIDENTIFIED MALE: I hope you had a good day at school. I miss you.

UNIDENTIFIED FEMALE: It's a message you can hug. Now squeeze puppy's paw to send one back.

UNIDENTIFIED FEMALE: Thanks, daddy, I love you. Thanks, daddy. I love you.

(END VIDEO CLIP)

CHURCH: OK. So you get the idea. And the report found 820,000 accounts, including voice recordings, passwords and photos were exposed. It says the culprit deleted the data and demanded ransom from Cloud Pets to return it, but it seems CloudPets restored the data from a backup.

Cloud Pets parent company Spiral Toys sends in CNN a statement denying that messages or images were compromised.

So let's talk more about this and joining me now is tech security is Bryce Boland. He is the chief technology officer for Asia-Pacific FireEye. Thank you so much for being with us.

So CloudPets parent company as we said, Spiral Toys denies any information was compromised despite security analyst Tony Hunt insisting it was. But how easy would it be for something like this to happen?

BRYCE BOLAND, CHIEF TECHNOLOGY OFFICER, ASIA PACIFIC FIREEYE: Unfortunately, it's very easy for these kinds of breaches to happen today. Now here we have a case of a manufacturer who makes toys and that really have been found to have taken almost no steps whatsoever to protect the information that they were collecting. And this is another example of a manufacturer really failing to meet basic security practices.

CHURCH: So talk to us about what information exactly might have been compromised. We listed some there and of course, passwords, that's critical, isn't it. And how, I mean, if this happened with CloudPets, and they say it didn't, if they failed to inform users of any leak, is this a violation of the law?

BOLAND: Well, in this case potentially what has been exposed is the conversations between children and their parents.

[03:44:58] We also see exposed images that could have been uploaded by the parents using the app as well as the passwords that the parents used when they set up these accounts.

And as we know, people often really use these accounts -- or really use the passwords for other accounts. So potentially other systems would be exposed by this breach.

Of course, in this case if the breach has been found to have happened, then under Californian law, certainly Spiral Toys could be subject to legal action given the top breach that's taken place.

CHURCH: Interesting. So, what can consumers do about situations like this and how do they protect themselves and their children and what advice would you give to any of our viewers watching now who perhaps own some of these toys?

BOLAND: Well, that is probably the most difficult thing about this, there is actually very little that a consumer can really do to protect themselves. Either they accept the risks that come with these devices, or they choose not to use them at all.

Of course, these devices if you do choose to use them, you need to take basic steps to protect yourself and protect your home network. Now for one thing, you should use a separate wireless network for these devices to connect to.

Use a unique password for the accounts that you create. And make sure that if you are using devices that connect to the internet, and to apply any software updates that come from the manufacturer.

CHURCH: What's the worst situation, the worse scenario that could come out of something like this?

BOLAND: Well, this is just once case. And there been many other cases of not just internet connected toys but many internet connected devices being subject to these kinds of breaches. Risk case scenarios include voyeurs having access to look at video

recordings from things like baby monitor and other devices inside your home, have to be used by a variety of criminals in order to steal or to get access to images from your home that you wouldn't want them to have.

We've also seen cases where instant devices can be held at ransom and criminals might try to steal information that way or they've even seen attackers using the access they have on toys to gain access to other systems such as your banking systems or your e-mail or your work accounts. So there is a wide variety of attacks that could take place.

CHURCH: All right. Bryce Boland, a very disturbing details there. I appreciate you bringing us all up-to-date on issues like this. Thanks so much.

BOLAND: You're quite welcome, Rosemary.

CHURCH: Well, there are new details on what's being called the biggest Oscar flub in history. Who is saying sorry and who is taking the blame? That is still to come.

Plus, Serena Williams drops by a public park to play tennis with strangers. And wait until you see their reaction. Back with that in a moment.

[03:50:00] (COMMERCIAL BREAK)

PEDRAM JAVAHERI, CNN METEOROLOGIST: Your final day of February upon us. I'm meteorologist Pedram Javaheri. CNN Weather Watch time right now.

And the perspective across the continents of United States is as interesting as it comes. It affect the winter weather across the inter-mountain west, parts of the western U.S. severe storms around the mid-western U.S. on into areas of the Tennessee Valley and then we're talking well into spring-like temperatures locked in around the Gulf Coast states.

But the highest concern for severe weather places like Little Rock, Arkansas, Memphis, Tennessee, St. Louis, Missouri, that's the concern right there on a scale of one to five or giving at about a three there for risk for severe weather over the next or so 24 hours.

And notice Chicago gets back into the teens. Thunderstorms in the forecast. San Francisco, a beautiful day, finally some dry weather across the western U.S. while Vancouver still getting some rain there at 6 degrees with afternoon rain showers expected.

But again, some snow showers expected. We've seen some heavy snow around parts of the Seattle metro area in the last 24 hours. It is now all displaced off towards the high elevation there as you go east of the city across the i-90 corridor.

How about the cold weather? It's there, it is short lived yet again and it's really exclusive to parts of the northeastern United States into southern Canada. And that is about it across that region.

And notice these temperatures, in Washington, 24. Comes back down to around 7 degrees. A cooling trend certainly to be felt later in the week. And down towards the Caribbean, Kingston around 31 degrees, some morning showers expected.

