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CNN NEWSROOM

Facebook Suspends Data Firm; Trump Launches Attack on Mueller Probe; AT&T and Justice Department Face Off in Court. Aired 9:30-10a ET

Aired March 19, 2018 - 09:30   ET

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


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[09:32:52] JOHN BERMAN, CNN ANCHOR: All right, new this morning, outrage is growing. Lawmakers calling for an investigation into how a data firm with ties to the Trump campaign got its hands on the private information of 50 million Facebook users, maybe even your information.

Joining us now, CNN's senior Washington correspondent Joe Johns.

You know, Joe, there's a lot going on here. Let's see if we can lay it out for people.

JOE JOHNS, CNN SENIOR WASHINGTON CORRESPONDENT: John, we're talking international outrage, especially privacy concerns, and it's all about a data analytics firm that harvested information from Facebook on tens of millions of users which was then utilized in political campaigns, including the trump campaign in the U.S. One of the big questions is whether the firm, Cambridge Analytica, has been up front about how it was using the information because at first it was thought by many to be just research. But one of the founders of Cambridge, who is now spilling the beans in an interview this morning on all of this, says that in 2015 they were in touch with Corey Lewandowski, best known as one of the Trump campaign managers, and that founder of the firm, Christopher Wylie describes how the information was used apparently like a political weapon.

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CHRIS WYLIE, CAMBRIDGE ANALYTICA WHISTLEBLOWER: The fundamental difference between what Cambridge Analytica has done, and standard political messaging, is that when I show you an ad for a candidate, it says, you know, hi, I'm so and so and I approve this message. It is apparent that they are seeing political messaging. It is apparent that they're trying to be convinced.

But what Cambridge Analytica does is works -- works on creating a web of disinformation online so that people start going down the rabbit hole of clicking on blogs, websites, et cetera, that make them think that certain thing are happening that may not be.

(END VIDEO CLIP)

JOHNS: Facebook has suspended the accounts of Chris Wylie and Cambridge Analytica. Trump adviser Steve Bannon was a vice president of Cambridge Analytica, but he has passed the buck so far on questions about it to another employee.

John.

BERMAN: All right, Joe Johns, thanks so much for laying it out. Appreciate it, Joe.

Brian Stelter, you know, CNN's senior media reporter, host of "Reliable Sources," joins me right now.

How is Facebook -- this is as much a Facebook story, by the way, as a Trump campaign or Cambridge Analytica story here. How's Facebook handling this?

[09:35:02] BRIAN STELTER, CNN SENIOR MEDIA CORRESPONDENT: They are trying to clean up another mess -- another mess that happened on this sprawling social network.

You know, John, we talked about fake news, the spread of hoaxes and lies on Facebook before Election Day. Then the story was Russian ads, the propaganda that was being spread by Russian trolling on FaceBook. There were hearings on Capitol Hill about that.

Now it's this issue of the data of tens of millions of users that was apparently mishandled in this case. There's a lot of questions and very few answers. But Facebook says it's going to do an internal review and an external review to find out what went wrong here.

Forgive me for being skeptical. You know, we've seen this time and time again from this company. And also from other big tech companies in Silicon Valley.

BERMAN: Right.

STELTER: It is notable there are some lawmakers speaking out. We can show Senator Amy Klobuchar's comments. She shared this on Twitter over the weekend. She said Mark Zuckerberg needs to testify. She said, this is a major breach. It needs to be investigated. And look what she said at the end there. They always just say, trust us. Mark Zuckerberg needs to testify before the Senate Judiciary Committee.

You know, to date, Facebook has sent its lawyers to Capitol Hill, but never Zuckerberg or Sheryl Sandberg.

BERMAN: And it's interesting, FaceBook's obsessing over the word "breach." They're saying no, no, no, it's not a breach, it's not a breach. Well, that's because actually the data was obtained initially through an allowable way.

STELTER: That's right.

BERMAN: It's just it's no longer available that way.

STELTER: That's right. We all, I think, remember a few years ago those personality quizzes were really popular on FaceBook.

BERMAN: Yes.

STELTER: I did some of them. I think everybody tried them out.

BERMAN: I'm charming (INAUDIBLE).

STELTER: Most of them -- exactly. Totally. Most of them are innocent. Most of them were not being used for nefarious purposes. But this particular personality quiz was being used in a way to gather data. And that's part of the point of FaceBook.

BERMAN: Right.

STELTER: You know, FaceBook's free. If something's free, it means you're the product. It means that you are the product. Advertisers and campaigns are trying to reach you on FaceBook. And a lot of times that's perfectly normal. But you see some of these cases that seem very unusual and that's why you'll wonder, are you going to hear from Zuckerberg? Is Facebook going to own up to these issues? And are there any other lawmakers that are going to demand action? Because, look, it's one thing for a Democratic senator to speak out about this. But we're not seeing calls from other lawmakers to hold Facebook accountable.

