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Catastrophic Harm, Theresa May Warns Of Dire Consequences If Her Brexit Deal Does Not Go Through; Explosive Headlines - The White House Deals With The Fallout Of Two Reports That Suggest Closer Ties Between Donald Trump And Russia; Demanding Payback, We Speak With Malaysia's Finance Minister Who Says He Wants Goldman Sachs To Repay Billions For The 1MDB Scandal.. Aired: 8-9a ET

Aired January 14, 2019 - 08:00   ET

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


KRISTIE LU STOUT, CORRESPONDENT, CNN: I'm Kristie Lu Stout in Hong Kong and welcome to "News Stream." Catastrophic harm, Theresa May warns of dire

consequences if her Brexit deal does not go through. Explosive headlines - the White House deals with the fallout of two reports that suggest closer

ties between Donald Trump and Russia. And demanding payback, we speak with Malaysia's Finance Minister who says he wants Goldman Sachs to repay

billions for the 1MDB scandal.

It the beginning of a critical week for Britain's Prime Minister as she faces her biggest Brexit battle yet. In the coming hours, Theresa May will

make a last ditch attempt to convince lawmakers of her plan to leave the European Union before Tuesday's make or break vote.

Over the weekend, she warned Parliament that failure to deliver Brexit would be catastrophic. A short time ago, Mrs. May was in Stoke-on-Trent,

it's a pro-leave city making the case for her deal to factory workers.

(BEGIN VIDEO CLIP)

THERESA MAY, BRITISH PRIME MINISTER: That while no-deal remains a serious risk, having observed events at Westminster over the last seven days, it's

now my judgment that the more likely outcome is a paralysis in Parliament that risks there being no Brexit. That makes it more important that MPs

consider very carefully how they will vote tomorrow night.

(END VIDEO CLIP)

LU STOUT: Now, we are covering this story from across the region. Let's begin with Anna Stewart in Midlands, England where Theresa May recently

spoke, and Anna, Prime Minister Theresa May's message is effectively "approve my deal or risk no Brexit at all." So how is that dire warning

going down with people there?

ANNA STEWART, REPORTER, CNN: A very grim warning, indeed. She was here speaking to factory workers at the Portmeirion Group telling them what her

plan is. She had a factory tour before she gave that speech you just saw.

Now, although she was speaking to the factory workers, really, the message we were getting was very much for the MPs back in Westminster, and as you

said, it was "back my deal or get no-deal or perhaps no Brexit at all." Take a listen.

(BEGIN VIDEO CLIP)

MAY: There are some in Westminster who would wish to delay or even stop Brexit and who will use every device available to them to do so. I ask

them to consider the consequences of their actions on the fate of the British people in our democracy.

What if we found ourselves in a situation where Parliament tried to take U.K. out of the E.U. in opposition to a remain vote? People's faith in the

democratic process and their politicians would suffer catastrophic harm.

(END VIDEO CLIP)

STEWART: Now, this area voted overwhelmingly to leave, so it is a really strategic move for her to come here to show this is what the people voted

for over two years ago. We'll be gauging sentiment throughout the day in town. So far, the people we've spoken to all voted to leave in 2016.

We've only met one person who would change their vote if there was a second referendum, if they had another opportunity.

But I wouldn't say sentiment has shifted much from what we've been seen. Now the Prime Minister heads back to London, back to Parliament where she

will be making a statement there, Kristie.

LU STOUT: Forceful words from the British Prime Minister there on Stoke- on-Trent, but thank you very much for your reporting, Anna Stewart. Let's go to Bianca Nobilo next. She is standing outside Parliament. Bianca,

Parliament begins its last full day of debate on Theresa May's Brexit plan, but is anything new going to be said to move the needle at all?

BIANCA NOBILO, CORRESPONDENT, CNN: Well, that's what MPs have been hoping for. The penultimate day of this debate is kicking off today. But the

constellations in Parliament don't look any different. You've still got the DUP that prop up the government deeply concerned about what May's deal

will do to the status of the union and Northern Ireland's position within that.

