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FBI Breaks Scheme to Get Kids into College; Sen. Maggie Hassan (D) New Hampshire is Interview about Impeaching Trump; Call to Ground Boeing Planes. Aired 1-1:30p ET
Aired March 12, 2019 - 13:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[13:00:00] ABBY PHILLIP, CNN WHITE HOUSE CORRESPONDENT: This is the frame that Trump folks are looking at this. Paul Ryan failed on a major issue but Republicans want to run on tax reform.
JOHN KING, CNN ANCHOR: And it's a continuing debate about the party after Trump, even as we still have Trump. Ryan trying to weigh in on that.
Thanks for joining us on INSIDE POLITICS. See you back here tomorrow.
Brianna Keilar starts right now.
BRIANNA KEILAR, CNN ANCHOR: I'm Brianna Keilar, live from CNN's Washington headquarters.
Underway right now, a stunning cheating scandal involving famous actresses, coaches and administrators at major elite universities, all accused of paying and accepting millions of dollars in bribes to get kids into college.
Another week, another internal battle in the Democratic Party. Today's debate, is impeaching Trump worth it?
Plus, if Joe Biden's running for president, his speech today may have been his unofficial kickoff. See what happened.
And as more and more countries ground the Boeing jets involved in deadly crashes, why isn't the U.S. and what can passengers do?
We begin with breaking news. Wealthy individuals accused of using their money to buy their kids' way into college. Federal authorities say they have charged 50 people in the largest college admissions scam ever prosecuted by the Justice Department. And those facing charges include coaches, college exam administrators, as well as CEOs and celebrities. Academy Award Nominee Felicity Huffman and "Full House" actress Lori Loughlin are both charged in what prosecutors describe as an elaborate scam.
(BEGIN VIDEO CLIP)
ANDREW LELLING, U.S. ATTORNEY FOR MASSACHUSETTS: A central defendant in the scheme, William Singer, will plead guilty today to charges of racketeering conspiracy, money laundering conspiracy, conspiracy to defraud the United States and obstruction of justice. Singer allegedly ran a college counseling service and something called the Key Worldwide Foundation. Between roughly 2011 and 2018, wealthy parents paid Singer about $25 million in total to guarantee their children's admission to elite schools including Yale, Georgetown, Stanford, the University of Southern California, the University of Texas, UCLA and Wake Forest.
(END VIDEO CLIP)
KEILAR: Now, those arrested include two administrators of the SAT and the ACT tests, one exam proctor, nine coaches at elite schools, one college administrator and 33 parents.
National correspondent Brynn Gingras is in Boston, where prosecutors made this announcement. We have former MIT admissions counselor McGreggor Crowley, who is also with us, along with business law attorney Seth Berenzweig.
Brynn, first just walk us through how this elaborate scheme worked.
BRYNN GINGRAS, CNN NATIONAL CORRESPONDENT: Yes, elaborate and enormous, Brianna. I mean you just described it right there as far as how big this was. Investigators were looking into this for the last year. They called it Operation Varsity Blues. The mastermind, they say, behind it was a man named Rick Singer, and he is expected to be in court and plead guilty, according to authorities, within the next few hours or so.
What the DOJ says, Singer set up two plans basically to help these parents get their children into elite universities. One way they could do that, according to these court documents, was basically parents would have Singer take -- have someone take tests for them, the ACTs, the SATs, and actually physically take those tests in order to obtain a better score. Another case, he would have someone who would change the scores in order to bring up their SAT scores or ACT scores for admission tests into these college universities.
And a separate way that parents would basically hire Singer was to go through the athletic route, basically, according to authorities, Singer would bribe athletic officials, coaches, give them money and they would basically admit a student into their school as an athlete, even if that person never played a sport.
Just incredible details coming out of this news conference that wrapped up about an hour ago.
Now, you named two famous actresses, Felicity Huffman and Lori Loughlin. They basically, each of them, allegedly took these separate routes with their daughters. Felicity Huffman allegedly paying $15,000 to get one daughter's test scores changed in order to get a better SAT score. As far as Lori Loughlin is concerned with these court paperwork, she asked Rick Singer to basically get her daughter admitted to USC by posing as a crew student -- athlete, rather, even though she never played crew.
So, again, just a lot of detail. But we're not just talking about actresses. As you said, there are CEOs. There are a lot of famous people on this list. And a lot of them have been arrested. So far others waiting to turn themselves in. Authorities say this isn't the end of it. The investigation is actually still ongoing, Brianna.
KEILAR: Yes, and we'll see how -- we'll see how many. That's also the question here.
So, Seth, tell us about the charges here.
