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The Lead with Jake Tapper

Senate Passes Bill to Avoid Catastrophic Rail Strike; Biden: Would Meet with Putin About "A Way to End the War"; After Conflicting Statements, Police Affirm Attack was "Targeted; Police: Letter Bombs Sent to Six Locations in Spain; Russia Appears to Make Some Gains in East, Suffers Heavy Casualties; Former FTX CEO: "I Got a Little Cocky". Aired 4-5p ET

Aired December 01, 2022 - 16:00   ET

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

[16:00:06]

ALISYN CAMEROTA, CNN HOST: I love that too because Bruno Mars is so charismatic.

VICTOR BLACKWELL, CNN HOST: We had 13 more seconds of that, actually. The show is almost over. But it's just so rich. It is so beautiful.

CAMEROTA: It is beautiful. I'm not going to argue with you.

BLACKWELL: All right. Breaking news, the Senate has just passed legislation to prevent a nationwide rail strike that would cripple the economy if that happened.

THE LEAD now takes it over with Jake Tapper right now.

JAKE TAPPER, CNN HOST: Breaking news, a deal passed to avert what would have been, could have been, a crippling rail strike.

THE LEAD starts right now.

The final vote in the U.S. Senate called just moments ago. I'm going to speak with the Secretary of Transportation Pete Buttigieg fresh off his Hill visit to fast track and preserve today's deal.

And a letter bomb sent to America's ambassador. Security has been stepped up after a series of suspicious deliveries.

Plus, the manipulative man behind the abrupt collapse of the crypto company, FTX.

(BEGIN VIDEO CLIP)

SAM BANKMAN-FRIED, FORMER FTX CEO: I mean, look, I screwed up.

(END VIDEO CLIP)

TAPPER: You think? What else the, quote, monster says about scamming customers and watching their life savings evaporate.

(MUSIC) TAPPER: Welcome to THE LEAD. I'm Jake Tapper. And we start today with breaking news in our politics lead.

Just moments ago, the Senate passed a bill that would help avoid a catastrophic rail strike, one that was expected to start within days.

Now the legislation which had passed the House of Representatives heads to President Biden's Resolute Desk for signing. Just a few hours ago, it looked as though the agreement could be derailed with members of both parties, Democrats and Republicans, demanding paid sick leave for the union rail workers.

CNN's Manu Raju starts off our coverage from Capitol Hill with an inside look at how this deal came together just minutes ago.

(BEGIN VIDEOTAPE)

MANU RAJU, CNN CHIEF CONGRESSIONAL CORRESPONDENT (voice-over): The Senate averting a devastating blow to the U.S. economy, voting to prevent a railway strike after a tense week of negotiations.

SEN. ELIZABETH WARREN (D-MA): On one hand, we don't want to shut down the economy. On the other, we don't want to say to rail workers, if you have a heart attack or you break your leg, you either show up to work or you're going to lose your job.

RAJU: Lawmakers recognizing that a strike could have disrupted food supplies and intensified sky high inflation and send the economy reeling.

Do you have concerns about Congress intervening here?

SEN. BILL CASSIDY (R-LA): Of course. There are also concerns about a rail shutdown. So, that's what I'm considering.

RAJU: The tentative deal, now enforced by Congress, was brokered by the Biden administration. Major railways and eight of 12 labor unions. But that plan lacks paid sick leave for workers. So, progressives on Capitol Hill demanded that the Senate guarantee at least seven days for rail workers.

SEN. BERNIE SANDERS (I-VT): It would be an absolute outrage if these workers were out there at least seven days basic leave.

SEN. SHERROD BROWN (D-OH): So this is a small number of dollars for their bottom line to take care of their workers, the way that they should.

RAJU: President Biden defended the deal with the White House today when questioned on paid sick leave.

JOE BIDEN, PRESIDENT OF THE UNITED STATES: What I made it very clear is, that -- what was negotiated was so much better than anything they ever had.

RAJU: But the amendment to mandate paid sick leave fell eight vote shy of the 60 needed for passage, amid opposition for most Republicans, who say that Congress should not dictate the terms of the negotiations.

Moderate Democrat Joe Manchin agreed.

SEN. JOE MANCHIN (D-WV): There's concern about us jumping into that, when you have eight unions that have agreed to the package that they negotiated with the Department of Labor and with the president. I'm very reluctant on the other for us to jump in and set a precedent.

