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CNN NEWSROOM

California Wildfires; Australian Arrested, Accused of Being North Korean Agent; ANC Leaders Want Zuma to Go; Russia Investigation; Bitcoin Frenzy Sweeps South Korea. Aired 3-3:30a ET

Aired December 17, 2017 - 03:00   ET

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


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NATALIE ALLEN, CNN ANCHOR (voice-over): Thousands more in California are told to evacuate as the deadly wildfire grows even larger. Ahead this hour, the latest conditions and what firefighters are up against.

Also, lawyers for the Trump transition team accusing special counsel Robert Mueller of unauthorized access to thousands of sensitive emails. But critics say it's all another distraction. We'll look into it.

Welcome to the CNN NEWSROOM. I'm Natalie Allen. We are live in Atlanta. And we begin right now.

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ALLEN: In California, firefighters are battling what is now the third largest wildfire in the state's history. The Thomas fire has raged for almost two weeks, northwest of Los Angeles. It has burned almost 110,000 hectares and has led to the deaths of at least two people.

The fire is only about 40 percent contained; high winds continue to fuel the flames, forcing thousands more, as we mentioned, to flee from Santa Barbara. CNN's Miguel Marquez has more from Santa Barbara.

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MIGUEL MARQUEZ, CNN CORRESPONDENT: This is the fire that just will not quit. I want to show you what's hill just now. We're going to turn the light so you can see. You see the fires burning up in the foothills of Santa Barbara and Montecito.

Firefighters have been working this area for over a week. The winds, they were not cooperating with them at first. They were blowing it toward the ocean. They had those Santa Ana winds blowing the fire along with it. Then they had a let up for a couple days during the week. And they were able to let some burn out to get rid of the undergrowth.

But then the Santa Ana winds came back. Winds are topping out at 20, perhaps 30 miles per hour, though, I will tell you, we were up in those hills earlier. Not even that high and they are very steep. Get whipping 30 to 40 miles per hour in the ravines. No winds whatsoever, right now.

But if they can make it tonight, they believe they will be able to get on top of this Thomas Fire and finally put it out -- Miguel Marquez, CNN, Santa Barbara, California.

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ALLEN: Let's listen to our colleague, John Vause, who spoke earlier about the Thomas fire with Jay Smith. He's a public information officer with CAL FIRE.

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JAY SMITH, CAL FIRE: Right now our biggest concern is that western front of the fire. You know, it's a (INAUDIBLE) populated areas and homes and (INAUDIBLE). So right now that's our biggest concern right now.

VAUSE: We heard earlier that essentially, because of those winds, at 65 mile per hour gusts, at 100 kilometer per hour gusts of wind it made parts of this fire was just unstoppable. And CAL FIRE made the decision, you weren't going to be put men in front of that to try and stop it because their lives would be in jeopardy.

Is that the situation that we have (INAUDIBLE) next couple of days?

SMITH: It is. So we're doing a combination basically of attacks on the fire. So where we can and when we can, we'll put crews going what we call direct, so right on the fire's edge, do a combat with the fire. And when we can't, we'll go indirect.

So we'll have crews and bulldozers cutting hand lines basically off the fire's edge and slowly allowing the fire to consume the fuel up to that fire's edge. But there are definitely times it does seem like it's out of control, yes.

VAUSE: That's a tactical technique known as fire front following when you're essentially allowed to burn through and then try and put out the hot spots once the fire's passed, right?

SMITH: Absolutely. So when we do get those 65 an hour mile winds coming, when that firewall is coming at you, it's like a freight train. So we're not going to put anybody in front of that. So that is one of our tactics, is the fire front following.

So once that fire blows by, then we'll bring the crews in right behind it (INAUDIBLE) hot spots.

VAUSE: Is there one particular reason why the fire has been so unpredictable and so especially dangerous over the last 24-48 hours?

SMITH: Well, (INAUDIBLE) it's a combination of things. So this area that we're in right now, the Santa Barbara-Ventura area, it has a lot of history of fires, pretty big fires. Where this fire is actually burning, there hasn't been a fire in this area in 50-plus years.

So there's a lot of growth, a lot of fuel that feeds this fire on top of Santa Ana conditions. We had red flag warnings now for 12-plus days. It's been over 250 days since this area has had any measurable rain at all. And so it's just that perfect storm for one of these fires.

