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New Probe Launched into Flynn/Russia Ties; Flynn was Warned about Foreign Payments in 2014; Inspector General has Opened Flynn Investigation; Top Oversight Dem wants Flynn Docs Declassified. Aired 10-10:30a ET

Aired April 27, 2017 - 10:00   ET

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

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[10:00:10] ANNOUNCER: This is CNN Breaking News.

POPPY HARLOW, CNN ANCHOR: Top of the hour. Good morning, everyone. I'm Poppy Harlow.

JOHN BERMAN, CNN ANCHOR: And I'm John Berman. We do have breaking news this morning, just in. A news conference, any minute now on Capitol Hill about retired General Michael Flynn, President Trump's very short-lived national security adviser.

HARLOW: As you'll remember, Flynn was forced to resign for misleading the vice president and others about his dealings with Russia. Now, we have word of warnings ignored and a new investigation launched. Our Manu Raju working his sources on the Hill joins us with the latest. This is a huge deal.

MANU RAJU, CNN SENIOR POLITICAL REPORTER: Yes, that's right, three new issues for Michael Flynn as a result of these records that have been released today by the top Democrat on the House Oversight Committee, Elijah Cummings. These three issues confirming foreign payments that he received from sources, as a military officer, he was required to get permission -- a former military officer -- he had to get permission from the Departments of State and the Departments of Army to get those payments. Allegedly, he did not receive permission for those payments, including for a trip that he took to Moscow in 2015 from Kremlin-backed news station "RT," in which he was pictured also in that same trip next to Vladimir Putin.

Now, these three - these three pieces of information that have been released, this 2014 letter from the Pentagon explicitly warning Michael Flynn that he had to get permission. So, it shows that he presumably knew that he had to get permission and apparently, he did not. Because a second newly unclassified letter shows that there is no record within the defense intelligence agency to show that he had any - that there were any reports of any foreign payments for this trip.

And also, the Department of Defense's inspector general announcing earlier this week that he would actually launch an investigation. We're just learning that today of this new inspector general investigation, this coming in light of the announcements from earlier this week that Flynn did not get permission for those foreign payments as well as his failure, allegedly, to not report these payments on a security clearance application, as required by federal law.

So, a lot of new issues for Michael Flynn, the -- full House Oversight Committee expected to review this in a classified setting later this morning. But just moments from now, we do expect to hear from Elijah Cummings, who will address this matter more fully, more problems for Donald Trump's former national security adviser who, of course, was fired because of those contacts that he had with the Russian ambassador, who he also did not properly disclose to the Vice President of the United States.

BERMAN: All right. Manu Raju, why don't you sit down and get ready for this news conference, which is beginning just a few feet from you any second right now. In the meantime, I want to bring in Mark Preston, CNN senior political analyst, also with us, Page Pate, a lawyer who can help us understand exactly what's going on here.

Page, let me start with you on this. We've learned there's a Department of Defense inspector general investigation, there's a certain amount of legal jeopardy in that. And we also learned that General Flynn was warned about accepting payments from foreign nations. What does that mean? What kind of trouble does it put him in in these investigations? Does that get to the question of intent?

PAGE PATE, CNN LEGAL ANALYST AND CONSTITUTIONAL ATTORNEY: I think it absolutely does, John. That is the key question in any criminal prosecution. Did the person who's being investigated intend to violate the law? Was it a knowing violation of the law? And that is especially true when we're talking about a crime like making a false statement. We know now that the failure to disclose this payment or these payments was false. Clearly, the form was not accurate, it was not truthful.

But you have to go a step further. The government would have to show in its investigation that Mr. Flynn knew that he was making a false statement at the time he did it, not just sloppiness or laziness or didn't pay careful attention to the form. But that he intended to mislead the government when he filled out the form. So, I think that's what the inspector general is going to be looking at in this investigation.

HARLOW: Was there an intent, we're not just talking about, according to our Manu Raju, one instance of one speech and one payment. Mark Preston, we're talking about multiple speeches and multiple payments - not only from the Russian government but also from the Turkish government as well.

MARK PRESTON, CNN SENIOR POLITICAL ANALYST: Right.

HARLOW: Where was the White House on this? I mean, you vet everyone carefully, especially your national security adviser and Sean Spicer's response to questions earlier in the week, even before we knew all of this? I don't know what he filled out or what he did or did not do. Is that an acceptable answer? PRESTON: No. I mean, the short answer is no. And we should note for our viewers out there, Michael Flynn, retired General Michael Flynn, also oversaw all the intelligence agencies here in the United States and Barack Obama's administration. So it's not like he didn't know that he had to do this.

