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Manafort Protege Rick Gates Could Testify Today, Monday; Judge Calls Government Proposal for ACLU to Track Down Deported Parents "Unacceptable"; Air Marshal And Screenings Possible TSA Cuts. Aired 4:30-5p ET

Aired August 03, 2018 - 16:30   ET

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

ERICA HILL, CNN HOST: We're back with the politics lead.

Prosecutors in the trial of ex-Trump campaign chair Paul Manafort making their case the 69-year-old is a tax cheat who engineered an elaborate scheme to hide millions in income.

[16:30:08] The government's star witness, Manafort's long-time business partner and protege, Rick Gates, could take the stand at any moment.

CNN's Evan Perez has been in the courtroom for us today.

So, Evan, we heard from Manafort's accountants today. What more did they reveal about his financials?

EVAN PEREZ, CNN JUSTICE CORRESPONDENT: Well, Erica, the two accountants that testified today both said that they did not know about these foreign bank accounts that Paul Manafort had in Cyprus and other countries. They said they knew that they were these foreign entities, but they thought they were clients and that's where the money was flowing in from. Not that these were bank accounts that the government says Paul Manafort controlled.

We also heard from the first witness, the first witness that's been given immunity in this case. Cindy Laporta is one of the two accountants who was testifying today and she was testifying about how her company and people who work with her fudged loan numbers essentially, faked loan numbers in particular, one $900,000 loan in the tax year for 2015. And she says quote, I very much regret it. This was done she says at the request of Rick Gates who was working alongside Paul Manafort.

And really, the reason why she said she did it in order to help Paul Manafort reduce his taxes in 2015 was because Paul Manafort was a very important customer.

HILL: Very important customer.

Well, meantime, of course, the anticipation is building as we all wait for Rick Gates to take the stand. Questions about what he might say. Of course how the defense may grill him.

What are we expecting from his testimony, Evan? PEREZ: Right, absolutely. It is -- all of this is building towards

Rick Gates.

Now, Cindy Laporta, and we're going to hear probably from a couple more people who worked in the accounting firm who are going to testify that they were part of this conspiracy and that's where Rick Gates comes in. We may hear from him at any point perhaps Monday.

But here's what we expect him to say. We expect him to say he was part of this conspiracy with Paul Manafort to deceive the IRS, to hide these bank accounts he had overseas. And we very much of course expect that a Paul Manafort's attorneys are going to point out to the jury that Rick Gates has pleaded guilty. He pleaded guilty to lying to the government as part of this investigation.

Of course, now, Rick Gates is now testifying for the government so he's definitely changed his tune. We expect that's going to be a very fiery day on the stand for Rick Gates -- Erica.

HILL: Evan Perez with the latest -- thank you.

Breaking news. A judge blasting the federal government for trying to get the ACLU to reunite hundreds of children, children that the government separated from their parents.

(COMMERCIAL BREAK)

[16:37:20] HILL: Breaking news in our national lead. A federal judge moments ago slamming the Trump administration over their latest proposal to reunite hundreds of immigrant families, calling it unacceptable and adding: The reality is that for every parent who is not located, there will be a permanent orphaned child, and that is 100 percent the responsibility of the administration.

Which is interesting because this comes after the Justice Department suggested that the ACLU, and other advocacy groups, should find the parents of more than 500 children who remain in government custody. Remember these are children who were separated because of the president's zero tolerance policy.

CNN's Dianne Gallagher joins me now.

Dianne, you've been listening on this hearing and the judge is not mincing words.

DIANNE GALLAGHER, CNN CORRESPONDENT: No, not at all, and not afraid to assign blame in this case either, Erica. The judge slammed the government essentially for offering nothing when it comes to a plan, saying that at some point, by Thursday, next Thursday, they need a point person, they need somebody who is a commander of some sort to take the lead and find these parents who were deported after being separated from their children by the government.

Now, he said that the ACLU and other organizations, it's good to help because this is a serious problem. He called it the highest stakes in this entire crisis at this point. But he made sure that he placed the blame and the responsibility solely on the Trump administration.