RAJU: Behind the scenes, the lobbying campaign intensified. Labor Secretary Marty Walsh and Transportation Secretary Pete Buttigieg joining a private lunch of Senate Democrats and demanding action.

SEN. CHUCK SCHUMER (D-NY): The Senate cannot leave until we get the job done.

RAJU: While Republicans have been skeptical, the plan winning the support of Senate GOP leader Mitch McConnell, even as the top House Republican Kevin McCarthy opposed the deal when it passed the House on Wednesday.

SEN. JOSH HAWLEY (R-MO): The whole law interferes with the negotiation.

(END VIDEOTAPE)

RAJU (on camera): So, the vote was a bipartisan one in the Senate. They just closed just moments ago. The vote was 80 to 15, and the 80 voting yes, 15 voting against it. Five of those, no votes for Democrats. Ten of those appear to be Republicans. There was one Republican voted present, that's Senator Rand Paul.

So, after a week of back-and-forths, Jake, a bipartisan vote in the Senate gets -- essentially moves forward on this tentative agreement without the paid sick leave that many progressives demanded.

TAPPER: And conservatives, as well. Manu Raju, thanks so much.

Joining us now to discuss, Transportation Secretary Pete Buttigieg.

Mr. Secretary, the bill just passed the Senate despite objections from members of both parties who wanted paid sick leave to be included.

Why are you okay passing a deal that does not guarantee paid sick leave for these union workers?

[16:05:02]

PETE BUTTIGIEG, TRANSPORTATION SECRETARY: Well, first of all, the importance of this deal is that the rail shutdown is being avoided. If that were to happen, we would have seen hundreds of thousands of American workers laid off, energy prices shooting up once refineries were unable to continue operating, issues getting chlorine to water treatment plants, auto industry factories shutting down within hours if not days of that happening. So what we've been able to avoid is a major blow to workers, farms, families across the country. Not everybody got what they wanted in this deal, but what was enacted is something that mirrors what was reached in the tentative agreement at the negotiating table between union leaders and railroad companies.

What that includes is a 24 percent pay increase for railroad workers. They are essential workers, who deserve to be paid well on average, $100,000 or so in pay. It includes adjustments to their health care, and an additional day of paid personal leave.

But again, not a perfect deal. And every side had to give in something in those negotiations to reach that deal. I think there is an ongoing conversation in this country about how to make sure that workers in this sector and in every sector get the support that they need.

But right now, what you have is a deal that is improving pay and work conditions for American railroad workers and crucially avoiding a shutdown that would have been devastating to the American economy.

TAPPER: Without question, the shutdown would've been devastating to the American economy. I think everybody out there is glad that it's been avoided. But the question is, these rail lines are making billions of dollars, profits are up for all of them, quite a lot, in some cases. You and I have paid sick leave. My crew has paid sick leave. Why don't these railway workers deserve paid sick leave?

BUTTIGIEG: Let me remind you, the position of our administration is that every American worker ought to have paid leave, whether you're a railroad worker, a journalist, a federal government employee, or whether you work at Burger King. We believe that every American worker, certainly every full-time American worker ought to have paid leave. The president has proposed that. The president has advanced that in proposed legislation. And so far, it has been unable to get past what has been the Senate opposition.

We are going to continue to press for that. Again, not just picking and choosing one sector over another, but based on the basic idea that every single American worker ought to have paid leave, just like you haven't pretty much every country in the world. But for now, right now, the tentative agreement that was reached at the bargaining table between union leaders and companies contains provisions like this pay raise and another improvements.

TAPPER: Right. I get it, but saying that they ought to have paid sick leave, and then getting in there and saying to the Warren Buffett's of the world, give these guys paid sick leave or the White House is going to make you guys out to be bad guys, and you're going to be the ones that are going to force to blink after your reputations take a number of hits, that's a different matter.

We've heard from multiple union workers who feel like Biden administration has let them down. Gabe Christenson, a freight railroad brakeman, who lives in Nevada, he told CNN, quote, here we have someone, meaning Biden, who touted themselves as the most labor- friendly president for many decades and he basically just betrayed us. There really is no difference between Democrats and Republicans anymore. They are just feeding corporate greed, unquote.

What do you say to Gabe Christenson?

BUTTIGIEG: Well, if you don't think there's any difference, you should look at the difference between this president, who has advanced good paying jobs, who has made sure the National Labor Relations Board is able to do its job, who has put in the first card carrying union member to be labor secretary in a generation, who has upheld everything from Davis-Bacon wages to the kind of working conditions, to make sure that unions can thrive, because he believes strongly in American unions and organized labor. And he is proud to be the most actively pro-union president in a generation.