SETH BERENZWEIG, BUSINESS LAW ATTORNEY: So this is really essentially a two-stage criminal complaint. In the first stage, Mr. Singer was offering a two-path scheme where he could get your kid in with a critical conspiracy either through rigging the game with you ACT or SAT scores, or he also had connections with elite schools with coaches and assistant coaches where you could create a scam to get someone into a sporting avenue into the school through fraud, and they would literally PhotoShop pictures over other athlete's bodies. It was just very bold and outrageous.
[13:05:38] And not only was that not the complete fraud, but also at a second level they laundered the money through a sham enterprise, a non-profit organization. So it wasn't enough for these defendants to allegedly commit academic fraud to bounce out qualified kids, but then they looked to take a tax deduction for a charitable deduction at the end of the day as well.
KEILAR: So that's tax fraud, right?
BERENZWEIG: It's tax fraud.
KEILAR: Racketeering, money laundering, obstruction.
BERENZWEIG: RICO. You got it.
So I think you're pointing to another key point here. This is a huge day. But this is just the beginning. This is a criminal complaint. It's not an indictment like what we're used to seeing like with Manafort and so forth.
What that means is that these individuals have the right to appear before a judge. They're under arrest. They're going to go in front of a judge. And either they're going to not waive indictment, which means they're going to be pelted with all these kinds of high-level felonies in a much broader case, or they're going to plead it out.
On the charges that they're facing right now, it's -- they're already facing 20 years. So you're going to see a lot of people fall like flies, I predict.
KEILAR: McGreggor, you are an expert in college admissions. You were an admissions counselor at MIT, one of the country's most elite universities. Had you heard of something like this? And, if so, did you ever have a sense of how widespread this problem is?
MCGREGGOR CROWLEY, FORMER DIRECTOR OF SELECTION, MIT: I've never heard of anything like this ever happening. I mean it's a -- it's -- it's really a travesty. I think for me the biggest travesty here is that a number of -- it sounds as if from the indictment, a number of -- of the children involved here, and that's in and of itself is awful, but received fake diagnoses of learning disabilities, dyslexia, attentional issues. And as a pediatrician and an admissions officer, I think that's just -- it does an awful disservice to the kids who actually have those disabilities and who need the extended time and the accommodations in order to show their potential on these standardized tests.
KEILAR: I can -- I get a sense of how heavy this subject is to you as you are seeing something that you never even knew existed. What do you think about the students who have worked hard, do not get in, and they hear about this?
CROWLEY: I think it just underscores how overall unfair the process is. You know, many admissions officers hope to embrace a really meritocratic process of selection where they admit the best students to that college or that university. But, in reality, there's just a significant amount of forces and -- that student just don't know about that take place that go into effect in the selection process that really doesn't make it as meritocratic as they hoped it would be.
KEILAR: So I wonder, because we know, McGreggor, that there's certainly this perception that there are people who will donate, right, to universities or maybe they're an alum and they're doing that to try to curry favor for their child. Is -- how real is that and isn't that already an opportunity to take advantage of the system, and how do you see that different from this?
CROWLEY: I think it's an excellent question. I think one of the processes that many people don't know about is that there's -- many universities have a development office that deals directly with families, donors, alumni, and then there's the admissions office. And there's some pretty substantial barriers that exist between the two so that decisions don't take into account, you know, whether family can donate or has donated. But, you know, you see the name on a building, you see the name on an application and sometimes it's sort of an implicit decision that takes place.
But, I think, you know, there are ways to do this and there are ways to not do this. And this, to me, is just -- it's just exceptionally unethical. And I'm -- I think it's going to end up being larger. It sounds like it's going to be larger than what was discussed today. And I think it's going to do a lot of harm to schools, to admissions offices, because now they're going to have -- the onus is on them to show that this is a fair process or as fair as it can possibly be.
KEILAR: All right, McGreggor Crowley, thank you so much.
Seth Berenzweig as well, thank you for your legal expertise.
Freshman Democrats supporting the impeachment of President Trump are now responding to their party leader, Speaker Nancy Pelosi, who's saying that President Trump is not worth it.
Plus, former Vice President Dick Cheney giving the clearest indicator -- or Joe Biden, pardon me -- lots of former vice presidents we're talking about today. Anyways, Biden giving the clearest indication yet that he may join the 2020 race. See what happened with the crowd at his speech.
[13:10:10] And the calls are growing louder for Boeing to ground the jets involved in two deadly crashes. What do you do if you're about to fly on one?
