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CNN NEWSROOM

U.S.-North Korea Summit; Irish Referendum; Harvey Weinstein Charged; Airline Passenger Is Arrested; Russian Oligarch Questioned Over Trump Tower Meeting; Kilauea's Explosive Threat; Facebook Accused Of Violating E.U. Privacy Rules; Amazon Under Fire Over Echo Error. Aired 4-5a ET

Aired May 26, 2018 - 04:00   ET

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


[04:00:00]

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(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Everybody plays games. You know that. You know that better than anybody.

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GEORGE HOWELL, CNN ANCHOR (voice-over): The on-again off-again summit between the U.S. president and leader of North Korea is back on again -- maybe.

Plus this --

(BEGIN VIDEO CLIP)

MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: Mr. Vekselberg, a quick question from CNN, thank you, thank you.

Mr. Vekselberg, why did your company pay hundreds of thousands of dollars to President Trump's lawyer?

(END VIDEO CLIP)

HOWELL (voice-over): CNN confronts the Russian oligarch who met with Trump lawyer Michael Cohen, the man questioned by special counsel Robert Mueller.

Also ahead this hour --

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HOWELL (voice-over): A melee in midair. We'll tell you what led to this confrontation on a flight to Miami and how it ended.

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HOWELL (voice-over): Live from CNN World Headquarters in Atlanta, we want to welcome our viewers here in the United States and all around the world. I'm George Howell, CNN NEWSROOM starts right now.

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HOWELL: At 4:01 on the U.S. East Coast, the peace summit between North Korea and the United States, the one that President Trump canceled Thursday?

Well, it is back on again, at least for now. The Trump administration apparently working on the assumption that a summit with North Korea may happen after all. This about-face a day after the U.S. president sent a letter to Kim Jong-un explicitly canceling their historic meeting in Singapore set for June 12th.

President Trump now saying that both sides are engaged in productive talks that could revive the meeting. Earlier he told reporters he was encouraged by the conciliatory tone coming from North Korea. So it is a definite maybe at best at this point.

It is still unclear though whether the U.S. advance team is headed to Singapore as originally planned.

Our Kaitlan Collins picks it up from here.

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KAITLAN COLLINS, CNN WHITE HOUSE CORRESPONDENT (voice-over): It is the latest case of diplomatic whiplash from President Trump; 24 hours after canceling his highly anticipated sit-down with North Korean leader Kim Jong-un, the president suggesting the summit in Singapore could happen after all.

TRUMP: We will see what happens. It could even be the 12th.

COLLINS: In a stunning reversal, Trump telling reporters today his administration is back in touch with North Korea.

TRUMP: We're talking to them now. They very much want to do it. We'd like to do it.

COLLINS: But his secretary of state, Mike Pompeo, said this the day before:

MIKE POMPEO, U.S. SECRETARY OF STATE: We have received no response to our inquiries from them.

COLLINS: Asked if Pyongyang is playing games, Trump said:

TRUMP: Everybody plays games. You know that.

COLLINS: The developments coming one day after Trump revived talk of military action and vowed to continue economic sanctions.

TRUMP: Our very strong sanctions, by far the strongest sanctions ever imposed and maximum pressure campaign will continue, as it has been continuing. COLLINS: With North Korean officials maintaining they're still willing to sit down with the U.S. at any time, in any format to resolve the problems.

The White House unable to answer if planning staff were still flying to Singapore later tonight, as expected.

SARAH HUCKABEE SANDERS, WHITE HOUSE PRESS SECRETARY: We will see. We have still got a -- a few hours before that takes place. But as I just said, we are going to be prepared if the meeting takes place on June 12, as the president indicated it still could this morning. We will be ready one way or the other.

COLLINS: Officials answering few questions about the summit's future, with only one formal press briefing this week.

TRUMP: Nothing to do with Russia.

COLLINS: And 463 days since President Trump's one and only solo press conference.

QUESTION: Are you going to Singapore, Mr. President?

COLLINS: Now though the day that they canceled the summit, the president and his secretary of state said there had been a breakdown in communications between the United States and North Korea, that seems to have changed, with the president tweeting that we are having very productive talks with North Korea about reinstating the summit, going on to say that he believes it still could happen on June 12th in Singapore but adding, if necessary, it will be extended beyond that date -- Kaitlan Collins, CNN, the White House.