Again, that does not mean everybody got everything that they wanted. We need to have a broader conversation about these labor models and the business practices of transportation companies in this country. I think that conversations going to continue and will reach a new phase as soon as the ink is dry on this bill.

But in the meantime, what you have a tentative agreement that was reached by union leaders and company leaders at the bargaining table, and they're simply were not votes, as we saw. Not the votes in the Senate, for sure, to go in and change the terms of what was reached at that table. And this is not a situation where you can play around, where you can allow things to come to the brink.

Even before the date of a potential shutdown, several days before that, you would have seen shipments begin to wind down, hazardous materials, financially including chlorine for water treatment in this country --

[16:10:01]

TAPPER: Yeah.

BUTTIGIEG: -- not able to get to where it needed to go.

So this is a situation where we couldn't allow brinkmanship to override the economic and national security of this country. But we are far from done, as an administration, doing our continued work to create good paying jobs, to support union jobs, and again, continuing to press the case for paid leave for every single American in every single drop in this country.

TAPPER: What does it mean to press the case if you're not willing to like actually go to these billionaires and say, how on earth can you sleep at night? Not letting railway workers have paid sick leave? Which is just like that.

I mean, that's not an extravagant benefit, paid sick leave. You get sick, you could take a few days off. They don't have that.

So, I guess these lofty aspirations are one thing, but I didn't hear any language coming from the administration saying, these rail companies need to get serious about offering basic -- basic benefits like paid sick leave. I didn't hear that. So I understand what Gabe Christenson is coming from.

BUTTIGIEG: Well, again, what this administration supported was what the union leaders and the company leaders agreed to. And they did not insert changes into the agreement, because that would have likely added time and complication to a process that would have taken us off the cliff economically.

Let me be clear: very specific legislative proposals have come from this administration advancing paid leave. And if our friends on the other side of the aisle would work with us we could've had that. We could've had it in the future, and that's going to continue to be something we work on.

In the meantime, what we have now is millions of Americans who can breathe a sigh of relief, knowing that everything from baby formula to milk to petroleum products that affect the price of gasoline, to treatment and materials for water. All of that will continue moving, and the essential workers will get them where they need to go. And not only have an additional they have paid personal leave, per the agreement that was reached, but also a 24 percent pay increase.

TAPPER: Yeah, obviously, not every labor leader was on board with that plan. But there were some that were.

Transportation Secretary Pete Buttigieg, thanks and congratulations on averting the major crisis. But I think there's still some work to be done on the paid leave -- paid sick leave that we talked about.

BUTTIGIEG: Agreed.

TAPPER: Thank you so much for being with us. I appreciate it.

BUTTIGIEG: Thank you.

TAPPER: The red carpet laid out for French President Emmanuel Macron today. What he and President Biden discussed at length in the three- hour meeting.

And the controversial item on the menu for tonight's state dinner.

Plus, the message from police in Idaho that is creating more confusion in the community after the killings of for college students.

And, just, in a Supreme Court decision impacting President Biden's plan to cancel student loans.

Stay with us.

(COMMERCIAL BREAK)

[16:16:48]

TAPPER: We're back with our world lead.

President Biden hosting French President Emmanuel Macron, today, for his first state visit since moving into the West Wing. The two say they discuss the Russian invasion of Ukraine at length and Monsieur Putin, and how to further support the Ukrainians fighting back against Putin.

As CNN's Phil Mattingly reports for us now, President Biden says he's willing to meet with Putin, but only under certain circumstances.

(BEGIN VIDEOTAPE)

PHIL MATTINGLY, CNN CHIEF WHITE HOUSE CORRESPONDENT (voice-over): On a day carefully calibrated to elevate a critical alliance.

JOE BIDEN, PRESIDENT OF THE UNITED STATES: Mr. Putin is -- let me choose my words very carefully.

MATTINGLY: President Biden, signaling a willingness to open a line of communication with Russian President Vladimir Putin.

BIDEN: I'm prepared to speak with Mr. Putin if, in fact, there is an interest in him to decide that that he's looking for a way to end the war.

MATTINGLY: With clear preconditions.

BIDEN: He has not done that yet. If that's the case, in consultation with my friends and my NATO friends, I'll be happy to sit down with Putin to see what he wants and has in mind. He hasn't done that yet.