You have the remainers who think that if they can hold on, they might be able to push for that second referendum, extend Article 50 for a deal which

would bring the relationship between the E.U. and the U.K. closer and then, of course, you have the Labour Party who also have to think about trying to

get themselves into power, and that's also factoring into the equation and you have the Brexiteers who think that this deal simply doesn't go far

enough to satisfy why people voted for Brexit in the first place.

We have had a few switches, people who first had said that they were going to vote against the Prime Minister's deal, declaring over the last 24 hours

that they are in fact going to support it now. But given that MPs have told me that we are looking at a defeat of May's deal here within a sliding

scale of at minimum around 50, highly unlikely, or at maximum about 230.

She is going to need a lot more than a few MPs to try and get herself over the line to get a modest defeat which would give her some room to continue

with this deal, in the hope that she might be able to amend it further.

[08:05:10]

NOBILO: And win some more MPs on the side, but this just underscores what unprecedented political times that we're living in? The notion that the

government of the day could be looking at a defeat of its flagship policy by a margin of somewhere in the 200s is just startling and shows us that we

are living in truly historic times.

LU STOUT: Bianca Nobilo with the pulse of Parliament during these unprecedented times. Bianca, thank you. Hadas Gold is standing by at 10

Downing Street and Hadas, what will Theresa May do if as expected, her Brexit bill is rejected?

HADAS GOLD, CORRESPONDENT, CNN: Kristie, Theresa May does have a few options but honestly, none of them are likely palatable to her. As she has

said over and over again and as we heard earlier today, she wants her deal, this deal that she has put forth to Parliament to pass so they can get on

with it and leave the European Union on March 29th at 11:00 p.m. as had been agreed to.

But few things she could do, per a recently passed amendment in the House of Parliament, she would need to come back within a few days if her vote

fails with a new deal. That means that she would have to probably go back to the European Union and negotiate something else. Get some more

substantial concessions and try to convince them that if they can give her a little bit more, then she could come back here and possibly win.

And that is why that margin of loss that Bianca was talking about is actually rather important. She could try to pass a few indicative votes in

Parliament to try to get some sort of consensus on what members want. She could also call a snap election and try to get more of a majority. But we

saw how that worked for her last time, it didn't end very well.

I mean, there's a lot - there's a few other options. She could also of course resign. She could also kick the can down the road and try to wait

as we get closer and closer to the March deadline before she brings a vote back.

There is of course the option of a second referendum, but Theresa May has said over and over again, she will not have a second referendum because the

will of the people has already been heard in 2016 and that's what she will see through.

But as we have been saying so far, it doesn't look good for her plan, so we are obviously going to see something else come out of 10 Downing Street

behind me sometime soon -- Kristie.

LU STOUT: So many options. It can go any which way. Hadas Gold live from 10 Downing Street, thank you. And Erin McLaughlin joining us now from

Brussels, and Erin, the E.U. sent a letter to Theresa May. What did it say?

ERIN MCLAUGHLIN, CORRESPONDENT, CNN: I think it's more significant, Kristie what was not included in that letter which is what Theresa May was

looking for -- language providing legal certainty that the backstop which is at the center of this legislative impasse there at Westminster, that

backstop would be temporary. This letter falls short of it, issued today by the President of the European Commission, Jean-Claude Juncker as well as

the President of the European Council, Donald Tusk saying instead, quote, "The Commission can confirm that just like the United Kingdom, the European

Union does not wish to see the backstop enter into force. Were it to do so, it would represent a suboptimal trading arrangement for both sides."

Again, falling short of that legal certainty language that Theresa May had been looking for originally. She proposed a start date for the future

relationship to be enshrined in E.U. and U.K. law that of course not included in this letter. What this letter is designed to show, according

to diplomats I've been speaking to here in Brussels is that the E.U. wants to cooperate with Theresa May, they want to see this deal get through

Parliament and crucially, they don't want to be blamed for Brexit.