(END VIDEOTAPE)

HOWELL: Kaitlan, thanks for the reporting.

And now live to Seoul, South Korea. CNN correspondent Matt Rivers is standing by following developments there.

Matt, oh, what a difference a day makes, right?

What is the reaction to this reversal from the South Korean perspective?

MATT RIVERS, CNN CORRESPONDENT: Yes, 24-36 hours ago things were very different here in South Korea. There was deep disappointment. It was a major setback, especially for South Korea's current government that had pushed so hard for this summit to take place.

Yet after all of this, what we've heard from the president --

[04:05:00]

RIVERS: -- there is cautious optimism. I'll read you a part of a statement that was sent by a spokesman for the president's office, that person saying it is fortunate that the embers of the North Korea- U.S. dialogue are not going out but are coming back up again. We are watching the development carefully.

And so that is definitely a note there of cautious optimism, George. But it is worth noting that they are not really showing their hands completely there at this point because consider just a couple days ago.

You had the national security adviser here in South Korea saying that he was 99.9 percent sure that the summit was going to happen. And then, well, it didn't.

So there is definitely some thought here in the South Korean government to say maybe we won't be too overly optimistic, even though right now things do appear to be trending towards the summit happening at some point.

HOWELL: We'll just keep up with the ball there, Matt, thank you so much for the reporting.

Let's put this into focus, this ,change of course. Jasper Kim is the director of the Center for Conflict Management joining from Seoul, South Korea, and also from Brussels, Steven Erlanger, "The New York Times" chief diplomatic correspondent in Europe. Good to have you both with us to talk about this.

Steven, I want to start with you.

And Jasper Kim, jump right in after Steven if you would.

But what is your first impression of what is going on here, the off- again on-again approach?

Is this Trumpian theater?

Is it a negotiating tactic, is it reckless, is it innovative, Steven?

STEVEN ERLANGER, "THE NEW YORK TIMES": Well, I think Trumpian theater, hyperbole and negotiation all go together if I can be honest. We haven't really heard much again from North Korea. I'd like to hear what they have to say. I mean Trump clearly feels North Korea needs the sanction relief, wants the summit.

I'm not sure it helps to humiliate Pyongyang this way. But if the summit is back on, the nice thing is it may give the United States a little bit more time to prepare. What worries quite a lot of people is that Trump will rush into a summit, look for something that sounds like success and not be too careful about the details.

That, I think, is a big concern because North Korea is a nuclear country. It is not like Iran developing nuclear weapons. That was the allegation. North Korea has them. It has lots of them. It has missiles. It is a wholly different and dangerous situation.

So let's hope it is back on. One thing you should note is the coin, the famous coin that was minted, didn't have a date. It only said 2018. So we have the whole rest of the year to make that come true.

(LAUGHTER)

HOWELL: The devil in the details, though, as you rightly point out.

Jasper Kim, your thoughts here.

JASPER KIM, CENTER FOR CONFLICT MANAGEMENT: Well, I think this is somewhat to be expected because we have two very unconventional political figures. And both of them actually view the world stage as political theater. And they are both looking to create a narrative.

And from North Korea's perspective, they want to pitch the narrative such that their nuclear state, that is defensively postured, not offensively postured. Whether that is the truth or not, that is what they want to craft.

And on Donald Trump's side, of course, he has the television and media background. He wants to basically exploit that and create an image that he is bringing success to the table. He doesn't want to be perceived as going to the negotiating table out of fear.

He wants to be perceived as having no fear to negotiate. And so I think that is why he retracted a little bit, trying to maximize his bargaining power before stepping in, if he does step back in.

HOWELL: And I want to look at these images, just to show Kim Jong-un, again, these the most recent pictures of Kim Jong-un. And what we're seeing a very relaxed leader of North Korea, wearing the white suit as opposed to the black suit. All of this happening during this reversal coming from the U.S. president.

Jasper, I want to ask you about the North Korean response. It was very measured compared to what we've seen from North Korea in the past.

How important a factor do you think that was in the possibility of these talks being restored?