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ALLEN: Yes, that says a lot. that they won't even try to get the western edge going behind it, Ivan.

IVAN CABRERA, AMS METEOROLOGIST: Just leaving it alone at that point, out of control. It's just amazing. Even by the way, even if it had rained there, this would still be a huge fire. It would still a big deal because the of the winds and the fact that, once they get a handle on part of the fire, it spreads to another area because the winds are propelling those embers and taking them and creating fires downstream from the wind. So this is just going to continue off to be a problem.

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ALLEN: Other news we're following here, a deadly landslide in Southern Chile. Much of a small --

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ALLEN: -- remote village is buried in mud. At least five people were killed. Rescue crews in Villa Santa Lucia are trying to find 15 people who are missing. The area has had unusually heavy rain, more than 11 centimeters fell in just 24 hours. So, California, nothing, and then something like this in some other part of the world.

In other news we are following, Australia's federal police have arrested a man for allegedly brokering illegal exports from North Korea. According to investigators, the 59-year-old suspect was North Korea's economic agent, selling missile components and discussing supplies of mass destruction.

Officials add he will be the first person charged under Australia's Weapons of Mass Destruction Act.

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UNIDENTIFIED MALE: The AP conducted search warrant activity in Eastwood and we subsequently arrested a 59-year-old male person who is appearing before Perimeter Bail Court (ph) very shortly. We allege that male person was living in Australia to conduct illicit trade deals on behalf of North Korea. This is a breach of both United Nations and Australian economic sanctions against North Korea.

Now we'll be looking at this man who is a nationalized Australian, acted as an economic agent of North Korea and conducted prohibited financial activities, such as facilitating exports from North Korea in violation of both domestic and international sanctions.

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ALLEN: South Africa's future hangs in the balance as delegates at the African National Congress face a crucial decision. They're choosing the ruling party's new leader. That person will likely succeed embattled president Jacob Zuma. His government has been mired in corruption scandals. Our David McKenzie reports from the conference in Johannesburg.

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DAVID MCKENZIE, CNN CORRESPONDENT: Embattled president Jacob Zuma opened this critical elective conference in Johannesburg. And despite him facing allegations of corruption, he didn't shoulder responsibility openly.

He in fact put the blame on the loss of support for the ruling ANC on the media, on big business, on the courts and even on those from within his party. But he said he'll let bygones be bygones.

JACOB ZUMA, PRESIDENT, SOUTH AFRICA: Not long time ago, comrades felt I should be talked to, to step down. And I want to say to you all here, comrades, that I bear no grudge. You are my comrades who are expressing your views.

MCKENZIE: Many here, including senior leadership, though, want to see the back of President Zuma.

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TOKYO SEKSALE (PH), FORMER MINISTER: Jacob Zuma is in the departure lounge. He is an outgoing president. His (INAUDIBLE), his baggage is packed there (ph). This, for me, does not affect -- people are trying to find another leader here. I hope it's not just with the oppression of a leader, but leadership. Because the (INAUDIBLE) of finding a leader that becomes a problem.

MCKENZIE: Can the ANC (ph) recover from allegations of corruption?

SEKSALE (PH): It's going to be difficult for the ANC to recover from that. But the ANC should be able, out of this conference, to send a very strong signal, (INAUDIBLE) on members and (INAUDIBLE) in the world that we are ready to deal with this problem.

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MCKENZIE: Around 5,000 delegates will be choosing, over the next few days, the next leader of the ANC. But their choice could be critical for the future of more than 50 million South Africans -- David McKenzie, CNN, Johannesburg.

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ALLEN: And just ahead here, special counsel Robert Mueller again under fire. This time over emails the Trump White House claims he should not have.

Also, when it comes to bitcoin, South Korea is on another level. The virtual currency is so popular there, it has authorities worried.

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ALLEN: Welcome back.

Already tense relations between the U.S. and China could soon get worse. According to the "Financial Times," on Monday, President Trump will label Beijing an adversary engaged in economic aggression against the U.S.

Mr. Trump is frustrated, reportedly, that his personal relationship with Chinese President Xi Jinping has not led to a more balanced trade relationship or significant progress in reining in North Korea.

On the domestic front, the main issue right now in the Russia investigation, thousands of emails from the Trump transition that ended up with special counsel Robert Mueller. A lawyer for the transition complained in two congressional committees that Mueller's team should not have the documents, saying they were handed over to the special counsel without permission.