LU STOUT: Erin McLaughlin reporting live from Brussels. Erin, thank you. CNN has uncovered more information on a bombshell report concerning U.S.

President Donald Trump's dealings with Russia. On Friday the "New York Times" reported that the FBI opened a counterintelligence investigation

into Mr. Trump in 2017.

And now, CNN has obtained transcripts from closed door congressional interviews with two FBI officials. They show that senior FBI officials

debated whether the President was quote "following directions from Russia." The inquiry was launched following the firing then FBI Director James

Comey.

Now meanwhile, the "Washington Post" has also published a damaging article on President Trump's relationship with Russia. According to "The Post,"

Mr. Trump went to quote "extraordinary lengths to conceal details of his meetings with Vladamir Putin." It says he even confiscated notes from his

own interpreter and stopped him from discussing details of the meeting with anyone else, even administration officials.

We are joined now by Shimon Prokupecz live from Washington. Shimon, thank you so much for joining us. Let's first talk about bombshell number one,

was President Trump working on behalf of Russia when he acted on James Comey?

SHIMON PROKUPECZ, CRIME AND JUSTICE REPORTER, CNN: Look, you know, certainly, there was that concern from the FBI in the aftermath of the

firing of the then, FBI director, James Comey, and really, what our new reporting, this new information that we obtained ...

[08:10:10]

PROKUPECZ: ... from the transcripts of two FBI officials who testified in closed door meetings with congressional officials, congressmen and

certainly their investigators. And what the interviews revealed that on one end, there was the idea from the senior level people at the FBI that

Trump fired Comey at the behest of Russia and then the other possibility certainly was that Trump was completely innocent and was acting within the

bounds of his executive authority.

Now, one of those officials, the former top FBI lawyer, James Baker, when he testified to Congress, he described his thinking this way and certainly,

in terms of Russia, that quote, "That was one extreme. The other extreme was that the President is completely innocent and we discussed that, too.

There's a range of things this could possibly be," he told members of Congress, "We need to investigate because we don't know whether, you know,

the worst case scenario is possibly true or the President is totally innocent and we need to get this thing over with so he can move forward

with the agenda." He told members of Congress.

And then in another interview which the transcript of which we've obtained, another FBI lawyer, and of course many people will recall her, her name is

Lisa Page, and as you recall, she came under fire for her texts with Peter Strzok. She told members that the FBI had considered investigating Trump

for some time saying, quote, "It's not that it could not have been done. This case had been a topic of discussion for some time. The 'waiting on'

was an indecision, a cautiousness on the part of the Bureau with respect what to do whether this was sufficient predication to open."

And of course, she means open an investigation. And now we know obviously that that did happen, all of that still ongoing with the Special Counsel,

Robert Mueller and his team have taken over that part of this investigation and all of that is still ongoing.

LU STOUT: Wow. So we have that bombshell, and on top of that, we have another one from the "Washington Post" that was published over the weekend.

It reports that Donald Trump has gone to quote "extraordinary lengths" to conceal details of his meetings with Vladamir Putin. How so and just how

unusual is this?

PROKUPECZ: Look, I think people who have covered the White House for quite some time and national security experts say that's highly unusual that the

President, A, doesn't share information and meetings and conversations with officials from other countries, and the other thing is that he doesn't

include people on his own National Security team. Certainly, not when he met with Vladimir Putin in these meetings.

And so some people are now calling on members of Congress to subpoena. They want to subpoena some of these translators who were present in these

meetings, certainly the ones with Vladimir Putin that Donald Trump had in Helsinki and other places. We'll see what happens. So there is clearly a

lot of concern by members of Congress that information is being hidden, that it is not being shared. The President certainly has not given any

kind of substantial read-out. The White House hasn't given any substantial read-out of what these meetings were about.