BERMAN: Look, I -- you can see it being a bipartisan issue. I imagine sooner or later Zuckerberg will be subpoenaed or will be called to testify on Capitol Hill.

And just back to that breach issue. It doesn't have to be a breach to be a violation of at least your basic right to privacy of your information here, which Facebook hasn't really addressed. As you say, you know, they say they're going to launch an investigation. Thanks.

STELTER: Yes, right.

BERMAN: You know, if you're of the 50 million people whose information is already out there being used in this strange way, thanks.

STELTER: Yes, I think it's about expectations. I think when I use FaceBook, when you use FaceBook, we have a sense that our friends are going to see what we post and maybe strangers can see some of what we post. But it's all kind of unclear. It's all kind of confusing. And maybe that's to the benefit of these social networks to get you to share more and more. I recommend to people at home, go on to FaceBook, look at the privacy checkup feature in the top right-hand corner of the screen. See how much you're actually sharing with the world. You might be sharing a lot more than you think.

BERMAN: You can also talk to your friends on the phone or, God forbid, in person.

STELTER: Wait, I should call you?

BERMAN: That could happen.

STELTER: I'm going to call you from now on.

BERMAN: It could happen. It's been done.

STELTER: OK.

BERMAN: Brian Stelter, thanks so much for being with us. I do appreciate it.

STELTER: Thanks.

BERMAN: A crisis of trust. My next guest says that is exactly what's happening between rank and file FBI agents and FBI headquarters. Why he says there's some major concerns about the behavior of some of the agency's leaders.

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[09:42:26] BERMAN: All right, we've got a new statement this morning from the president of the United States on the special counsel's investigation. This is what the president wrote. A total witch hunt, all caps, with massive conflicts of interest.

This new statement follows a weekend that was chock full of fresh attacks on the Russia probe and the FBI. And, keep in mind, all this rhetoric follow the firing of FBI Deputy Director Andy McCabe.

Joining us now is Steve Moore, CNN law enforcement contributor, retired supervisory special agent at the FBI.

Steve, thanks so much for being with us.

You've been talking to a lot of your former colleagues at the agency right now. What's the mindset right now?

STEVE MOORE, CNN LAW ENFORCEMENT CONTRIBUTOR: I think the mindset is kind of confused and frustrated. There's kind of a division in understanding right here because for years -- for the entire time the FBI's been in existence, FBI agents operated under a certain set of rules. Number one, you would not get -- be political in any way. Agents are afraid to put political signs in their front yard. They're afraid they'll violate the Hatch Act. You will not lie or misrepresent anything to an investigator. And you certainly won't mess with the judiciary in any way.

And now we're seeing what's going on with McCabe. We're seeing the director making political statements during an election. And now Strzok and Page are talking about cultivating a FISA judge. And agents in the field are saying, what the -- what's going on?

BERMAN: Well, just break it down to one point. We were talking about Strzok and Page cultivated a FISA judge. Those exchanges back and forth seemed to be over the fact that Peter Strzok knew the FISA judge. I'm not quite sure they were cultivating. In fact, they were talking about the possibility that their relationship might be grounds for recusal. Ultimately the judge did recuse. And as far as Comey goes, when you say political statement, I know

what you're talking about is the fact that he made that public statement about Hillary Clinton. He made a public statement at all about the investigation. It wasn't a political statement in as if I endorse candidate x or y. But the fact that he made that publicly is usual in your mind. I get that.

The flip side of this is I know you've been talking to agents who see the timing of the firing of Andy McCabe, 26 hours before his retirement, and they're just shaking their heads saying, this seems like it's a lot.

MOORE: Well, yes, and see no agent will tell you that they don't know what shortfall of candor means.

BERMAN: Right.

MOORE: Every agent has it just hammered into their brains from the day one of the academy. However, they are wondering why the hurry to terminate McCabe right before his -- right before his retirement.

[09:45:03] The problem here is that -- is not that OPR and OIG found some -- found that he was misrepresenting things. Every agent will say, yes, that's fireable, he's gone, but the timing of it is really concerning.

BERMAN: Yes. And both things can be true, correct? Both things can be true, that the inspector general and the OPR can find lack of candor, which is a problem within the FBI, but that the timing of the dismissal is suspect. Those both can be true, and I thank you for bringing that up right there.

You talk about the political -- I can't even say the word. You talk about the political nature of this discussion back and forth. James Comey, the former FBI director, now really seems to be in a direct battle with the president of the United States. The former director put out this statement. He says, Mr. President, the American people will hear my story very soon and they can judge for themselves who is honorable and who is not.