[10:05:00] And as Manu just reported earlier, the fact of the matter is, his lawyer, Flynn's lawyer says that he did brief them. So, there is a he said-he said situation going on here right now, but we do know that the White House transition was very chaotic. Mike Pence eventually took it over, but Chris Christie, the governor of New Jersey, oversaw it at the beginning. And we also know that Donald Trump had a very thin, close circle of people that were looking out for his interests. So, the answer is no.

BERMAN: Again, we are waiting for a news conference right now. Elijah Cummings, the ranking member on House Oversight, he will tell us what we just learned, that there is a Department of Defense inspector general investigation into retired General Michael Flynn. Also, again, we learned that General Flynn was warned about taking foreign payments, which he then did, apparently, from "RT" from Russia, also Turkey as part of the deal.

Page Pate, we know that Michael Flynn has offered to testify at various Congressional investigations with immunity. He has said he has a story to tell. His lawyers say he has a story to tell. These committees are not granting immunity at this point right now. With this added investigation from the Pentagon, with this added information, how dangerous does he become from a legal standpoint for this White House? You have a guy getting in more and more trouble. Does that make him more and more likely to try to strike a deal and to perhaps reveal things to investigators?

PAGE: I think that's potentially true. I think Mr. Flynn has been wanting immunity from the beginning because he does have a story to tell and he recognizes. And I'm sure his lawyer recognizes, that once he starts talking, anything that he says, whether it's in a Congressional committee hearing or in the public or to investigators in this new investigation, all of that can later be used against him to show that he intended to mislead the government when he filled out these forms.

So, for him to talk, for him to tell his story, he's going to need immunity. Congress can give it to him or the Justice Department can give it to him, but right now, neither one of those entities has suggested they're going to help Mr. Flynn.

HARLOW: Mark Preston, you know, what's the over-under here for the White House? What is the risk of a non-answer again from Sean Spicer today on this in the press briefing?

PRESTON: I think that Sean in some ways has nothing but to say except not really give an answer because I don't think they have an answer in many ways. I mean, look, there's a strong possibility that they didn't know anything that Michael Flynn was doing and they were very haphazard in looking into his background in vetting him and seeing what interactions he had with foreign governments. And you would think that they would do that, given his role that he took in the administration. But I don't think you're going to see Sean Spicer behind that podium today giving us new details, Poppy, or telling us that the administration -

HARLOW: But this is the -

PRESTON: -- knows what's going on.

HARLOW: This is the extreme vetting president.

PRESTON: Yes, right. He also said, this is the president told us that -- we were going to get so sick of winning, you know, during the campaign. I mean, he says a lot of things, no doubt.

BERMAN: So, Mark Preston, specifically about the distance that this White House is now trying to place between itself and Michael Flynn. It's very, very interesting to see because Sean Spicer saying we don't know what was there, we're not looking right now. This is a precarious position to be in. You know, you can push him away. You can keep on pushing him away. On the other hand, that might make him more dangerous, Mark.

PRESTON: Right. So, politically risky -- and we'll just give both sides of the coin very quickly. If they feel comfortable enough to know that they didn't know anything that he was doing then you're going to see them absolutely push him off the ledge. And in some ways, we've already seen that happen. If they do think that he could get immunity and perhaps say secrets or say things that could implicate the president or others around him, then it does become very precarious, John, no doubt.

HARLOW: Page Pate, walk us through sort of the legal process here. We know there is a new investigation. That's a big headline coming out of the inspector general's office on this, but what then does that lead to for Michael Flynn and when can the public expect some sort of answers from him, if any, on this?

PATE: Well, Poppy, it makes perfect sense that the investigation would start with the office of inspector general, because you know, we're looking at two different things here. One is, did Flynn take money from foreign governments without permission? And that would clearly be a violation of his -- the policies he's supposed to follow as a retired military officer and that's what I think OIG is going to focus on initially. But there's a second issue and that is whether he made a false statement on his forms when he was applying for the security clearance. That is normally an issue that the Department of Justice would look at.

So I think OIG, though, will first consider all of the elements in their investigation, they'll talk to witnesses, they'll talk to people in the White House and this is where I think that's important, because it's going to be hard for everyone in the White House to say, look, we had no idea he filled out this form.

[10:10:04] We had no idea he took this money. When those folks were involved with Mr. Flynn all during that process, it's not just one person who looks at this form. It goes through a number of different people. So, I find it hard to believe that the White House will take the position that we just didn't know and Flynn was acting completely on his own.

BERMAN: All right, guys, stand by. We're going to take a quick break. When we come back, much more on this breaking news, a new investigation into retired General Michael Flynn, the one-time brief- serving national security adviser for President Trump.

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HARLOW: All right. Let's listen to the ranking Democrat on the House Oversight Committee, Elijah Cummings.