You know, the "Washington Post" saying that the President went as far as taking notes away from one of the translator, it's a pretty significant

move by the President, but it also goes to the idea that the President doesn't trust anyone and he was concerned that information would leak. Why

would he be concerned about that information from a private meeting he had with Vladimir Putin would leak? Who knows?

But we'll see. There is growing word here from folks on the Hill that they want to subpoena now these translators.

LU STOUT: All right, Shimon, we'll leave it at that. Thank you so much for walking us through these two reports. Really appreciate it. Take

care. Meanwhile, it seems that more people are blaming the U.S. President for the partial U.S. government shutdown. We are now into the fourth week

of the shutdown, and in a new CNN poll, it shows that some 55% of the American public believe that Mr. Trump is at fault, while only 32% think

that U.S. Democrats are responsible.

Now regardless of who is to blame, the shutdown is hurting ordinary Americans. For 800,000 Federal workers, it is another week without pay.

Some are seeking relief through crowd funding. Government employees have set up more than 1,000 online fund-raising pages so far. Some people not

working have even applied for unemployment, which is what comments like this one from White House economic advisor, Kevin Hassett are a bit

difficult to swallow.

(BEGIN VIDEO CLIP)

KEVIN HASSETT, CHAIRMAN, COUNCIL OF ECONOMIC ADVISERS: A huge share of government workers who were going to take vacation days say between

Christmas and New Year's, and then, we have a shutdown and so they can't go to work. And so then, they have the vacation, but they don't have to use

their vacation days. And then, they come back and then, they get their back pay, then they are in some sense, they're better off.

(END VIDEO CLIP)

[08:15:03]

LU STOUT: Travelers have also been affected by this partial shutdown. A TSA checkpoint at the George Bush International Airport in Houston, Texas

shut down on Sunday due to staffing issues.

A big break in the search for answers to what caused a LionAir plane to plunge into the Java Sea. Divers have recovered the second black box of

the brand new plane. Plus, America's withdrawal from the war in Syria will leave its long-time ally behind. The battle the Syrian Kurds may soon be

fighting alone, just ahead.

(COMMERCIAL BREAK)

LU STOUT: Coming to you live from Hong Kong, welcome back, this is "News Stream." Indonesia's Navy has recovered to cockpit voice recorder from a

LionAir flight that crashed in October, and it could help explain why the brand new plane plunged into the Java Sea off the coast of Jakarta. CNN's

Ivan Watson has the story.

(BEGIN VIDEO TAPE)

IVAN WATSON, SENIOR INTERNATIONAL CORRESPONDENT, CNN: Indonesian Navy divers celebrated on the deck of their ship after the successful recovery

of the cockpit voice recorder from LionAir flight 610. It has taken more than two months to locate it and bring it up off the seabed. It was

located at a depth of some 30 meters and buried in mud as well.

Now, hopefully, it is going to answer some questions. There is a big mystery about the crash of what was a brand new Boeing 737 some 10 minutes

after takeoff from Jakarta's main airport. Information that was recovered from the flight data recorder revealed that the plane was getting faulty

information from some of its sensors, which kicked in an autopilot feature that sent the plane into a dive.

Now the data that was recovered showed that during what must have been a terrifying and very turbulent 10-minute flight, the human pilot was

struggling with the autopilot trying to pull the plane out of this automated dive, and that this struggle, this up and down motion, a roller

coaster in the sky took place more than 30 times.

The cockpit voice recorder might reveal to us conversations that took place between the pilot and co-pilot during these last terrible moments and

perhaps explain why they were not able to turn off this autopilot feature and help explain about the loss of both the aircraft and 189 passengers and

crew on board. Ivan Watson, CNN, Hong Kong.

(END VIDEO TAPE)

LU STOUT: The U.S. Secretary of State says he raised the issue of Jamal Khashoggi's murder with the Saudi King and Crown Prince. Mike Pompeo met

with the leaders of Riyadh a short time ago. He says that he told them that every single person involved in the murder needs to be held

accountable.

