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Early Start with John Berman and Zoraida Sambolin
Manafort Second Sentencing Today; FAA Sticks with Embattled Boeing Jet; Celebrities Ensnared in College Admissions Scandal; California Putting Death Penalty on Hold; Parliament Rejects May's Brexit Plan; Huawei Tech Used Near U.S. Military Bases. Aired 4:30-5a ET
Aired March 13, 2019 - 04:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
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[04:31:05] JESSICA DEAN, CNN ANCHOR: Paul Manafort could get ten more years in prison today, or a sentence in store as we await Bob Mueller's report?
DAVE BRIGGS, CNN ANCHOR: The U.S. now the only major country where airlines and the government are sticking with the Boeing MAX 8. Turns out that pilots raised concerns after the first crash in October.
DEAN: Celebrities among dozens caught up in an unprecedented college admissions scandal. An elaborate scheme of cheating, bribing and lying.
BRIGGS: And breaking overnight, California putting a moratorium on the death penalty. Why Governor Gavin Newsom is making that move now.
Welcome back to EARLY START, everybody. I'm Dave Briggs.
DEAN: Hi, everyone. I'm Jessica Dean. It is 31 minutes past the hour.
Round two for former Trump campaign manager Paul Manafort this morning. Seventeen months after his indictment was the first in the Mueller probe. Manafort will learn how long he'll spend in prison after sentenced last week for financial crimes, a sentence many thought it was lenient. The 69-year-old Manafort now faces a judge who revoked his bail and threw him in jail last summer.
More now from CNN's Shimon Prokupecz in Washington.
(BEGIN VIDEOTAPE)
SHIMON PROKUPECZ, CNN CRIME AND JUSTICE REPORTER: Good morning, Dave and Jessica.
In just hours, Paul Manafort is back for his final court appearance. Judge Amy Berman Jackson will sentence Paul Manafort for the final time. And she'll sentence him to two criminal charges to which he pleaded guilty to conspiracy against the U.S. and conspiracy for witness tampering. The judge will also potentially consider that he intentionally lied
during his cooperation to investigators, and also when he testified before a grand jury, about his contact with a Russian operative while chairman of the Trump campaign during the 2016 election. The lies ultimately led the Mueller team to throw out the cooperation agreement that they had with Manafort.
In all, Paul Manafort can be sentenced up to ten years total for the two crimes. It was just last week that Paul Manafort got nearly four years in prison. How much more will this judge in Washington, D.C. add to that prison sentence?
Dave, Jessica?
(END VIDEOTAPE)
BRIGGS: Fascinating day. Shimon, thank you.
Countries and airlines around the world grounding the Boeing MAX 8. The U.S., though, stands virtually alone this morning.
Look at this map. In red, you'll see where countries or airlines themselves have decided to ground the plane overnight. Airlines in Russia and Canada stopped their flights. But the FAA says it doesn't see a need pull the MAX 8, despite two crashes that killed hundreds. The agency says our review shows no systematic performance issues and provides no basis to order grounding the aircraft.
CNN's Richard Quest asked the Ethiopian Airlines CEO if the MAX 8s should be grounded.
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RICHARD QUEST, CNN INTERNATIONAL BUSINESS CORRESPONDENT, HOST, "QUEST MEANS BUSINESS": Do you think there should be a worldwide grounding of the MAX planes?
TEWOLDE GEBREMARIAM, CEO, ETHIOPIAN AIRLINES: I think although we don't know -- we don't yet know the exact cause of the accident and speculation is not helpful in either way, but I think there are questions without answers on the airplane.
(END VIDEO CLIP)
BRIGGS: Also new this morning, documents from a federal database were pilots can report aviation issues anonymously, at least five complaints since the Lion Air crash, some saying the nose pointed down while the plane was on auto pilot during departure.
President Trump spoke with Boeing CEO Tuesday to "The Washington Post." Dennis Muilenburg argued to keep the planes in the sky.
But Mr. Trump also tweeted, quote: Airplanes are becoming far too complex to fly. 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. [04:35:00] It's unclear why the president isn't calling on the plane
to be grounded if he thinks they're too complicated to fly.
Meanwhile Boeing stock fell sharply. Shares of the company have fallen more than 11 percent over the past two days. The stock's sharp move cost the Dow 96 points Tuesday.
Despite all this, Wall Street is still backing Boeing. As of Tuesday afternoon, 19 of the 24 analysts following the company had it rated a buy.
DEAN: Family members who lost loved ones on that doomed Boeing jet are now headed to Ethiopia, and they will be demanding answers to some very difficult questions.