But Mueller's office says that isn't true, releasing a rare statement a short time ago saying, "When we have obtained e-mails in the course of our ongoing criminal investigation, we have secured either the account owner's consent or appropriate criminal process."

For more on the investigation, here's CNN's Boris Sanchez.

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BORIS SANCHEZ, CNN CORRESPONDENT: This story just adds another layer on what has been a barrage of attacks on the special counsel from Republicans, some Republicans who are making the case that Robert Mueller should resign.

After news broke several days ago that there had been messages exchanged between top FBI officials back in 2016, during the campaign, that were critical of then candidate Donald Trump, Republicans made the case that two -- those two officials that had since been on the special counsel team had tainted the investigation, so to speak.

One of those officials actually left the special counsel before the text messages were revealed. One of them was reassigned shortly after those messages came to light.

But, again, many Republicans are making the case that the messages reveal partisanship within the investigation and they've argued that Robert Mueller should resign.

Democrats, in response, have made the case that the special counsel is not partisan, that it remains politically independent, though they are speculating that the president is now planning to fire Robert Mueller.

Two Democrats, both on the House Intelligence Committee, made the case this weekend that that was the case. First Adam Schiff, who was on Twitter, saying that he believed that the firing of Robert Mueller would happen before the end of the year.

The other, Jackie Speier, also made the case to a San Francisco TV station that Robert Mueller's firing was imminent.

CNN reached out to White House attorney, Ty Cobb, for a statement on these remarks and he gave us a statement, writing, in part, quote, "As the White House has consistently said for months, there is no consideration of firing the special counsel."

So you have the White House denying that there is any kind of plan to remove Robert Mueller as the head of the special counsel; you have some Democrats that are saying that that is the case, that his firing is imminent.

And then you have certain Republicans that are saying that the special counsel is tainted and that Robert Mueller should indeed resign. A complicated situation and one that likely will receive greater focus because, as early as this week, you have a White House legal team meeting with Robert Mueller, one on one, potentially to discuss the next steps in this investigation -- Boris Sanchez, CNN, at the White House.

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ALLEN: Earlier, we spoke about these developments with political analyst Peter Matthews of Cypress College. My colleague, John Vause, asked him if the Trump lawyers had a legitimate complaint.

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PETER MATTHEWS, CYPRESS COLLEGE: I think it's obviously an attempt to discredit Mueller. But they certainly are concerned as well.

But do they have any legal ground to stand on?

But the question is, did Mueller use some kind of procedure to ensure that he was doing things legally by getting information from the GSA?

He must have had some knowledge that he needs to have -- cover himself completely with what he does and to get this information. So maybe he was able to get some type of a search document to be able to get that legally.

I think the Trump team is terrified as to what could happen if this information is already then used in the investigation. And so they're trying to discredit Mueller in any way they can, to say he acted illegally. But someone as experienced as Mueller would not do something as lightly, in my view, so we'll have to wait in the next couple of days and see what's going on here,

JOHN VAUSE, CNN ANCHOR: There is A lot of buzz, a lot of speculation in Washington, the president may decide it's high noon and it's coming soon. Listen to this.

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REP. JACKIE SPEIER (D), CALIFORNIA: The rumor on the Hill when I left yesterday was that the president was going to make a significant speech, at the end of next week on December 22nd, when we are out of D.C. He was going to fire Robert Mueller.

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VAUSE: December 22nd is the Friday; of course, the Monday after that is Christmas. No one's going to be around. There is also talk the president wants to end the various congressional investigations into Russia.

But let's just stick with Robert Mueller, the special counsel.

If Donald Trump does what many people believe he may be planning to do, which is fire him, do we get to the level of a constitutional crisis at that point?

MATTHEWS: Very definitely so because this would even constitute a possible obstruction of justice charge or impeachment because anytime that an outside force, like the president or anyone else, tries to slow down an investigation or to block it and Including firing the chief investigator, as he did with Comey, by the way, there was a huge outcry then.

Can you imagine if he does it the second time against Mueller, who has got his bases covered so well?

This will be a tremendous outcry. And I believe some members of Congress have already said, if he does fire Mueller, that is completely on the road to impeachment immediately. Some members of the House have said that, I believe.

So I think it would be a huge step, John. And something that would be precipitous and I think was one of the worst things that he could do at this point. The best thing that President Trump could do is to leave the investigation alone, let it continue.