[08:20:08]

LU STOUT: He says King Salman and Crown Prince Mohammed Bin Salman also acknowledged the need for accountability. Right now, 11 individuals are on

trial for their alleged involvement. Riyadh maintains neither the King nor the Crown Prince knew about the operation.

Turkey is firing back at the U.S. President after he threatened to devastate Turkey economically if it hits Kurds in Syria. Washington has

begun its slow withdrawal from Syria and that has raised concerns about the security of U.S.-backed Kurdish fighters there.

Turkey responded to Mr. Trump tweet saying, "It fights against terrorists, not Kurds." Donald Trump also tweeted that the Kurds must not provoke

Turkey. Our chief international correspondent, Clarissa Ward, filed this report about how Kurds see the situation in Northern Syria, let's listen

in.

(BEGIN VIDEO TAPE)

CLARISSA WARD, CHIEF INTERNATIONAL CORRESPONDENT, CNN (voice over): In Kobani, the graves of Kurdish fighters are still fresh. Twenty-seven-year-

old Mahmoud Rasool was killed less than two weeks ago in an ISIS ambush near the town of Deir ez-Zor.

"Get up, get up, my son. I beg you," his mother Najma weeps. These are the people left behind to mourn. Now, they are bracing for the moment they

will be left behind again as the U.S. begins to withdraw its forces from Syria.

"They got what they wanted. They used the Kurds to get rid of ISIS and now they're leaving us," Najma says. "America was supposed to have our back."

WARD (on camera): Almost every family in this town has lost someone in this war, and the very real fear here now is that when the Americans leave,

there will be war here once again.

WARD (voice over): Just across the border is Turkey which view the Syrian Kurds as terrorists. To the west is the brutal regime of Bashar al-Assad

and its Russian and Iranian backers. Kurdish military commander, Sharfan Darwish, tells us the Americans provided the Kurds with a buffer. In

return, the Kurds took the fight to ISIS.

"After all those years that we fought terrorism together," he says, "It's their minimum duty to help guarantee our security." He takes us to the

town of Arima where the intricate patchwork of different powers can be seen close up.

SHARFAN DARWISH, KURDISH MILITARY COMMANDER: (Foreign language).

WARD (on camera): So the regime and the Russians are just over there.

DARWISH: (Foreign language).

WARD: And the Turks over there. Well, American? The Americans?

DARWISH: (Foreign language).

WARD (voice over): We drive closer to the joint Russian regime base. But it's too dangerous to stop. Less than five minutes away, the Americans are

still flying their flag, but it won't be there for long. U.S. military hardware is already beginning to move out. No one knows what comes next

for the Kurds. On the road back to Kobani, we happened upon a funeral. Two Kurdish security officers killed by a roadside bomb, a reminder of the

daily dangers faced here.

After an exhausting battle against ISIS, the Kurds may now have to defend themselves against more powerful enemies alone.

(END VIDEO TAPE)

LU STOUT: A very uncertain future for the Kurds in Northern Syria. Clarissa Ward filed that report and she joins us now on the line from

Northern Syria. And Clarissa, as the U.S. withdraws from Syria, what impact is it going to have on this multi-pronged, multi-party battlefield?

WARD (on the phone): Well, that's the million dollar question, Kristie. I mean, you saw from our piece this very delicate, delicate balance that is

in effect in parts of this country where you have multiple powers essentially carving up different areas. The front line that we visited

between the regime and the Kurds is not an active front line at all, there is no fighting. But that could easily change if the balance of the

situation is shifted in some kind of dramatic way.

What people here largely expect is that the Kurds will have no choice, in essence, but to now try to form some kind of a deal with the regime of

Bashar al-Assad, with his Russian and Iranian backers and that they will come to some kind of a consensus or agreement whereby the Kurds will be

allowed their degree of autonomy or independence and then the regime, in response, the regime will offer them some measure of protection from

Turkey.

[00:05:03]

WARD: Turkey of course, Kristie, is the powers that the people in Kurdish areas see as being the greatest threat and so they were somewhat encouraged

to see President Trump tweet overnight that the U.S. would essentially economically devastate Turkey if they took direct action against the Kurds,

Kristie.