CHURCH: And welcome back, everyone. Well, the accounting firm that oversees the Oscars votes is apologizing again and says it takes full responsibility for that stunning best picture mix up.

"La La Land" was first announced as the winner, not "Moonlight," on Sunday's live show.

In a statement late Monday, Pricewaterhouse Coopers said an employee accidentally gave the wrong envelope to the presenters and the firm said both accountants in charge of handing out the envelopes should have corrected the mistakes sooner.

The Oscars host, Jimmy Kimmel talked about what happened on his Late Night show earlier.

(BEGIN VIDEO CLIP)

JIMMY KIMMEL, JIMMY KIMMEL LIVE SHOW HOST: "La La Land" was simultaneously somehow the biggest winner and loser last night. Well, the producers of "la La land" were very gracious, which they did not have to be on stage at all.

(APPLAUSE)

They were very nice. It was a very amicable custody arrangement. They didn't ask for visitation or anything.

(END VIDEO CLIP)

CHURCH: CNN's Jeanne Moos has more now on the Oscar mix up that's going down in history.

JEANNE MOOS, CNN CORRESPONDENT: When Warren Beatty...

(BEGIN VIDEO CLIP)

WARREN BEATTY, ACTOR: And the Academy Award...

(END VIDEO CLIP)

MOOS: ... paused for five seconds, it was a giveaway that the Oscar...

(BEGIN VIDEO CLIP)

BEATTY: For best picture.

(END VIDEO CLIP)

MOOS: Would go to the wrong picture. (BEGIN VIDEO CLIP)

FAYE DUNAWAY, ACTRESS: "La La Land."

(END VIDEO CLIP)

MOOS: And as soon as staffer wearing a headset crashed the stage checking the envelope, there was head shaking and mouths gaping.

Meryl Streep didn't even have to act to look like this. Cue the tweets. For instance, we rob Oscars with a steal from Bonnie and Clyde.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: There is a mistake. "Moonlight," you won best picture.

(END VIDEO CLIP)

MOOS: Which got Billy Crystal tweeting "Amazing ending, wish that had happened on Election Day."

Someone else asked "Is there an envelope somewhere that reads Hillary Clinton?" And when "La La Land's" producer held up the correct winner.

JORDAN HOROWITZ, FILM PRODUCER: "Moonlight" the best picture.

(END VIDEO CLIP)

MOOS: The name swapping began featuring everything from Hillary's popular vote tally to the fast-food chain what a burger promoting itself.

One of President Trump's executive orders was re-Christen la-la moon. There were jokes about how Warren Beatty just handed the grenade to Faye Dunaway, how he'd done her in, he knew something was amiss, even looked inside the envelope for another card before letting Faye proclaim.

(BEGIN VIDEO CLIP)

DUNAWAY: "La La Land."

(END VIDEO CLIP)

MOOS: Some invoked Steve Harvey.

(BEGIN VIDEO CLIP)

STEVE HARVEY, COMEDIAN: Please don't hold it against the ladies.

(END VIDEO CLIP)

MOOS: Since he mistakenly named Miss Columbia as Miss Universe and then they had to snatch the crown off her head. (BEGIN VIDEO CLIP)

HARVEY: I can get Warren to this, call me Warren Beatty.

(END VIDEO CLIP)

MOOS: The accounting firm Pricewaterhouse Cooper apologized for the Oscar fiasco saying, "The presenters had mistakenly been given the wrong category envelope."

Right before the faithful mistake was consummated the presenters' eyes met right before.

(BEGIN VIDEO CLIP)

DUNAWAY: It's impossible.

(END VIDEO CLIP)

MOOS: Eerily similar to the last moments of Bonnie and Clyde. No point in shooting the messenger.

Jeanne Moos, CNN, New York.

[03:55:00] CHURCH: Well, the best picture mishap was not the only mistake at the Oscars. During the in memoriam tribute, the wrong photo was shown for Australian costume designer Janet Patterson who passed away in October.

Instead, a photo of another Australian producer Jan Chatman was displayed. Chatman says she's alive and well and that she was devastated her photo was used in place of her friend.

Well, two young guys were playing tennis at a park in San Francisco when all of a sudden Serena Williams walked up and decided she'd surprise them and ask to play the winner. The moment was captured on SnapChat. Take a look.

(BEGIN VIDEO CLIP)

SERENA WILLIAMS, TENNIS PLAYER: Just having a stroll at night and I'm thinking about asking these guys if I can hit just to see their reaction. So I think they are in the middle of playing out points. I'm going to ask them if I can have a winner.

UNIDENTIFIED MALE: Holy crap.

WILLIAMS: On who won?

UNIDENTIFIED MALE: I won two out of three. Wow. Oh, my God.

UNIDENTIFIED MALE: She's serious.

(END VIDEO CLIP)

CHURCH: You can tell they were pretty shocked. Serena didn't have her tennis shoes with her, so she played wearing her boots. She's ranked as the top female tennis player in the world just in case you didn't know and says the moral of the story is you never know when she'll be coming to a tennis court near you. Get ready.

Thanks for watching CNN NEWSROOM. I'm Rosemary Church. Remember to correct with me anytime on Twitter @rosemarycnn. I love to hear from you.

Stay tuned now for more news with our Max Foster in London. Have yourselves a great day.

[04:00:00] (COMMERCIAL BREAK)