KIM: Well, I think it is noteworthy, George. And what we have is an ironic twist here with the two political figures. Usually it is the North Korean side that is really aggressive in their tone and this is taken from the Korean language. If you do a direct translation, oftentimes, it is a little bit awkward when it is translated into English.

But here we have North Korea actually striking a conciliatory tone when Donald Trump pulled out of the June 12th Singapore summit originally. And so I think what we have is something very, very interesting.

These two political figures are trying to negotiate and they see a little bit of each other in terms of negotiation style, they recognize it. And even the small things, like Kim Jong-un's suit for example --

[04:10:00]

KIM: -- being white, that could be a very neutral tone, it could be construed as a new era and an olive branch. And we're trying to seek a peace with you, at least that is the nonverbals that I'm picking up from this side here in Seoul.

HOWELL: I mentioned to Matt what a difference a day makes but what a difference a year makes, in fact, looking at where things are now.

Steven, I want to get your take.

Who do you think wants this more?

Is it North Korea, looking to see the possibility of sanctions lifted?

Is it President Trump, who sees this as a legacy moment even worthy of a Nobel Peace Prize?

ERLANGER: Well, it is very hard to say. I think at this time both of them want it. I do think North Korea needs it more. But I also think China is advising him along the way.

The one thing I worry about is the Trump people still keep talking about denuclearization from the beginning. And I really don't believe Kim is prepared to denuclearize. It just would be an act of self-harm from North Korea's point of view.

But its nuclear weapons protected from China as well as the United States. One thing I might look to see if the summit takes place is talk of a peace treaty at long last between North and South Korea, in which Russia and China would have some sort of role as a kind of success before we get to the real nitty-gritty of denuclearization.

Because if we get there, it will have to be staged, it will be very much involved with inspections, with intrusive foreign looks inside North Korea. Very hard for me to imagine there will be a big agreement to denuclearize before economic sanctions are lifted. I think if it is going to happen, it will have to be a long stage-by- stage process.

HOWELL: A lot of serious questions that have yet to be answered. Steven Erlanger, live for us in Brussels and Jasper Kim, live in Seoul, South Korea, gentlemen, thank you for your time and perspective. We'll keep in touch with you.

Live around the world, you're watching CNN NEWSROOM. Still ahead --

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HOWELL (voice-over): -- you could call this proof that alcohol, attitude and altitude don't mix. A bumpy ride from the islands to South Florida.

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HOWELL (voice-over): Plus, he once called the shots in Hollywood. Now he is facing felony charges. The latest in Harvey Weinstein's fall from grace and #MeToo rising. Stay with us.

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HOWELL: Live pictures from Dublin, Ireland. Now you see an historic vote count getting under way on a referendum on whether to overturn some of the strictest abortion laws in the developed world. Early exit polls say that the voters there want to happen and, if it doesn't, it will be a major change for Ireland.

Our Atika Shubert is following all of this from Dublin.

Atika, obviously these results will be clear in the coming hours but tell us more about what you're learning from the exit polls, suggesting that a large number of people are voting for change.

ATIKA SHUBERT, CNN SENIOR INTERNATIONAL CORRESPONDENT: Absolutely. Those ballot boxes just opened 15 minutes ago. We will get the official results in a few hours. But meanwhile, Ireland has already woken up to the exit polls.

RTE, the Irish broadcaster, showing that nearly 70 percent of respondents voted in favor of amending the constitution and liberalizing abortion laws here in Ireland. Only 30 percent against. Those are some decisive numbers. We'll have to see how the official results compare.

The count will actually be tallied here in Dublin Castle and then, of course, we'll get the results shortly afterwards. But it does appear to be an historic day for Ireland. And it is something that a number of people have been looking forward to, campaigners for decades campaigning for abortion rights.

And Ireland's prime minister last night putting out a tweet, thanking everybody for voting and saying it does look to be that history will be made today -- George.

HOWELL: Again, if this does happen, it would be major change. But help our viewers understand the legacy behind this issue in Ireland. Given the deep roots of the Catholic Church there, again, this would be a major shift in opinion.

SHUBERT: Absolutely. It is a seismic shift. Ireland has had some of the strictest laws on abortion in Europe, in the Western world. And in 1983, actually another referendum voted into the constitution, the eighth amendment, which said that the rights of the unborn are equal to the rights of the mother.