LU STOUT: Offering some comfort to Kurds in Northern Syria. Clarissa Ward reporting live on the line from inside Syria. Thank you. You're watching

"News Stream" and keep it here, because up next, we have a candid conversation with the Finance Minister of Malaysia as the 1MDB fallout

intensifies particularly for Goldman Sachs.

(BEGIN VIDEO CLIP)

LU STOUT: In terms of payback, how much?

LIM GUAN ENG, MINISTER OF FINANCE, MALAYSIA: $7.5 billion dollars.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

LU STOUT: I'm Kristie Lu Stout in Hong Kong, you're watching "News Stream" and these are your world headlines. Saudi Arabia is the latest stop on

Mike Pompeo's Middle East tour. The U.S. Secretary of State met earlier with the Saudi King and Crown Prince and says he told that them every

single person responsible for the murder of Jamal Khashoggi needs to be held accountable. He says the leaders acknowledge accountability needs to

take place.

CNN has obtained transcripts explaining why the FBI opened a counter- intelligence probe into U.S. President Donald Trump in 2017. The Congressional transcripts show that senior FBI officials debated whether

the President was following directions from Russia. The Bureau opened the investigations after the dismissal of then FBI Director, James Comey.

British Prime Minister Theresa May is scrambling to save her Brexit deal before a critical vote in Parliament on Tuesday. Speaking at a factory in

the last few hours, she warned that rejecting her plan could result in a no-deal scenario or no Brexit at all. Lawmakers continue to debate the

Prime Minister's deal in Parliament before she delivers a statement later on Monday.

Goldman Sachs is grappling with one of its biggest scandals ever, 1MDB. The investment bank is due to report earnings on Wednesday as Malaysia

demands billions in compensation related to the Sovereign Wealth Fund.

Earlier today, I spoke to Malaysia's Finance Minister about all things 1MDB. Take a listen.

(BEGIN VIDEO TAPE)

LIM: They are going to declare the annual earnings, I think, next month. We hope they make the necessary provisions for reparations to Malaysia. We

feel that Goldman Sachs has to bear responsibility especially towards these issues.

LU STOUT: You want responsibility, you want reparations. So in terms of payback, how much?

[08:30:04]

LIM: $7.5 billion dollars - that is what we are seeking. I think that's a very reasonable amount regardless the $6.5 billion raised to the one

insurance. We don't know what happened to the money. The fees will pay for services that was not duly rendered, breach of fiduciary duty. And of

course, finally, the fact that they brokered a deal which was 100 basis points higher than that market rate that doesn't you know, make sense. I

think many people can do that without paying you $600 million dollars.

LU STOUT: How do you plan to prove that this was the action of an institution and not just a few rogue individuals?

LIM: The fact that the executive, the senior executive who explained that new deal has full access to the former CEO and I think the evidence will

clearly show that Goldman Sachs was in the know. How can you disclaim responsibility when you collected such a huge amount of fees and at the

same time, you were, of course, broadcasting the fact that you were representing Malaysia? I don't think they can find a way so easily.

LU STOUT: Both your government and the U.S. government have charged Joh Low, the alleged 1MBD architect and mastermind for money laundering and

other offenses. He is believed to be inside China, but exactly where? Where is Joh Low?

LIM: We are still searching for him. We will get him.

LU STOUT: Do you believe that he's on the coast of China? Is he in Guangzhou?

LIM: I think that information is still at the moment, speculating.

LU STOUT: There must be full accountability. And again, the architect is this Malaysian citizen, Joh Low, a boy from Penang, you're from Penang. Do

you ever think, what happened to this boy from Penang that would allow him to allegedly plunder billions from this home country?

LIM: I think the critical question would be why did the Prime Minister allow Joh Low, who just graduated from college to run riot, to do as he

pleased? Why did he place his trust on the nation's treasury completely in his hands to do as his rights? I think that is a critical question.