KEILAR: There has been plenty of reaction on Capitol Hill today to House Speaker Nancy Pelosi, who says she's not ready to support a push for impeachment. In a recent interview, Pelosi said that right now it's not worth the division or the chaos that it would create. But did she leave the door open to the idea in the future, saying that if this equation changes, she says, there's something so compelling and overwhelming and bipartisan. Now, Democrats say that's why they're continuing the oversight process with several investigations in play.
[13:15:07] And here's some of the reaction today to Pelosi's comments.
(BEGIN VIDEO CLIP)
REP. HAKEEM JEFFRIES, DEMOCRATIC CAUCUS CHAIRMAN: I agree that we have to proceed with caution, and that is the position of the overwhelming majority of the members of the House Democratic Caucus.
UNIDENTIFIED MALE: When public opinion is in support of removal, I'm confident that the impeachment will go forward.
REP. ADAM SCHIFF (D), CHAIRMAN, INTELLIGENCE COMMITTEE: I think the speaker is absolutely right that if the evidence isn't sufficient to win bipartisan support for this, putting the country through a failed impeachment is not a good idea.
MANU RAJU, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Do you agree with that, not pursuing impeachment?
REP. JOAQUIN CASTRO (D), TEXAS: At this time, yes. And we don't have the Mueller report yet. I think you've got to wait to see what's in that report.
REP. RICHARD NEAL (D), MASSACHUSETTS: Safe to say that if the speaker has indicated that she doesn't favor that course of action, then it's not going to happen.
(END VIDEO CLIP)
KEILAR: So clearly we're trying to see what Democrats think.
And we have Senator Maggie Hassan, a Democrat who represents New Hampshire, joining us today.
You sit on the Senate Homeland Security Committee. And we really appreciate you being with us. Thank you.
SEN. MAGGIE HASSAN (D), NEW HAMPSHIRE: Thanks for having me, Brianna.
KEILAR: When you -- do you agree with Speaker Pelosi that impeachment is not worth it for Democrats?
HASSAN: Look, I have long said that President Trump's rhetoric and actions render him unfit to be our president. That being said, I think we really need to see the special counsel be allowed to complete his investigation, issue his report, see what it says and review that report with the understanding that the decision to go forward with impeachment is a really significant and grave one and it's not something we should do lightly.
KEILAR: There is a scenario where -- I mean it is possible to imagine that the Mueller report does raise some issue of major crimes committed, but perhaps Republicans decide that they are going to stand by the president. I wonder if you think, in that case, is there a duty on the part of Democrats to pursue impeachment if the president has committed significant crimes even if it may be a political disaster for your party?
HASSAN: Again, I think it's really important just to see what the special counsel finds and proceed from there. But I do think it's really important that we always evaluate whether to go forward with the overall impact that decision would have on our country.
KEILAR: And what do you mean -- the overall impact meaning?
HASSAN: Well, how divisive it would be. And certainly, you know, it -- we are going to have to see whether -- if the Mueller report really substantiates criminal behavior or impeachable behavior, what the reaction of our Republican colleagues are.
HASSAN: I understand the concern people bring about protecting the Constitution, but I also think we have an obligation to work together as Americans to move our country forward. And that's one of the things that you have to balance in this overall discussion.
KEILAR: So you're -- being from New Hampshire, you know you can't really throw a rock there without hitting a presidential candidate. And former Vice President Joe Biden teased his future in that regard a bit this morning. He told a cheering crowd here in Washington that were -- they were rather energetic and he said he may need their energy in a few weeks. Would you support a Biden candidacy?
HASSAN: Oh, look, I -- I think Vice President Biden has a great case to make to the American people. And I think we also have a really robust and excellent group of candidates in the field right now. My job in New Hampshire is to make sure we have the welcome mat there and make sure that we are vetting all of these candidates.
What I know about the vice president and what I know about our candidates is they're going to fight for working families and make sure we have an economy that works for everyone. And that's really what this election cycle is going to be about. KEILAR: So despite -- And I want to talk to you now about the
president's budget --
KEILAR: Because despite his promises to protect Medicare, his budget would cut billions of dollars from the program.
KEILAR: $845 billion from the program. And it also makes deep cuts in Medicaid, it cuts Social Security.
You're on the Senate Finance Committee. The dollar amount, surely -- this -- you know, this is a wish list. It's not going to stay the same when all of this is said and done. But, just, what's your reaction to the president as he does make his priorities clear here, posing any cuts to Medicare?
HASSAN: Well, look, this is something the president said he would never do when he was running for office. He said he wouldn't cut Medicare. He said he wouldn't cut Social Security. And his budget proposes significant cuts to both.