And that is what really was the legal basis for banning abortion this Ireland. So this vote, if the official results mirror what we see in the exit polls, would completely reverse that. And one of the most amazing things to come out of the debate on this

is the number of stories that women have been coming forward, to tell about often these deeply and emotional and traumatic stories about how they have had to seek abortions to terminate pregnancies.

We spoke to young women, teenagers who felt alone and isolated who had to travel abroad for terminations but also to older mothers, who -- one woman who we spoke to who had, very sadly, a fatal fetal abnormality and had to terminate the pregnancy. And the sort of heartwrenching stories that came out that were in the public debate here.

And I think that really showed the big societal shift that we saw happening in Ireland, not just in the debate running up to this but that has been going on for several decades now.

HOWELL: And again, the results will be more clear in the coming hours But from what we're understanding, Atika, people are voting for a big change there. Live in Dublin, Ireland, thank you so much for your time. We'll stay in touch with you.

The disgraced Hollywood producer Harvey Weinstein is out on bail.

[04:20:00]

HOWELL: This after being charged with rape and criminal sexual acts. Weinstein has repeatedly denied any allegations of nonconsensual sex. But the arraignment Friday was a victory for more than 80 women who've accused him of sexual harassment or assault over several decades. Our Brynn Gingras has more.

(BEGIN VIDEOTAPE)

BRYNN GINGRAS, CNN CORRESPONDENT (voice-over): Hollywood megaproducer Harvey Weinstein in handcuffs, walking into court today, facing rape charges. They stem from the accounts of two women, including an aspiring actress, who first spoke out in a 2017 "New Yorker" article, alleging Weinstein forced her to perform oral sex on him at his office in 2004.

Tonight, Weinstein is out of jail after posting a $1 million cash bail but not before surrendering his passport, being forced to wear a monitoring device 24/7 and traveling only between New York and Connecticut.

The criminal charges are the first to be filed against Weinstein after dozens of women including, several A-list actresses, made various sexual misconduct accusations against the media mogul last year, among them, Gwyneth Paltrow...

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GWYNETH PALTROW, ACTOR: We had one instance in a hotel room, where he tried to -- where he made a pass at me. And then I really kind of stood up to him.

GINGRAS (voice-over): -- Angelina Jolie, Salma Hayek, Lupita Nyong'o, Ashley Judd...

ASHLEY JUDD, ACTOR: I fought with this volley of nos, which he ignored.

GINGRAS (voice-over): -- and actress Rose McGowan, one of the first women to publicly accuse Weinstein of rape.

ROSE MCGOWAN, ACTOR: We got you. Yes.

(APPLAUSE)

MCGOWAN: To see him in cuffs on the way out, whether he smiled or not, that is a very good feeling.

GINGRAS (voice-over): Weinstein denies having nonconsensual sex with any of his accusers and his attorney insisted today, his client is innocent.

UNIDENTIFIED MALE: My job is not to defend behavior. My job is to defend something that is criminal behavior. Bad behavior, Mr. Weinstein did not invent the casting couch in Hollywood. And to the extent that there is bad behavior in that industry, that is not what this is about.

(VIDEO CLIP, "SILVER LININGS PLAYBOOK")

GINGRAS (voice-over): It is a stunning fall for the man behind several major movies, like "Silver Linings Playbook," "The King's Speech" and "Shakespeare in Love," just to name a few, some of which earned Weinstein dozens of awards for his work behind the camera.

But now he is the focus of investigations for alleged sex crimes, not just in New York but also in Los Angeles and London -- Brynn Gingras, CNN, New York.

(END VIDEOTAPE)

HOWELL: Brynn, thank you for the reporting.

The next time you fly and perhaps you've had one too many, remember this. The law prohibits the airline from serving an intoxicated passenger. That was apparently what started a bit of a mixup on board American Airlines, a flight from St. Croix to Miami on Wednesday.

The video is a bit hard to hear but we'll take you through what happened when passenger Jason Felix wanted another drink.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: (INAUDIBLE). We'll be there in an hour.

Why are you upset?

(INAUDIBLE).

HOWELL (voice-over): Got to remember, everybody has got a camera. People capture this. It doesn't take long for Felix to get more animated, still demanding the flight attendant get him another drink and even taking jabs at the flight attendant.