(BEGIN VIDEOTAPE)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Families are being separated --

GALLAGHER (voice-over): The Trump administration telling the ACLU essentially, we broke it, you fix it. In documents filed ahead of a hearing this afternoon, the Justice Department argued the ACLU should use its, quote, considerable resources, its network of law firms, NGOs, volunteers and others to find parents who the government separated from their children and then deported without them, even suggesting that the ACLU be required to share weekly updates about their progress locating parents and whether those parents want to be reunited with their children.

Making this even tougher, the government has resisted handing over entire case files for these parents, something ACLU says would help expedite the search.

LEE GELERNT, ACLU: You know what's unfortunate, the government doesn't have a plan the government's shifted the responsibility to us and NGOs to find these parents. We'll do it because the government is not, but what we need is information from the government. Any relative the government may know about, any last known address something to help us. We're not going to give up.

GALLAGHER: It's not a small task. In a Senate hearing this week, Public Health Service Corps Commander Jonathan White said the parents of more than five hundred kids still here may have been deported. But some of those children have been released to sponsors or relatives, but 410 of the separated children with parents no longer in the country remain in government custody.

[16:40:06] Meanwhile, each week seems to bring new allegations of abuse at shelters for migrant children. Court records first reported by "ProPublica" reveal that a former youth care worker for Southwest Key, Levian Pacheco, is accused of molesting eight boys ages 15 to 17 who were staying at the Mesa, Arizona shelter where he worked between August 2016 and July of last year. Pacheco denies these allegations.

Now, on Tuesday, another man, an employee at a Southwest Key children shelter in Phoenix was arrested on suspicion of molesting a 14-year- old migrant girl who was staying at the facility. The spokesman told CNN, quote: Southwest Key programs does extensive work to prevent all forms of abuse. When these rare situations occur, all staff involved adhere to our strict protocols.

(END VIDEOTAPE)

GALLAGHER: So how widespread is abuse like this? Well, the truth is we don't know.

Last week, "ProPublica" released an investigation, Erica, where they were able to obtain police records and phone calls and reports for 70 of the roughly a hundred of these type of facilities that house migrant children.

They had 125 calls, at least, that reported regarding sexual offenses in a five-year span, and again, that's not the entire picture, and it doesn't take into account those who are afraid to say anything about what may be happening to them.

HILL: All right, Jane Gallagher with the latest there -- Dianne, thank you.

The judge, strong words, this is 100 percent their responsibility when talking about the Trump administration, Laura. I mean, do they have any sort of good legal argument here?

LAURA JARRETT, CNN LEGAL ANALYST: Well, the idea that you're going to farm out justice or have somebody else carry out the responsibility of the government is shocking. We didn't shift the burden of proof in a criminal court of law. We don't shift the burden of trying to correct what you've done wrong through policy implementation.

What they're really basing it on here is this concept that's not really quite in the Constitution, the idea of familial integrity, being able to have your family associations together. And that is the argument of the ACLU and those who are supporting the reunification of migrant children who are separated from their families.

The idea here is about due process. When you're talking about separating families and children from their parents, it's about you cannot deprive them of life, liberty, pursuit of happiness, or even familial association without due process and giving them a chance to have that. We wouldn't do it in an abuse case of an American citizen child. You'd have to have a termination of parental rights, which is a very lengthy process.

And the idea here, you're denying them due process and you're them denying equal protection of the laws you would otherwise extend to a citizen of this country. And the Constitution of the United States does not refer to citizenship at all really. You talk about persons, if you're in the United States, you get the protections. There is a strong argument that they must reunify legally.

HILL: What's remarkable too, and really on a couple of levels -- so, sticking with the legal argument here is the fact that they're trying to pass off -- the government is trying to pass off its own mess that it created. I mean, there is no denying that on the ACLU and say here, you clean up the mess that I made, and there's a question of the legal standing on that.