Let's go live now to Bole Airport in Addis Ababa and bring in David McKenzie -- David.
DAVID MCKENZIE, CNN INTERNATIONAL CORRESPONDENT: Good morning, Jessica.
Yes, those questions need urgent answer with all those countries and regions grounding and banning this type of plane to fly over it except for U.S. and Canada, as you say. Now, the CEO of Ethiopian Airlines telling CNN that the black boxes are out of the country for analysis. That could provide some early answers.
He said the pilot did have issues with the control system of that plane before it went down, and tragic scenes playing out here today in Ethiopia, with families heading to the scene to try and get some kind of closure.
We spoke to the son of one of those victims on board. You try to keep it together, but it's such a difficult time for him.
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UNIDENTIFIED MALE: (INAUDIBLE) and that will not seize until the battle is done. And also, the entire (INAUDIBLE). Our kin, our beloved (INAUDIBLE).
I really -- I really fear going to that site. I'm not -- I'm not -- I'm not -- I'm not -- how do you say -- I don't do well with this. I really don't have the words. (INAUDIBLE).
(END VIDEO CLIP)
MCKENZIE: I can't imagine how difficult is will be for those families to head to that site after we've been reporting there for several days. They're going to have questions. But those questions might not be answered anytime soon -- Jessica.
DEAN: All right. David, thank you so much.
BRIGGS: All right. Cheat on tests, bribe admissions officers and pretend those payments were for charities, in an unprecedented college admission scheme alleged by prosecutors. Fifty people across six states charged in what they're calling Operation Varsity Blues.
DEAN: Among them, actress Felicity Huffman, seen here in federal court, and actress Lori Loughlin, famous for their roles in "Desperate Housewives" and "Full House." Allegations have witnesses upset, perplexed. The cooperating witness who helped bring them down, the very man who helped the rich and famous pull it off, Rick Singer.
CNN's Brynn Gingras is in Boston.
(BEGIN VIDEOTAPE)
BRYNN GINGRAS, CNN NATIONAL CORRESPONDENT: Dave and Jessica, the mastermind behind this elaborate scheme also cooperated with authorities in their year-long investigation. He actually left the courthouse after pleading guilty to four federal charges and didn't say a word. He could serve up to 65 years in prison.
Now quickly, let me describe how this scheme would operate, according to authorities. They say the parents would pay Singer to help their kids get into elite universities and colleges across the country by one of two avenues -- either academically or through athletics.
If it was academic, he would ask a -- he would hire someone to basically change test scores or to have someone take a test for students with those SATs or ACTs in order to get them enrolled -- admitted, rather, into colleges and universities.
If they went the athletic route, Singer would bribe coaches of athletic teams and get these students admitted through that route as a potential athlete, even if that student never played the sport that they were allegedly being recruited by.
So it was an elaborate scheme which was a case-by-case basis, depending on who Singer was helping out.
Now, we have two names, of course, that everybody has been talking about. That is Felicity Huffman and Lori Loughlin. Both of them, according to authorities, took different routes.
In Felicity Huffman's case, attorneys for the DOJ say that she paid $15,000 to get her daughter's test scores altered. In the case of Loughlin, authorities say that her and her husband paid $500,000 to get her two daughters admitted to USC on the crew team when they never even rowed for a crew.
So again, just elaborate schemes that not only include those two actresses, but we're talking about CEOs of major companies, fashion designers, and a lot of people charged in this case that was dubbed Operation Varsity Blues.
[04:40:02] More people are pleading guilty, we're expecting -- and it's possible that more arrests could come down the line.
And as far as universities and how they're responding, essentially, they are distancing themselves from this. And again, no universities have been charged in this case -- Dave and Jessica. (END VIDEOTAPE)
BRIGGS: Brynn, thanks.
Breaking overnight, California Governor Gavin Newsom just hours after posing a moratorium on the state's death penalty. That means an instant temporary reprieve for 737 inmates, the largest death row population in the nation.
Executive order will not change any current convictions or sentences. And it will not lead to the release of any prisoners currently on death row.
DEAN: California's executions were halted in 2006 when a condemned inmate challenged the state's protocol for lethal injections. In a speech today, Governor Newsom is expected to highlight the racial disparity in sentencing. Six in ten prisoners on California's death row are people of color. Newsom will also cite the cost of enforcing the death penalty and the number of innocent people who have been wrongly sentenced to death.