And it didn't end there. Punches flew. Other passengers jumped in to try to calm the man down. According to a criminal complaint, Felix spit blood at one of them, even threatened to kill them.

After this, the captain turned on the seat belt sign, he instructed everyone to return to their seats. Eventually passengers were able to calm Felix down a bit, although he was still agitated, talking loudly, punching the overhead bins.

When the plane landed in Miami, four officers from Miami-Dade Police went on board and, after a bit of friendly convincing there, Felix got off the plane and was handed over to the FBI. He was arrested for interfering with a member of the flight crew. Felix now has a reservation before a judge, set for Tuesday.

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HOWELL: You're watching CNN NEWSROOM. Still ahead, CNN goes in search of answers from a Russian oligarch about a meeting with Donald Trump's attorney.

(BEGIN VIDEO CLIP)

VEKSELBERG: Just later, OK?

[04:25:00]

VEKSELBERG: Really appreciate -- I understand. I understand. You, you are so aggressive. Please leave. Please leave.

(END VIDEO CLIP)

HOWELL: Our Matthew Chance there, asking the tough questions. Ahead, how he figures into the investigation of Russian interference in the U.S. election.

Plus, some Hawaiian streets turn into a volcanic wasteland. These live images from Pahoa, Hawaii, images of the volcano you see there. The latest on the erupting volcano there ahead as NEWSROOM continues.

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HOWELL: Welcome back to the viewers here in the United States and all around the world. You are watching CNN NEWSROOM. I'm George Howell.

[04:30:00]

HOWELL: CNN has learned the U.S. president's personal attorney Michael Cohen met with a Russian oligarch just days before Mr. Trump's inauguration in January 2017. Video footage shows that oligarch, who was recently sanctioned by the U.S., arriving at Trump Tower during the transition period.

In this exclusive report, Matthew Chance tracked down the Russian billionaire.

(BEGIN VIDEOTAPE)

CHANCE: Mr. Vekselberg, a quick question from CNN.

VEKSELBERG: No, thank you, not now.

CHANCE: Mr. Vekselberg, Why did your company pay hundreds of thousands of dollars to President Trump's lawyer?

VEKSELBERG: Not now.

CHANCE (voice-over): He is yet another media-shy Russian billionaire linked with the Kremlin and mired in allegations of collusion with the Trump team. The FBI questioned Victor Vekselberg about payments to Trump attorney Michael Cohen by his company's U.S. affiliate. They say it was for consulting work. We asked about the payments, too.

VEKSELBERG: Really appreciate. Just later, OK?

Really appreciate. I understand. I understand. But you are so aggressive.

CHANCE: No, I'm not.

VEKSELBERG: Please wait. Please later.

CHANCE (voice-over): We now know that Vekselberg met Cohen even before President Trump was inaugurated. These recently unearthed January 2017 images from the lobby of Trump Tower in New York show the Russian billionaire wearing a hat and coat, checking in at the security desk, lingering for several minutes and then entering an elevator with his business partner.

Cohen hasn't responded for comment but a person familiar with the meeting tells CNN that the two went up to Cohen's office on the 26th floor, although they did not meet the then president-elect himself. They left the building just 27 minutes later.

A person familiar with the meeting told CNN that Vekselberg and Cohen discussed improving U.S.-Russia relations. But what exactly this now sanctioned Russian billionaire expected remains unclear -- Matthew Chance, CNN, St. Petersburg, Russia.

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HOWELL: Matthew, thanks for the reporting.

Let's talk about the situation from people who live near Hawaii's erupting Kilauea Volcano. It feels like a never-ending emergency with no real end in site. On Friday, the U.S. Geological Survey says there were 90 earthquakes in the span of six hours.

Ash plumes were being thrown 3 kilometers, about 10,000 feet into the air. And more people are being told to leave, as molten lava flows further into the streets towards their homes. While many have already packed up their belongings, one man stayed to battle this volcano's destructive fury. Scott McLean has his story for us.

(BEGIN VIDEOTAPE)

SCOTT MCLEAN, CNN CORRESPONDENT: Kilauea continues to force evacuations here in Hawaii. People are especially reluctant to stay behind because it is almost impossible to protect your home from lava. I say almost because we met a man who took on Mother Nature and won, all to protect a property that is not even his.