But also now, the ACLU, as we know, the judge is saying, listen, you should come up with a plan to put together a steering committee. Is that the right way to move it forward, even legally, Laura?

COATES: Collectively, if you can have a solution to an urgent need --

HILL: Right.

COATES: -- the courts want to facilitate that. But if it's a game of hot potato, where they're both saying, no, it's not problem and you do it, no, you do it, that child cannot become that hot potato.

HILL: Right.

COATES: But if there is a way to facilitate reunification and to allow the ACLU to rely on the information there, but the problem here they're talk about as you're saying was the legal hurdle of giving over private information because they do have privacy interests about giving the names of children, the names of family members, et cetera. But this seems to me like a very -- on a cost benefit analysis, you go for reunification, either there's a small interest.

RICH LOWRY, CNN POLITICAL COMMENTATOR: I think this is being misrepresented a little bit.

JOAN WALSH, CNN POLITICAL COMMENTATOR: They don't care about anything. They don't care about anything having to do with the rights of these parents or these children, except that they're going to protect their privacy rights which is so outrageous.

And the other thing is, let's leave aside the legality issue, the ACLU, RAICES, all of these groups at the border, are working their tails off, sometimes with volunteer money to do these reunifications. It's not that they're not trying. They really do want to be part of a solution as Laura says, if that's the best way to do it.

But they need information. They need funding. They're literally doing it. Volunteer lawyers are going to the border to try to accomplish these reunifications. It's just so heartbreaking and so despicable.

LOWRY: I don't think the government is literally washing its hands and saying, ACLU, you do it. They're saying, ACLU, please help us.

And one of the reasons the separation policy is such a fiasco is once you separated the parents and the children, the children are an entirely different legal and bureaucratic track because they're technically then unaccompanied. And you literally cannot under the law separate them one day and the next day reunite them. You need to do like a 50-day waiting period to do FBI checks.

So it's an insane system. Everyone should be trying their hardest to put these families back together. And Congress to actually have a rational policy at the border should change the law under various rules that prevent us just from holding families together, adjudicating whatever legitimate asylum claims there are and then deporting them together if those claims don't pan out.

[16:45:00]

HILL: We should -- I see there are multiple issues but what you just laid out, yes, these are all of that a number of the issues. It didn't have to happen in the first place. It's a plan that was not well thought out. There was no planning period. There were people who didn't have any information. We didn't know who they were. This is all a big issue. And now we have -- so 572 children because as we're talking about this becoming a hot potato, we're talking actually about 572 children and their families. They are still in custody. 410 of those children have parents that are outside of the United States. What's remarkable is DHS Secretary Kirstjen Nielsen has said repeatedly no parents were deported without first being given the option to take their children with them.

WALSH: This is not true.

HILL: Are we supposed to believe that all 410 of these children, the adult the parent who is with them, all 400-plus of them elected to say yes I'll leave without my kid.

(CROSSTALK)

LOWRY: But remember, these parents, these Central American kiddies -- countries send their children unaccompanied in many cases.

HILL: These are not --

LOWRY: I know. But if you give some of them a choice, you're going to be deported with your kid or your kid can stay in the United States, some of them will all say --

HILL: I get that but do you really believe that there are 410 of them.

WALSH: No, we have -- we have so many examples of lawyers saying my client was told the way to get your kid back is to waive all your rights and say yes I'll be deported and then they don't get their child back. This is documented hundreds -- dozens, I shouldn't say hundreds. Dozens of these cases are documented by the law -- the attorneys for these families, these families. These parents were lied to and then their children are being abused, not all of them but some of them are being abused in our custody. And they're throwing it back on the ACLU like it's the ACLU, that's just ---

LOWRY: Why wouldn't the ACLU want to help?

(CROSSTALK)

HILL: It's not the ACLU saying we don't want to help. They (INAUDIBLE) there, as Joan point out, they've been -- you know, we've all -- we've all talked about. We've all covered it whose they're trying to help out. It's the fact that of the government coming forward and saying hey by the way -- which we've heard for some time we created this problem trying to pass it off, where there first it was what Congress needs to do something or there are things that can be done.