BRIGGS: Ahead, British lawmakers facing a Brexit deadline with no answers. Is a no deal exit the only way to leave the E.U.? We're live on 10 Downing Street straight ahead.
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[04:45:28] DEAN: How the U.K. exits the European Union is anybody's question at this point. The Brits have just two weeks now to figure it out.
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UNIDENTIFIED MALE: Point of order, the Prime Minister.
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DEAN: Prime Minister Theresa May suffering another humiliating defeat of parliament. Lawmakers voting down her Brexit deal 391 to 242. So, the question is, what happens now?
Hadas Gold joining us live from 10 Downing Street in London -- Hadas.
Hadas?
It appears we've lost Hadas. We're going to try to come back to her just a moment. We'll try to get to is that story in a few minutes.
BRIGGS: All right. Now, some economic news related to Brexit, Nissan ending production of two luxury vehicles in the U.K. Another blow to an industry concerned by weak sales and fears over Brexit. Nissan announced it will stop building the Infinity Q30 and QX30 sport utility vehicle at its plant in Sunderland by the middle of the year. Instead, it will refocus its efforts in China and North America, its largest markets. A spokesperson for Nissan said the production halt was not connected to Britain's departure from the E.U. It's the second time in just over a month the automaker has taken production away from that Sunderland plant.
Meanwhile, trade talks are at a standstill. U.S. Trade Rep Robert Lighthizer told the committee that the U.S. has reached a complete stalemate with the E.U. over agricultural demands. There's also the issue of Trump threatening to slap tariffs on foreign cars. The clock has been taking for President Trump to declare whether foreign cars are a national security threat to the U.S. ever since he received a report from the Commerce Department last month.
DEAN: Let's go back now to 10 Downing Street where Hadas Gold joins us live in London. Hi, Hadas.
HADAS GOLD, CNN BUSINESS REPORTER: Good morning, Jessica.
We are waiting tonight -- we are waiting tonight to hear what will happen with this vote that is coming tonight, about whether a no deal scenario will be taken off the table. This comes just 24 hours after Theresa May had another stunning defeat for her Brexit deal. In a normal situation, the prime minister would have to resign after such a stunning defeat, 75 members of her own party even voted against her.
Tonight, we'll see whether no deal will be taken off the table. Now there does seem to be a majority in parliament for that scenario, because most people don't want to see the U.K. crashing out of the European Union without any sort of deal in place. If that deal passes, then tomorrow, we'll have another vote about whether the deadline will be extended. That will have to happen if they want to leave the European Union with no deal because as we all know, we only have two weeks until that March 29th deadline.
But beyond the political and bureaucratic message, it's creating there are real people's lives affected by this. The government has warned that things like medication that drug companies need to stockpile, six weeks' worth of drugs in the event of a no deal scenario. People are very, very worried that some drugs that they need, everything from cancer to pain killers they won't be able to get in time.
Just this morning, the U.K. government released information on how they would deal with tariffs in event on a no deal. Included on that is a 10.6 percent tariff on cars. That would increase the price of a car to be sold in the United Kingdom by nearly $2,000. So, these are real things affecting real people. They're looking at it and they say they have no idea what's going to happen in the next few days, Jessica.
DEAN: A lot of questions there.
All right. Hadas Gold, thanks so much.
BRIGGS: The Chinese tech giant Huawei under increasing pressure this morning. Federal prosecutors filed charges, claiming the company steals U.S. trade secrets. And on Monday, CNN reported its technology is deployed by small
wireless carriers. Many of them are the only providers of cell coverage in rural areas close to U.S. military bases.
Huawei's CEO spoke to Matt Rivers. He joins us now from China.
Matt, good morning.
MATT RIVERS, CNN INTERNATIONAL CORRESPONDENT: Good morning.
And this is a very rare interview. This company has been very secretive over the years but they're talking now because their very existence is under threat by the United States. And they've taken a concrete step just recently. It was just last week that they filed a lawsuit against the United States because the U.S. has banned Huawei products from being used in federal agencies.
[04:50:00] Huawei says that's unconstitutional, and they're asking the U.S. courts to take a look at it.
And this interview was the first time that the CEO, or the founder of the company has spoken to the media since then. He's basically told me, look, this is a counter attack against the United States. This is us going to the U.S. saying this is unconstitutional. You're not telling the truth when you're telling countries around the world that we're a national security threat and we're going to fight you in court.
The other message they're sending here is to other countries. Huawei isn't really in the U.S. market but they do sell to places like Germany, for example. You had the U.S. tell Germany just this week that if they installed Huawei products in any government agency, the U.S. would limit intelligence sharing between the two countries.