STEVE HILL, HAWAII RESIDENT: It's a beautiful place. It's a place that feels very alive.

MCLEAN (voice-over): It was two decades ago that Steve Hill found his slice of Hawaiian paradise. And two weeks ago, he came to grips with losing it.

MCLEAN: You left this place fully expecting you wouldn't come home to it.

HILL: Lost. Lost.

MCLEAN (voice-over): Hill and his wife packed up their furniture and left for the mainland. He even left a shot of gin on the deck for Pele, the Hawaiian volcano goddess, assuming both the gin and his two homes would be swallowed up.

HILL: We left feeling heartbroken. It's like our homes are gone.

MCLEAN (voice-over): But his contractor and close friend, Darryl Clinton, had other ideas.

DARRYL CLINTON, CONTRACTOR: Might want to step back on this one.

MCLEAN (voice-over): Just one week ago, CNN was with Clinton while he was defending Hill's homes against flying chunks of molten lava. Windows had already been destroyed, so had the water catchment tank. Some lava bombs even came crashing through the roof.

Armed with little more than a garden hose, Clinton doused the flaming rocks before they torched the entire house.

CLINTON: These are the ones that catch the ceiling on fire.

MCLEAN (voice-over): The 24/7 task was difficult and even more dangerous. After almost a week, Hill told Clinton to leave and let the houses burn.

HILL: You can't do this, this is unsafe. It's time to stop. Valiant effort. I'm humbled by how hard you've tried. MCLEAN (voice-over): But Clinton didn't leave until the next day and it wasn't by choice. A line-drive lava bomb broke his leg, severed an artery and nearly took his foot off.

CLINTON: Just took my leg out and threw me against the wall. It was the most extreme force I've --

[04:35:00]

CLINTON: -- ever felt in my life.

MCLEAN (voice-over): The extreme heat burned up the deck, the wall and almost an entire dining set. But thanks to a fast-acting neighbor with a water jug, the house survived and so did Darryl.

HILL You're blessed with neighbors like that.

MCLEAN (voice-over): Hill returned to Hawaii to find his homes and his friend who helped build them both badly in need of repair.

HILL: When Darryl is done rebuilding himself then we'll get on to rebuilding houses.

MCLEAN: He is a journeyman.

HILL: He is a journeyman. He is a beautiful person.

MCLEAN (voice-over): In a place where lava insurance is far too costly to be common, Hill knows that saying thank you isn't saying nearly enough.

HILL: This place stands because Darryl chose not to go home. It stands because he believed that he could save it. I mean, that is it.

MCLEAN: Darryl Clinton has a metal rod in his leg, he's had at least three surgeries and right now he is in Honolulu for another one. He has a long road ahead of him but he does have support. His friend Steve Hill says that he will do whatever he can to get Darryl back on his feet. And his other neighbors are doing what they can to pitch in as well -- Scott McLean, CNN, Pahoa, Hawaii.

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HOWELL: Still ahead here on NEWSROOM, the E.U.'s new data laws are now in play and it may be causing a flood of privacy policy updates in your inbox. We'll explain that ahead.

Plus Alexa, is Alexa spying on you?

How Amazon's voice assistant ended up sharing a user's private conversation with a random contact. Yikes.

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[04:40:00]

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HOWELL: Have you checked your inbox today?

The e-mails that may be driving you, me and everyone a bit crazy, websites telling you that they have updated their privacy policies. But this is not spam. It is part of a new regulation rolled out across the European Union. And some of the world's biggest companies could be breaking the rules already. Samuel Burke explains.

(BEGIN VIDEOTAPE)

SAMUEL BURKE, CNN CORRESPONDENT (voice-over): Austrian lawyer Max Schrems (ph) has been fighting Facebook in court over data privacy for nearly a decade. And today, he wasted little time, his NGO suing Facebook for allegedly violating the E.U.'s new data protection law, called GDPR, the day it came into force.

MAX SCHREMS (PH), AUSTRIAN LAWYER: We were looking for big companies that really willfully violate the law, that try to ignore it and try to get away with it.

BURKE (voice-over): Schrems (ph), who helped write the regulations. says he is taking legal action because Big Tech isn't complying with the law.