LU STOUT: How do you answer that question?

LIM: There is only one answer in court.

LU STOUT: And finally, your message to the people of Malaysia who were supposed to benefit from this massive development fund, but this money has

been allegedly siphoned away to purchase private jets, properties, multi- million dollar paintings, parties, et cetera, what's your message to them?

LIM: We will do whatever it takes to ensure that justice is done and that Malaysia will try to get as much of our money back. And finally, we want

Malaysia, Malaysians especially that they can hold their heads up high again, that Malaysia is no longer a global autocracy. We are now a normal

boring democracy.

LU STOUT: You want to be boring?

LIM: Yes, I want to be a normal boring democracy, where there are no financial scandals. No more 1MDB, no more Joh Low, and of course no more

Prime Minister.

LU STOUT: Sir, good luck with that. Take care.

LU STOUT: Thank you. Thank you, Kristie.

(END VIDEO TAPE)

LU STOUT: Now meanwhile, China's massive export industry just suffered its worst month in two years but still managed to swing a record trade surplus

with the U.S. On the value of goods shipped from China to the rest of the world, fell more than 4% in December compared to the same period one year

ago.

But China still managed to rack up a record trade surplus of $323 billion with the U.S. last year. This is something policymakers feel may prompt

U.S. President Donald Trump to up the heat on Beijing in their ongoing trade war.

Now, for more on this, as we'll see opening bell at Wall Street, watch "First Move with Julia Chatterley" that begins in about 25 minutes.

Now, this just into us here at CNN, a Chinese court in Dalian has sentenced a Canadian citizen to death after convicting him of drug trafficking. His

name, Robert Lloyd Schellenberg. He was originally sentenced to 15 years in prison, but the prosecution claimed to have found more evidence after

further investigation. Any more details on the story, we will bring it to you right here on CNN.

The head of Japan's Olympic Committee denies accusations of corruption in connection with Tokyo's successful bid to host the 2020 games. French

authorities have placed Tsunekazu Takeda under formal investigation with regards to the bidding process. The IOC, the International Olympic

Committee says its ethics panel has opened a file on the case. Takeda says he will cooperate with the probe

Will Ripley has more.

(BEGIN VIDEO TAPE)

UNIDENTIFIED MALE: Tokyo.

WILL RIPLEY, CORRESPONDENT, CNN (voice over): Tokyo's winning bid for the 2020 Olympics came just when Japan really needed a win.

[08:30:07]

RIPLEY: Still reeling from the 2011 earthquakes, tsunami and nuclear meltdown, Tokyo 2020 symbolized a new beginning, but that new beginning

could be tarnished by accusations of financial crimes on top of concerns over the bloated multi-billion dollar budget.

Paris prosecutors are investigating the head of Japan's Olympic Committee, Tsunekazu Takeda, scrutinizing his role in the bidding process amid reports

of a suspicious $2 million payment made right around the time Tokyo beat out Istanbul and Madrid.

Takeda, a former Olympian remains on the job. He denies any wrongdoing. In a statement, he says the payment to a Singapore company was fair

compensation based on a consulting agreement insisting there was no improper action that can be recognized as bribery.

Tokyo Governor Yuriko Koike told reporters Friday, she is bewildered by the Paris probe. The International Olympic Committee tells CNN Takeda is

presumed innocent until French authorities prove otherwise.

RIPLEY (on camera): The timing of all of this has some people here in Japan suspicious, wondering if a high profile case, a case right here in

Tokyo may be motivating French authorities.

RIPLEY (voice over): Nissan's ex-chairman, Carlos Ghosn, the auto kingpin who is arguably the most famous businessman in France is facing a growing

list of financial misconduct charges in Japan. French investigators began their formal investigation of Takeda within weeks of Ghosn's arrest.

It's so similar to Ghosn's case says Yukihiro Tanesheta. It's like China and Canada. Something similar seems to be going on between Japan and

France.