REP. ELIJAH CUMMINGS (D), RANKING MEMBER OVERSIGHT COMMITTEE: I will say it over and over and over again, because it is. I want to thank you very much and good morning. I'm pleased to join my colleagues here today and I echo their concerns about the president's first 100 days.

[10:15:00] One of our most serious concerns has been with former national security adviser Michael Flynn, his ties to Russia and his lack of honesty with the American people and even with the Vice President of the United States.

On Tuesday, I joined our chairman on the Oversight Committee, Jason Chaffetz, in viewing classified documents relating to General Flynn that were produced by the Department of Defense. These documents raised grave concerns and I urge all members to view them. I also urge the executive branch to declassify them so that the American public can see them for themselves. While those documents remain under lock and key, I would like to announce today that I am releasing three new documents. I worked with the Pentagon this week to remove and redact classified information and prepare these documents for public release.

First, I'm releasing a letter that was sent directly, directly to General Flynn on October 8th, 2014, from the Office of General Counsel at the Defense Intelligence Agency, his agency. This letter explicitly warned General Flynn, as he entered retirement, that the Constitution prohibited him from accepting any foreign government payments without advanced permission. The Pentagon's warning to General Flynn was bold, italicized and could not have been clearer.

Second, I'm releasing a now-unclassified and redacted version of a letter that the Defense Intelligence Agency originally sent to our committee in classified form on April 7th, 2017. This new DIA letter counters the suggestion made by General Flynn's attorney on Tuesday that General Flynn followed the appropriate procedures when he accepted foreign funds for his trip to Moscow in 2015 and dined with the Russian President Putin. This new DIA letter states -- and let me quote it directly -- "DIA did not locate any records referring or relating to Lieutenant General Flynn's receipt of money from a foreign source," end of quote.

I don't care what his lawyer says, there is no such document saying that he requested permission to get money, to get the money, or a document saying that he received it. It also says this and I quote, "DIA did not locate any records of Lieutenant General Flynn seeking permission or approval for the receipt of money from a foreign source," end of quote. General Flynn's attorneys says he discussed his trip to Moscow with DIA, but we have no evidence, not a shred, that he disclosed his payments, his payments, which is what the emoluments clause is all about, from "RT," the Kremlin-backed propaganda outlet. And we have no evidence, zilch, that he obtained permission from the Secretary of the Army and the Secretary of State to accept any foreign government payments as required by law.

Third and finally, today I'm releasing a letter that we received from the inspector general and the Department of Defense announcing that they, too, are now launching their own investigation of General Flynn. I do not want to take up too much time, so let me conclude with this. Earlier this week, the White House refused, absolutely refused, to produce even a single document, not a single document in response to the bipartisan document request that I sent with our Republican chairman, not one syllable. I watched Sean Spicer make all kinds of excuses, how hard it would be to comply with our request. Come on, man. Look, General Flynn served in his position for 24 days, so that excuse of the White House will not fly. I honestly do not understand why the White House is covering up for Michael Flynn. I don't get it, after the president fired him for lying.

So, the president fired him for lying about his communications with the Russian ambassador. They should be bending over backwards to help us. It does not make any sense and it makes the American people think the White House has something to hide.

[10:20:04] There's obviously a paper trail, ladies and gentlemen. There is a paper trail that the White House does not want our committee to follow, but let it be known that we will follow it. We will follow it with everything we've got. And with that, I'm very pleased to introduce Senator Richard Blumenthal.

SEN. RICHARD BLUMENTHAL (D), CONNECTICUT: Thank you to Representative Cummings for his really profoundly significant historic work and to all of our colleagues for being here today. I think that the swamp image lends itself to mimicry and mockery and I love the reptiles. I love the swamp thing truck. I'm going to use them when I go home this weekend without attribution.

(LAUGHTER)

And by the way, Sheldon, daughters loves trucks, too. I can tell you, with three sons and a daughter. But despite the humor, this subject is really deadly serious because it is -

HARLOW: All right. We are going to continue monitoring this press conference from Democratic Senate and House leadership, but we want to bring in our panel to talk about all of this news from Elijah Cummings, the ranking Democrat on the House Oversight Committee regarding Michael Flynn, the former national security adviser and what he did not, according to this committee, disclose to anyone.

David Chalian is with us, our political director. Our national security correspondent, Jim Sciutto, is here along with Mark Preston, again and Page Pate. And Jim Sciutto, let me just get to you and the reporting you have on this. Three big things, including a new investigation about Flynn and any ties to Russia by the inspector general's office.

JIM SCIUTTO, CNN CHIEF NATIONAL SECURITY CORRESPONDENT: That's right. The confirmation of a DoD investigation of this, but also that Michael Flynn was warned by the Defense Intelligence Agency, which you'll remember he was the director of, in 2014, a year before this visit to Moscow and this paid speech. He was warned that if you do something like that, you have to report a payment from a foreign government.