SCHREMS (PH): Various read that said here if we don't want this, we think it is stupid so we don't want to comply with is. And then there is obvious business interests. There is certain things that you simply can't do with data anymore that give a profit.

BURKE (voice-over): The new law was supposed to stop companies from hoovering up your sensitive data, like political opinions, religious beliefs, ethnicity and sexuality, for advertising purposes without your consent. According to legal experts CNN spoke with, Facebook is skirting this requirement.

UNIDENTIFIED MALE: On your Facebook profile, you can put in things like sexuality, religion or political beliefs. And if you put that on, you don't have any choice but for Facebook to use it to personalize content, to deliver the advertising and so on.

BURKE: There is only an "I accept" button.

UNIDENTIFIED MALE: Exactly.

BURKE: There's not an "I don't accept" button.

UNIDENTIFIED MALE: Exactly. You've got it.

BURKE (voice-over): He says even if you completely remove sensitive traits from your profile, Facebook can still glean information, such as your sexual orientation, by analyzing your behavior on the platform and on other websites, too. UNIDENTIFIED MALE: Facebook can infer things from the great amount of data it has about you across the Web and also across your mobile devices and apps that also send data to Facebook.

BURKE: As you understand the law, does it prevent Facebook from making these inferences that they make about us?

UNIDENTIFIED MALE: Yes. That law forbids Facebook from making these inferences without explicit consent.

BURKE: Failure to comply could be costly for a big company like Facebook. European data regulators can impose a fine of up to 4 percent of its global annual revenue.

Based on 2017 figures, that means Facebook could face a penalty topping $1.6 billion each time it runs afoul of the new law.

BURKE (voice-over): In a statement to CNN, Facebook's chief privacy officer said the company has, quote, "introduced better tools for people to access --

[04:45:00]

BURKE (voice-over): -- "download and delete their information."

The company also says it is building a new tool that will allow users to stop Facebook from storing information about them it collects from other websites and apps.

UNIDENTIFIED MALE: We do expect about to be fully compliant on May 25th.

BURKE (voice-over): Lawyer Max Schrems (ph) believes the new rules are tough enough to prevent the kind of data scraping that companies like Cambridge Analytica have engaged in.

SCHREMS (PH): If reinforced improperly, we can actually get a balance in this digitalized age. In the end, you, as a customer, have the possibility to use, let's say, Facebook without worrying 24/7 about your data.

BURKE (voice-over): However the courts come down on the tech giants, Europe's new data regulations are already redrawing the line between profit and privacy -- Samuel Burke, CNN, London.

(END VIDEOTAPE)

HOWELL: To talk more about this, we have with us Jesse Bockstedt, an associate professor of information systems at Emory University.

It's a pleasure to have you hear with us, Jesse, to talk about this.

So what is the deal with all of these e-mails, from big and small companies alike, flooding our inboxes with these compliance notes, basically asking consumers to take action?

Consumers have asked for more control over their personal data.

What does this mean for them?

JESSE BOCKSTEDT, EMORY UNIVERSITY: Well, we're seeing all these e- mails because the regulation in Europe states that any company that operates in Europe or has users based in Europe has to notify users of how they will use their data, how they plan to distribute their data.

And all these companies are now notifying everyone of how they are trying to comply with the new regulations. I think what we'll see for users going forward is a lot more requests for consent.

One of the things that really is laid out in the GDPR is this requirement for consent to capture and process personal data from users. And in the past or up to this point, it has mostly been an opt-out thing; by default you are sharing your data with these companies.

And now it is moving the needle more toward an opt-in type scenario, where you actually have to give explicit permission and these companies now have to justify why they need that data, how they plan to use that data.

So in theory, users will have a lot more rights around their data, rights to access and understand how their data is being used and distributed, rights to erase their data if they want to remove it from the services.

Whether or not they take advantage of those rights, that is the big question. Actually privacy researchers have long talked about something called the privacy paradox, which is that users claim they want privacy, they want more control over their data. But then their actions online and the types of services and things they do say the counter to that.

So it will be interesting to see how many users take advantage of these new regs.

HOWELL: Let's talk about this, because the regulations apply to Europe but we're seeing companies around the world seem to take a blanket approach just to be in compliance with this.

Has Europe really set the stage for the rest of the world to follow?