LOWRY: The Congress are not trying to reunite them. I mean the State Department isn't in touch with these embassies. It is trying to track down these people but they -- these are the clients of the ACLU, the ACLU wants to reunite them as we all do so help out.

LAURA COATES, CNN LEGAL ANALYST: They do want to help. I think the issue that they're facing is the idea of if you create a situation where you make -- have someone have to go through Herculean efforts to get the job done and then you refuse to extend the information that would accomplish that measure then how can they possibly help. I think the real issue here is the court just as they set a deadline for unification, they look at the -- they don't think they thumb their nose at that deadline but you haven't been all in your power to actually create the situation they can actually unify.

Therefore you cannot simply pass off the buck to somebody else without giving all the information there. But I don't think it's a matter of complete and total indifference on behalf of the government in some capacity and the ACLU not wanting to help for the court they're looking at it and saying we have a problem, I'd like to facilitate a solution, everyone has to play their part, and the government you have the greater onus because you created the problem so hand over information. And I have a mother, I just don't believe that there is 500 sets of parents or parents who said you know what, go ahead and take my child --

LOWRY: Do you believe -- do you believe that parents will send their children through a desert for five days unaccompanied to get to the United States, do you believe that happened?

COATES: I know, I know that it happened --

LOWRY: It does happen.

COATES: But I also know what happens is that they're -- in America, we have an asylum process that was not adhered to for many people given a false narrative of who comes the country --

LOWRY: But the concern is these families are so desperate to get their kids to the United States they'll sometimes send them without even coming yourself, they'll separate themselves from their kids.

COATES: They're in desperation obviously.

HILL: Sometimes they do because the only way they feel that they can get their child to a safe --

WALSH: Usually they pay a lot of money.

There are a number of story, there's a lot going on here. This is far from the last time we will talk about it, however, we're wrapping it up for this afternoon. They are the silent majority on many of your flights, the silent security rather. Could Federal Air Marshals however soon be boarding fewer planes and what did that mean for you the next time you fly? The surprising plan that could save some money, it's a CNN exclusive you'll see first on THE LEAD.

(COMMERCIAL BREAK)

[16:50:00] HILL: Back now with breaking news and a CNN exclusive. The TSA is discussing cuts to save money. Documents reveal one option being explored cutting the number of Federal Air Marshals. It's part of the same story we first reported here on THE LEAD that the TSA is also looking at eliminating security at small airports across the country, an idea widely panned by security experts but again an option being floated to save money. CNN's Rene Marsh joins me now. So, Rene, these cuts could potentially save the agency what, some $300 million in the next couple of years?

RENE MARSH, CNN AVIATION AND GOVERNMENT REGULATION CORRESPONDENT: That's according to the document, that is the goal. But tonight it raises the question has the risk to aviation decreased or is this all indicative of an agency feeling the pressure to cut costs?

(BEGIN VIDEOTAPE)

MARSH: A new internal TSA document CNN exclusively obtained shows the proposal to eliminate screening at more than 150 small to medium size airports is just one of several cost-saving measures the agency is discussing. A senior TSA employee tells CNN the agency is looking at cuts that could save more than $300 million in 2020. One cut reducing the number of Air Marshals, eliminating screaming at small airports, staffing cuts at TSA headquarters and changes to benefits are also being discussed. TSA did not comment. Juliette Kayyem a former official with Department of Homeland Security under Obama is concerned.

JULIETTE KAYYEM, CNN NATIONAL SECURITY ANALYST: Ending security at certain airports and ending or flat lining the Air Marshal Service are actually inconsistent because if you're going to decrease security at certain airports what you would want to do is increase the presence of Air Marshals or other security features just in case.