You know, there are a couple of things in this budget that I appreciate. One is that he has kept level critical funding for substance misuse, you know, anti-opioid epidemic grants. That's good. There's more increased funding for cybersecurity. That's good. But, overall, this is a really fiscally irresponsible budget that will take us backwards. In addition to those cuts to Medicare that you talk about and Social Security, deep, deep cuts to Medicaid and the ending of Medicaid expansion, which is one of the critical tools that people on the front lines of the opioid epidemic have at their disposal and tell me how that is critically important to them all the time.
[13:20:22] So, on the one hand, the president is maintaining some opioid funding, but when it gets to the health care system that can really help us in that regard, this budget takes us very far backwards. It also would allow, again, insurance companies to discriminate against people with pre-existing conditions. So, again, leaving more Americans uninsured, adding to all of the costs that come with that.
So, at the end of the day, this is a really irresponsible budget in which the president is also breaking promises he made to the American people. What we know we need to do is build a stronger, more effective health care system that brings the cost of health care down but makes sure that we're expanding coverage to everybody.
KEILAR: The budget does keep a key promise, which I know really matters in your state, and that is money to combat the opioid epidemic. You mentioned it there.
KEILAR: I mean that is something, among a few other of the proposals in here, that you look at and say you can get behind, right?
HASSAN: I can get behind that. But if you go ahead and keep the money to fight opioids specifically targeted for opioids and undo -- and you end Medicaid expansion, you're undermining the whole effort because Medicaid expansion covers substance use, disorder, treatment. And so it's absolutely critical. You take that away, and you're going to have more people again who can't access treatment. So the two things are contradictory.
I can support and appreciate the targeted opioid money staying the same, although obviously we could use more, but it really is -- isn't going to be very effective if they end Medicare expansion and cut and cap traditional Medicaid. So, overall, this is a very backward budget and it's going to undermine critical health care services for millions of Americans.
KEILAR: I want to ask you about something "The Washington Post" is reporting, some details from a Republican retreat this past weekend where the former vice president, Dick Cheney, took the current VP to task for the administration's foreign policy. Cheney told Vice President Pence that allies were losing confidence in the United States and he also said that the Trump foreign policy aligns closer to Barack Obama than Ronald Reagan.
What is your reaction to that?
HASSAN: Well, we have never seen a more damaging foreign policy than what we are seeing with Donald Trump. He is cozying up to our adversaries like Putin and Kim Jong-un --
KEILAR: But will you give, from your perspective, do you -- do you agree with Dick Cheney and -- do you agree with Dick Cheney?
HASSAN: I -- well, what I agree with is comments that say that Donald Trump's foreign policy is very dangerous. It's rash. It's impulsive. He puts the word of foreign adversaries, like Putin, ahead of the word of our own intelligence professionals. He decides, without consulting the military or intelligence, to suddenly pull out of Syria. And has no strategy or discipline when it comes to foreign policy. That is very harmful and very dangerous.
KEILAR: All right, Senator Maggie Hassan, thank you so much for being on.
HASSAN: Thank you very much for having me on.
KEILAR: The list is growing longer and longer. More countries banning a type of Boeing plane involved in two deadly crashes, as pressure mounts on the United States to make a move and ground planes.
[13:28:29] KEILAR: The calls to ground all Boeing Max 8 planes is growing ever louder. More than 10 countries, including the United Kingdom, have now either grounded the planes or banned them from their air space following the Ethiopian Airlines crash that killed all 157 people on board. The CEO of Ethiopian Airlines said the pilots radioed that they were having flight control problems before the plane went down.
Here in the U.S., Senators Elizabeth Warren and Mitt Romney -- could you find two people more apart -- are some of the lawmakers who have called on the FAA to order the plane's parked. The FAA says it has, quote, full confidence in the plane. Well, the two airlines that fly the Max 8, Southwest and American, say they have not seen any evidence that would make them think the planes are not safe to fly. President Trump also weighing in a short time ago saying in part, airplanes are becoming far too complex to fly. Pilots are no longer needed. The complexity creates danger. All of this for great cost yet very little gain. I don't know about you, but I don't want Albert Einstein to be my pilot. I want great flying professionals that are allowed to easily and quickly take control of a plane.
Just two weeks ago in Vietnam, the president trumpeted the sale of 100 Boeing Max 8 planes -- Max planes to a Vietnamese carrier.
Dennis Tajer is with me now. He is a 737 pilot for American Airlines and he is the spokesman for the Allied Pilots Association. The Flight Attendants Association says that it wants the FAA to step in.
[13:30:01] Dennis, should these planes, as the Flight Attendant's Association says, should they be grounded right now?