I mean, this is really shaping up to be a truly egregious nondisclosure here. Because remember, this happened in plain sight. There were pictures of Michael Flynn in Moscow sitting next to the Russian President Vladimir Putin, at this gala, hosted by "RT," "Russia Today." He was there. He knew he did a speech and his story has changed over time, because he said at one point, well, I wasn't paid by the Russians. It came through my speaker's agency -

BERMAN: They're getting questions on this right now. Let's go back to the hearing. We'll come back in just a moment.

SCIUTTO: Sure.

BLUMENTHAL: Just a week after the election, an investigation by "ABC news" revealed that the Trump organization was $364 million in debt to Deutsche Bank, which at the time was under investigation by the Department of Justice. Its role in the 2008 financial crisis and potential wrongdoing in a multibillion-dollar -

BERMAN: Jim Sciutto, sorry for that interruption right there. Please continue with your thought. You were talking about what you called an egregious omission, an egregious lack of coming forward with information about what General Flynn had done.

SCIUTTO: Exactly right and a constantly changing story from retired General Flynn. I was saying, initially he said, well, I wasn't paid by the Russians. It came through my speaking agency. That's just misleading, because the money comes from Russia, even if it's routed through your agent representing you for that speech. But in addition to that, weeks ago, Representative Cummings released documents showing that the Russians said we are grounding this payment through our London office to pay you. So, there was already a paper trail showing exactly where that money was coming.

And now, we are learning in addition to that, that prior to all of this, General Flynn was warned to report exactly these kinds of payments and he didn't do that and that poses legal problems. It poses legal problems. One, because he was in Army, recently retired Army General, but also because he didn't put it on his security clearance form when he took the job as the president's national security adviser. So, he's facing two legal problems there.

BERMAN: And the White House clearly, facing political problems, David Chalian, which you know, Elijah Cummings only too eager to point out. He said literally, I do not understand why the White House is covering up for Michael Flynn. There is a paper trail, he said, that the White House does not want to reveal. This puts enormous pressure on this White House, David.

DAVID CHALIAN, CNN POLITICAL DIRECTOR: Without a doubt and I think he followed up saying to Sean Spicer, "Come on, man." So, I do think the White House -- listen, first of all, the new investigation that we learned about, the IG investigation at the Department of Defense.

[10:25:01] This White House is eager to have some of these investigations wind down, not open up more investigations that are going to linger as a cloud over the administration. So, that's first and foremost, because this just keeps the story out there for them.

But as you're saying, this begs the question. So, Michael Flynn, remember, was fired from the White House, John, because he was not truthful about his conversations with Russians to the vice president, right? That's what we learned and got caught at that. That got exposed. Well, was he truthful with the White House in the vetting process as he was becoming national security adviser about this payment from "RT"? I think that whatever that process, the vetting process of Michael Flynn is now going to get renewed scrutiny and the White House is going to be pressured to provide a clear timeline of what from the campaign, transition, into the position as national security adviser, what exactly they knew about this payment.

HARLOW: So, Mark Preston, as you address this next question, let's show our viewers this, you know, photo that everyone has seen many, many times but has new relevance today and this is Michael Flynn dining next to Vladimir Putin. This was at the "RT," "Russia Today," which is basically a mouthpiece propaganda media outlet for the Kremlin, paid him to be there in Moscow. And these are now events where payments were clearly not cleared at all or approved for Michael Flynn. Mark, talk about why this matters for the American people. Why does it matter for folks at home?

PRESTON: Well, just take a step back and take a little bit of what Jim said and what David said. It was in plain view. It's amazing that Michael Flynn was put into the position that he was put in by the Trump administration given his known ties to Russia or his willingness to work closely with Russia, which I might add is not necessarily a United States ally, where that is clear.

But to what David said about the vetting, best-case scenario is, is that Michael Flynn went rogue, they did not vet him correctly and the White House is going to try to cut him loose. The worst-case scenario for the White House is -- and again, not proven by any stretch of the imagination now -- is that Michael Flynn is seeking immunity. We know that he's seeking immunity and why is he seeking immunity? Page could probably talk a little bit more to this, but you only will be accepted with an immunity request if you can get a bigger fish and then you jump to the next step and was there collusion during the election between higher-level people and the Trump campaign and the Russian government or "WikiLeaks."

BERMAN: All right, you know, the White House has been asked for documents, as David Chalian was suggesting, asked for documents, asked for records pertaining to Michael Flynn during the transition and his days in the White House. Can they be forced, the White House, to release these documents? We're going to put that question to Page Pate. All of you guys stick around right after this break.

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