MARSH: CNN reveals the most controversial cut eliminating screening at small airports like this one in Redding, California where Bryant Garrett is the manager --

BRYANT GARRETT, MANAGER, REDDING MUNICIPAL AIRPORT: Since I as the airport don't want to take on that either the liability nor the cost and I'm quite certain the airlines don't want to take that on. So if TSA backs out, there's a void and I don't know who would fill it.

MARSH: Air Marshals are the last line of defense, armed agents aboard planes to prevent hijackings. Critics have questioned its effectiveness but the TSA has defended the program as a deterrent.

(END VIDEOTAPE)

MARSH: Yes, just as recently as May, the TSA defended the Air Marshals program so it really raises the question about why the agency is discussing cuts, potential cuts to that program now. I will repeat, we reached out to TSA multiple times but they did not respond to a request for comment. Erica?

HILL: It is a lot to take in. Phil Mudd, do any of these scenarios make sense to you?

PHIL MUDD, CNN COUNTERTERRORISM ANALYST: There is one broad scenario that makes sense and adds. Let me break some news for you. This country, that is the United States and I'm a citizen here overspends on security. If you look at our spending on the conventional military and intelligence side we far outstrip people around the world in terms of spending so TSA is doing what other countries routinely have to do around the world, that is risk management. Before I close, one quick comment. I'm not sure this is just about a proposal and I'm not sure that we CNN are really the recipients of this message. I suspect somebody is leaking this as a message of Congress to say if you keep cutting our budget this is the kind of stuff you're going to get so you better get up and give us this money.

HILL: Well, in that vein, Rene, as we look at that these, these are discussions that are being had as you were told. Have you gotten a sense of how serious any of these measures are?

MARSH: You know, no, because we just have not been able to get anything back from TSA despite us reaching out. We do know that I mean, the TSA Administrator was certainly briefed on this according to our source just last month so we know the discussions are happening, what will the end result look like it's really unclear. But the issue is you know, people will say agency tagency there are always having these conversations about how can we be more efficient, where can we trim, where it's possible to be trimmed. The issue that some people have here is that a lot of the tickets you and I buy when we buy an airplane ticket, you will pay a tax and a lot of that money is supposed to go to security that TSA provides. The question that a lot of these small airports have is if I'm spending, I'm paying a tax every time I buy an airplane ticket why is it that I perhaps may see the presence of TSA disappear at my airport?

So these are some of the questions that are being raised. Sure, certainly, cutting and trimming at agencies is it something that is a routine but I think that many people who live in those smaller areas especially with the screening, you know that you buy a ticket you're paying a tax for TSA security and you don't see the TSA security at your Airport, you're kind of scratching your head.

HILL: Well, it also -- and there's the obvious point too of does this make those airports vulnerable targets. So Phil, to your point about some risk assessment needing to be done, some cuts that could potentially be made, if you're looking at the risk assessment, give us the 30,000-foot view. What do you see today that perhaps could be changed so that people don't have to give up security at airports or on board a flight?

MUDD: Let me give you the ten-second answer. Americans have to undergo security that's a little bit more difficult for them, that is bring a purse side -- purse-sized bag on a plane. Everything goes out in the belly, everything else. Americans wouldn't like it, that's an easy solution.

HILL: All right, there's one. You got a second one because you got another 15 seconds.

MUDD: The second one would be looking at I think some of these smaller airports and I would agree looking at tiny airport saying do we need the kind of security we have today. That's the kind of mid- risk measure I would consider. I think that's OK.

HILL: Do you think we don't need that kind of security at smaller airports? I mean I've used a number of those airports. Yes, they're convenient but if other people know there's no security there --

MUDD: Sure, but if you're looking at the kind of simple screen and you can you can get at these airports I don't think we need that much screening.

MARSH: And Erica I think --

HILL: Rene, question -- I got to leave it there, I'm sorry. I appreciate it. Thank you both. Tune in Sunday morning to "STATE OF THE UNION" with Jake Tapper. We're all talking exclusively with Congressman Ed Royce and former Massachusetts Governor Deval Patrick. That's all Sunday morning 9:00 a.m., 12:00 p.m. Eastern.