Is this something prudent for a former FBI director to say?

MOORE: I -- well, personally, it's -- I don't think he should be -- he should be having a tit for tat with a guy who uses his Twitter that way. But that's -- I can't speak for the other agents.

BERMAN: Right.

MOORE: But what's going on is there is this divide, there is this distrust between the field and headquarters. And right now the agency -- the agents are trying to come to grips with this. But then when an outside source comes in and starts causing problems, it's kind of like a family -- a family fight where you -- where you're at each other's throats until somebody outside the family comes in and jumps into the conversation and you say whoa, whoa, whoa, whoa, we're all in this together. We'll handle our own little issues. And so they probably bristle more than usual when the president comes out and says these things about McCabe.

The agent population isn't thrilled with McCabe --

BERMAN: Right.

MOORE: But they don't like the way things happened with him.

BERMAN: Now to be clear, you're saying the outside force here, who is making the FBI agents, who might be otherwise split, draw together is the president. That people inside do not like the way the president has addressed the agency?

MOORE: Yes. External threat equals group cohesiveness. You know, the best way to get the agents together is to criticize the FBI or the managers, even when the field is pretty upset with management right now as it is.

BERMAN: Steve Moore, interesting perspective. It's a complicated thing. We appreciate you helping us understand it.

MOORE: Thanks.

BERMAN: All right, it is the case that could change the landscape of media and technology really forever. AT&T taking on the Justice Department in what could be one of the most important trials in decades. We'll have the details on this battle, next.

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[09:51:56] BERMAN: This morning, lawyers for the Justice Department and AT&T are facing off in court over the company's $85 billion push to merge with Time Warner. Time Warner owns Turner, the parent company of CNN. I work for CNN.

Corporate America is watching this very closely. The outcome has major impacts on the future of the entire media industry.

CNN's Jessica Schneider outside the district courthouse in Washington with the very latest here.

This is a very important case, Jessica.

JESSICA SCHNEIDER, CNN CORRESPONDENT: It is an important case. A closely watched case, John.

Evidentiary hearings will begin here at the courthouse in just minutes. This trial is scheduled to kick off on Wednesday. And, of course, as you mentioned, companies are going to be closely watching this trial to look to the future of mergers and just how closely the Trump administration may be scrutinizing business deals here. And that's because AT&T-Time Warner merger, it's a proposed $85 billion merger. This is a vertical merger. The government hasn't challenged a vertical merger since the 1970s. And that's because AT&T and Time Warner, they don't directly compete. AT&T distributes video content through DirecTV. It's also the country's largest telecommunications firm. Time Warner, it produces content as -- with Time Warner networks, including, of course, CNN. And so that does makes it a vertical merger. Something the government hasn't challenged in more than 40 years.

Now, AT&T here initially planned to argue potential political bias. That's because of the president's comments that were critical of this merger during the campaign, and, of course, his repeated criticisms of CNN itself. But it turned out in a ruling last month, the judge has not allowed certain evidence in this trial that would have allowed AT&T to make that case. The judge not allowing the Justice Department to come up with certain logs of any potential communication between the White House and the Justice Department.

Now, when it comes to government here, and why it's challenging this proposed merger, the government says the danger here would be that if AT&T owns Time Warner, it might withhold some of Time Warner's content to other distributors and cable companies, or it might charge higher prices. AT&T, on the flip side, says it needs this merger. It needs to acquire Time Warner to get this content, to really be able to compete with other providers that also create content. Providers like Google and Amazon and even FaceBook.

So, of course, this is a face-off that really foreshadows this really changing landscape, this changing media landscape and it could also, John, really foreshadow how closely government will be scrutinizing mergers, whether it's in the media industry or elsewhere.

John.

BERMAN: Jessica Schneider for us, watching this very closely in Washington.

Jessica, thanks very much.

Sources tell CNN that Sweden is negotiating the release of three Americans being held captive in North Korea. North Korea's foreign minister is in Stockholm right now for talks. According to a source, Sweden is not issuing any ultimatums to the North, but is strongly suggesting a release of the prisoners would move things in the right direction. Of course, this comes ahead of President Trump's expected face to face meeting with Kim Jong-un, which the president wants to happen by May.

[09:55:03] A helicopter (INAUDIBLE) was forced to return to Washington (INAUDIBLE) one of its engines failed. This happened last week. The couple was flying to New York for undisclosed reasons. Unclear why they were taking a helicopter. They ended up having to take a commercial flight instead, which also works.

We are following breaking news this morning as some residents in Austin, Texas, have been told to stay in their homes as a new bomb went off overnight. We'll have the very latest.

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[10:00:03] BERMAN: All right, good morning, everyone. I'm John Berman. The president going with brevity this morning in a new attack on the

special counsel's Russia investigation.