BOCKSTEDT: I think so. It may be a little bit longer before we see these regulations here in the U.S. Europe and the European Union, both citizens and lawmakers, tend to have a stronger stance on privacy than we see here in the United States.

But I think these regulations do capture what users want to see. So I know there are some proposals in California with similar types of regulations. Right now, in the United States, it is more of a state- by-state thing in terms of things like notifications on data breaches. And I think we'll see more coming down the pike.

One thing that is interesting is how this will affect the business models of the companies that require heavily on personal data for revenue, for target advertising and things like that.

HOWELL: One person that has been on the hot seat with regards to transparency, with regards to security, the CEO of Facebook, Mark Zuckerberg. He was in Europe, talking to regulators there and he spoke about regulation. Let's listen and we'll talk about it on the other side.

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MARK ZUCKERBERG, COFOUNDER AND CEO, FACEBOOK: We're doubling the number of people working on safety and security at our company to more than 20,000 by the end of this year.

On top of the investments that we're making in other areas, I expect that these increased investments in security will significantly impact our profitability. But I want to be clear, keeping people safer will always be more important than maximizing our profits.

(END VIDEO CLIP)

HOWELL: Critics say that he danced around a lot of their questions, that Facebook continues to skirt around the regulations.

Basically what are the biggest takeaways from what you heard from Zuckerberg?

BOCKSTEDT: I think they haven't quite figured it out yet. They are moving in the right direction, I think, employing an additional 10,000 people to monitor and curate content. It is a great move to make sure data is not being misused, abused and deal with things like fake news.

[04:50:00]

BOCKSTEDT: And pursuing machine learning and artificial intelligence- type solutions is the right way to move. But it may be a while before those capabilities are there to provide the scale that is needed.

At the end of the day I think he didn't provide the detail that the lawmakers were looking to hear. The E.U. lawmakers had the advantage of seeing his testimony in the United States and knowing what type of questions to ask. And they asked tougher questions and looked for more details, in my opinion.

They focused in on things like whether or not Facebook is reaching a monopoly type environment. And I think the concerns in Europe are a lot stronger than they were during the U.S. hearings. And so I don't think he provided enough detail. But the format wasn't good for that, either.

They asked all their questions first and then he responded to all of them at once at the end in about 25 minutes, which made it difficult for him to address all the issues. It also gave him an opportunity to skip over issues that maybe he didn't want to talk about.

And so I think, hopefully, if there is followup hearings on this, hopefully there is more of a question-response so we can get more answers. But at the end of the day, I don't think they have quite figured it out yet. And it is an ongoing process.

HOWELL: We'll talk to you more next hour about breaches. The companies have to notify consumers about breaches and also the fines. Jesse Bockstedt, thanks for your time today. We'll be back.

BOCKSTEDT: Thanks, George.

HOWELL: We'll be right back after the break.

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[04:55:00]

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HOWELL: The Amazon voice assistant, Alexa, can do many things and apparently even snoop on your private conversations. Our Anna Stewart explains.

(BEGIN VIDEOTAPE)

ANNA STEWART, CNN CORRESPONDENT (voice-over): It is a cautionary tale of technology telling too much. A woman in Oregon says Amazon's Alexa recorded and then e-mailed a random person with a private conversation that took place in her house.

DANIELLE, ECHO OWNER: I felt invaded, like total privacy invasion. Like immediately, I'm like I'm never plugging that device in again. I can't trust it.

STEWART (voice-over): Amazon Echo owner Danielle says she was chatting with her husband about hardwood floors when the device sent an audio file to a man who worked for her husband. She only found out about the recording when she received an alarming phone call.

DANIELLE: The person on the other line, said unplug your Alexa devices right now. We go around and unplug them all and he proceeded to tell us that he had received audio files, recordings from what was going on in our house.

STEWART (voice-over): Amazon told CNN affiliate KR7 (ph) the device misinterpreted commands like "send message" and the contact's name as part of the background conversation and called it an extremely rare occurrence. It is unknown if the couple didn't hear Alexa's voice replies or see the speaker light up when it was activated.

Or if the device responded at all. By the way, it is a case of mixed signals that has a lot of consumers thinking twice about just who or what they bring into the house.

(END VIDEOTAPE)

HOWELL: Creepy. More news after the break.