So, what Huawei is saying in this lawsuit is countries like Germany, U.K., New Zealand, our products are safe. Don't believe the U.S. But whether this lawsuit actually changes anything, Dave, I don't think it will.
BRIGGS: And how if at all, Matt, this plays into the negotiations between the U.S. and China on that trade deal, major implications here.
Matt rivers live for us there in China this morning -- thank you.
All right. Ahead, Disney's takeover of 21st Century Fox will take affect later this month, changing the entertainment industry as we know it. Details in CNN Business, next.
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[04:55:43] DEAN: A former Florida cop is accused of using police databases as his personal dating service. An internal investigation found former Bradenton Police Sergeant Leonel Marines has targeted women since 2012 using his position to approach them for dates. The 12-year veteran was pulled off the patrol duty and resigned last fall. Officials say he was caught after allegedly following a woman home. Messages left by CNN on Marines voicemail have not been returned.
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RUSSELL WESTBROOK, POINT GUARD, OKLAHOMA CITY THUNDER: You think I'm playing? I swear to God. I swear to God. I'll (EXPLETIVE DELETED) you up -- you and your wife. I'll (EXPLETIVE DELETED) you up.
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BRIGGS: There is fallout this morning from Russell Westbrook's heated exchange with a fan in Utah. That fan Shane Keisel has been given a lifetime ban by the Jazz. The team says the punishment was determined after an investigation using video, evidence and eyewitness account.
Westbrook said he heard Keisel directing racist comments at him. Keisel claims he told Westbrook to sit down and ice your knees bro. The NBA has fined Westbrook $25,000 for using profanity and threatening a fan.
Sometimes truth is just plain weirder than fiction. In Sandwich, Massachusetts, over the weekend, a woman escaped serious injury after her car hit a turkey. Again, that's in the town of Sandwich. Police say the bird crashed through the windshield of her KIA SUV, continued through the vehicle and slammed into the rear tailgate.
The driver sustained minor injuries. The Turkey unfortunately did not survive. No word on whether it was used to make, you know -- well, a sandwich.
DEAN: Uh-huh, uh-huh.
So, who's the most popular person in New Jersey? Could be this guy, well, the billboard. Chris Perry getting thousands of birthday wishes thanks to his two sons, who bought this billboard as a prank for dad's 62nd birthday.
The giant sign went up last week. It can be seen on the way to Atlantic City's casinos. Within minutes, it began with texts from strange numbers and when CNN attempted to reach the birthday boy, his voice mail was full. So, hopefully, he changed his number.
BRIGGS: And bought him a new phone for his birthday with a new phone number.
All right. Let's get a check on CNN Business this morning.
Global markets lower and fresh concerns over Brexit. Asian markets closed lower. European markets opened lower. Brexit concerns carrying over to the U.S. Wall Street futures pointing lower. Stocks closed mixed yesterday.
The Dow closed down 96 points as more countries said they would ground Boeing's 737 MAX planes. Shares of Boeing have fallen. More than 11 percent over the past two days. According to Bloomberg, Boeing has lost $24 billion in market cap in two days. The S&P 500 both closed up just slightly. Wells Fargo CEO Tim Sloan says the bank's problems are fixed and its
customer abuses are thing of the past. But many lawmakers appear unconvinced. Tim Sloan faced a bipartisan grilling Tuesday and tried to convince Congress Wells Fargo has abandoned the aggressive sales tactics that led to the creation of millions of fake accounts and other issues.
Chairwoman Maxine Waters said he's not been able to keep the bank out of trouble and asked if it should be downsized. Sloan said this.
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TIM SLOAN, CEO, WELLS FARGO: I think the way in which we serve our customers is reflective of the changes I've made since I've become CEO.
(END VIDEO CLIP)
BRIGGS: The Federal Reserve still has an asset cap on Wells Fargo for widespread consumer abuse. The cap keeps the bank from expanding.
Disney's takeover of 21st Century Fox will take effect later this month, changing the entire entertainment industry as we know it. The $71 billion deal to buy most of 21st Century Fox will take effect on March 20th. Disney is picking up the studio, a controlling stake in Hulu, a suite of entertainment channels like FX and Nat Geo and other assets.
The remaining parts of 21st Century Fox will be spun off in a new company simply known as Fox. It will include the Fox Broadcast Network, Fox News and Fox Sports.
Staffers of the 20th Century Fox studio now bracing for layoffs. The company has not commented on the specific plans. Analysts expect Disney will lay off at least 5,000 people.