The timing of these allegations is so sudden says Makiko Hontama. I just wonder why now.

It's a common question in Tokyo these days, and just the latest embarrassment for Olympic organizers.

The original logo, accused of plagiarism replaced. The first stadium design, declared too extravagant, scrapped and now the Olympics chief

himself, under formal investigation with just 18 months until Tokyo 2020, many are wondering what's next? Will Ripley, CNN, Tokyo.

(END VIDEO TAPE)

LU STOUT: You're watching "News Stream" and still to come, South Korea has long had strict beauty standards. And now, women are rising up in ways we

haven't seen before. We've got a report on that after the break.

(COMMERCIAL BREAK)

LU STOUT: All right, it's the start of a new week here in Hong Kong, welcome back. This is "News Stream." Now, the ripples of the #MeToo

Movement in the U.S. have touched the hearts of South Korean women in a profound way. It has many of them questioning their role in society and

the strict and longstanding beauty standards that so often seem to be set by men.

And now, they are fighting back. Sort of escaping the corset as it is known there as Alex Field now reports.

(BEGIN VIDEO TAPE)

ALEXANDRA FIELD, CORRESPONDENT, CNN (voice over): In South Korea, she's known as Bae Lina, a YouTube star, part of a generation of beauty bloggers

gaining eye popping followings, showing other women their tips and tricks. This is just part of the two-hour makeup routine she'd turn to every time

she left the house.

[08:40:01]

FIELD: But her real name is Bae Eun-jeong and showing her bare face grabbed more attention than any video she had posted before. The title is,

"I'm Not Pretty." She unmasks herself. She reveals her personal pain and she shares just some of the hate-filled messages she regularly receives.

The viral video has made her face one of the most visible in a growing campaign called "Escape the Corset," a movement that's seen women in South

Korea smashing their makeup and posting the evidence.

Images like this takes aim at South Korea's big bucks beauty industry, the pressure to look perfect making elaborate makeup regimes fashion. But

"Escape the Corset" is more than skin deep.

LEE NA-YOUNG, SOCIOLOGY PROFESSOR, CHUNG-ANG UNIVERSITY: (Foreign language). It's a fundamental resistance movement against women's bodies

and sexuality being consumed only as an object of men's sexual gaze. Fundamentally, you can see it as a challenge to a male-dominated society.

FIELD (voice over): These women are part of a feminist club at their university, like others escaping the corset, they've chopped off their

hair.

KIM MIN-KYUNG, STUDENT: (Foreign language). I feel like my life has become more meaningful.

PARK HYE-RI, STUDENT: (Foreign language). During an exam period, there used to be students with makeup or contacts and students without makeup

would wear masks. Now, it's hard to see a single student who feels she needs that.

FIELD (voice over): The movement stems from a mounting feminist backlash against harassment and assault. Activists say escaping the corset now is

about bringing feminism into women's daily lives.

BAE EUN-JEONG, FORMER BEAUTY BLOGGER: (Foreign language). I made the video because I wanted more women to be free from oppression.

FIELD (voice over): Bae says she's gained time and money from quitting her makeup routine, she is spending it learning new languages, studying

feminism and pursuing a future in acting. For now, she's starring as herself.

Alexandra Field, CNN.

(END VIDEO TAPE)

LU STOUT: Incredible story. Now, finally Cathay Pacific Airlines is dealing with its second airfare mistake. It's the second one in two weeks.

On its website on Sunday, the airline offered first class tickets from Lisbon to Hong Kong for about $1,500.oo. The fare is normally about

$16,000.00. Cathay issued a statement saying it was aware of an error on its website that was caused by an input issue.

Two weeks ago, some tickets on flights from Vietnam to New York were sold for about $675.00 instead of the usual $16,000.00, and yes, as it did

before, Cathay says, it will honor the lower price tickets, as it should. And that is "News Stream" I am Kristie Lu Stout, but don't go anywhere,

"World Sport" with Alex Thomas is next.

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