And he's not -- if he's not concerned about his acting illegally in any way or his campaign acting illegally or unethically then he should just leave it alone and let the special counsel come to the proper conclusions. That will be the best way to go.

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ALLEN: We'll have more interviews and analysis of this situation coming up on CNN NEWSROOM at the top of the hour. So stay with us for that.

Other news, it has no central bank, no major regulators but bitcoin's popularity and value are now surging as more people worldwide take the risk and buy into the virtual currency. Our Paula Newton reports on how the craze is sweeping South Korea.

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PAULA NEWTON, CNN CORRESPONDENT: I didn't really realize how much ahead of the curve they are here in South Korea when it comes to bitcoin and other virtual currencies. But for a few reasons, it's also beginning to worry the government. Take a listen.

Bitcoin may be a virtual currency. But here in South Korea the kimchi premium is all too real. So, this is kimchi, spicy fermented cabbage, just a staple side dish here.

So what's the kimchi premium?

Bitcoin is in such high demand on Korean one exchanges, traders says South Korean convey a 15 to 25 percent premium on global prices just to get a piece of it.

KIM DUYOUNG, MANAGER, COINPLUG: They see it as gambling in some ways, they try to earn more money by using exchanges.

NEWTON: So to understand the bitcoin frenzy South Korea is as good a place to start a penny. Virtual currencies might be a fringe play elsewhere, in South Korea their mainstream.

At least a million people buy it, trade it, cash it in its everyday banking and investing for everyday people non-more enthusiastic than college students like Isaac Chung.

He's in between classes right now checking his virtual currency portfolio. He's made thousands of dollars already.

ISAAC CHUNG, BITCOIN INVESTOR: It's like the stock market but it's like 10 times, a 100 times faster.

NEWTON: Is it more addictive?

CHUNG: Definitely like the emotions related to this it's more like inflated than like what you get in like a normal stock market because it's on like 24 seven. You have to be constantly on the rate of what's going on.

NEWTON: How popular is it on campus right now.

CHUNG: The speculative frenzy is pretty --

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CHUNG: -- huge right now. The bitcoin price is this right now, the bitcoin prices is that right now. NEWTON: Bitcoin prices they're so excessively tracked here. Bitcoin exchanges like Bitthumb have open storefronts and customer service base to make trading in virtual money much easier.

Three of top 15 virtual currency exchanges are located here and on any given say South Korea accounts for more than one-fifth of all time bitcoin trades done around the world.

The government says it worries that virtual currencies are corrupting the country's use. With so many small investors all in there could be a crash out.

So just like the Kimchi this is made in Korea problem. The government is already working to ban new virtual currencies, ban the sale of bitcoin futures contracts and other derivatives and maybe in future taxing virtual currency transaction and profit.

And there are other uniquely made in Korea problems. South Korean government fears virtual currencies are arming North Korea with new financial weapons making it easier to hack or launder money. And it warns North Korean hackers will aggressively target virtual currency exchanges in the year to come.

All good reasons to keep a keen eye on Korean exchanges as virtual currency goes from market niche to market obsession.

And getting back to that North Korea problem, you know, the issue here is also that they're mining bitcoin and virtual currencies and that's also giving them a leg up when other countries are trying to impose financial sanctions on them.

I want to point out that while we were shooting the kimchi segment in the restaurant that even the manager in the restaurant said he was invested in bitcoin. So when we say it's everywhere, it's everywhere.

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ALLEN: All right, Paula, yes, we get it there. Thanks.

You ever want to be there, say, when a 16-year-old high school student finds out if he got into an Ivy League college?

Well, watch this.

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ALLEN (voice-over): That would be a yes, don't you think? That is the moment Erton Little (ph) from Louisiana was accepted to college and not just any college, Harvard. He was surrounded by friends and family, as you can see, this week when he found out that Harvard accepted his application under the Early Action Program for the class of 2022.

They had a three (INAUDIBLE), three from their school have gotten into Ivy League schools the past three years. He's not the only one in his family jumping for joy. Last week, his brother was accepted to Stanford.

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ALLEN: Not bad.

Thanks for watching. I'm Natalie Allen. I'll be back with our headlines in a moment. But I want to leave you with this, the launch of expedition Suki-4 (ph) happened just about 40 minutes ago. That's the latest crew members headed for the International Space Station, blasting off from Kazakhstan (ph). And off they go.