MATTINGLY: The brutal war in Ukraine, now in its ninth month at the center of a three hour sit down with French President, Emmanuel Macron.

BIDEN: It's great to have my good friend back here.

MATTINGLY: After which, Macron was explicit in his commitment not to circumvent Ukraine in any peace talks.

PRESIDENT EMMANUEL MACRON, FRANCE: We will never urge the Ukrainians to make a compromise, which would not be acceptable for them.

MATTINGLY: Biden's first state visit underscored the value and durability White House officials see in the relationship with America's longest running ally, with two leaders going to great lengths to demonstrate their unity and ironed out clear-cut differences.

BIDEN: I make no apologies.

MATTINGLY: Biden clearly addressed French concerns with sweeping subsidies included in his cornerstone economic and climate legislation.

BIDEN: But there are occasions when you write a massive piece of legislation and that has almost $368 billion for the largest investment in climate change on all of history. And so, there is obviously going to be glitches in it.

MATTINGLY: And providing assurances that issue would be addressed.

BIDEN: I'm confident. That's my answer.

MATTINGLY: For Macron, a day and a dinner underscoring a White House view of the relationship that has only grown in its importance in Biden's first two years. One driven, officials say, by a genuine personal connection.

BIDEN: I began to refer to him privately as my closer.

MATTINGLY: The connection that has become critical in a moment when geopolitical threats have rattled alliances worldwide.

BIDEN: France is one of our strongest partners and historically, but one of our strongest partners and the most capable allies. And Emmanuel has also become a friend, in addition to being president of that great country.

(END VIDEOTAPE)

MATTINGLY: And, Jake, that three-hour meeting behind closed doors certainly at the center of the visit. But, obviously, the main event is the dinner. In just a couple of hours, several hundred guests are expected to arrive for the first state dinner for President Biden. There will be dancing. There will be dinner, a real comingling of French and American traditions and colors.

[16:20:03]

John Baptiste, the Grammy-winning artist, is scheduled to perform, Jake.

TAPPER: And, Phil, there is a controversy about one of the main dishes being served at the state dinner. Tell us about that.

MATTINGLY: Yeah, main dish, that's actually a good way to frame it. It's lobsters. Two hundred live lobsters sent down from the state of Maine. You think it would thrill Maine politicians, Maine fisheries and lobstermen. However, it's at the center of a regulatory and legislative battle that's been ongoing for a long time from the conservationists that would like the lobstermen basically to stop getting the lobsters that they do.

This is such a central component of Maine's economy right now. There is some frustration that regulatory actions by the administration's run counter to the idea of wanting to support or bring down those lobsters.

As for the moment, White House officials not really weighing in on the matter. But Maine politicians, making very clear, if it's good enough for the White House, it should be good enough for any grocery store or certainly regulators, Jake.

TAPPER: Yeah. So, Congressman Jared Golden, the Democrat from Maine's very competitive second district weighing in against his fellow Democrat, Joe Biden. Phil Mattingly, thanks so much. Appreciate it.

Coming up next, the new message from police in Idaho creating confusion three weeks now after four college students were tragically stabbed to death there.

Stay with us.

(COMMERCIAL BREAK)

[16:25:42]

TAPPER: Topping our (AUDIO GAP) statements from Idaho police are creating confusion 18 days after four University of Idaho students were found dead in their apartment. Hundreds came together in a moving vigil last night, where families of the slain students shared memories and moments of silence.

CNN's Veronica Miracle is in Moscow, Idaho, where police are facing scrutiny not only for an apparent lack of progress in solving the case, but for confusing a grieving public.

(BEGIN VIDEOTAPE)

CHIEF JAMES FRY, MOSCOW POLICE: We still believe it's a targeted attack.

VERONICA MIRACLE, CNN CORRESPONDENT (voice-over): From the beginning, police repeatedly calling the stabbing deaths of four University of Idaho students, a targeted attack, even issuing a statement saying, evidence indicates that this was a targeted attack.

UNIDENTIFIED MALE: Somebody targeted these individuals for some reason.

MIRACLE: But last night, a new statement led to confusion about whether the police stood by that theory.

The department posting: Detectives do not currently know if the residents or any occupants were specifically targeted, but continue to investigate.

That statement brought a flurry of headlines suggesting police were doing an about-face. But they now tell CNN, their post was in response to comments made by Latah County prosecutor Bill Thompson, who said in an interview that the home of the victims and specifically one or two of the roommates may have been targeted.

That, alone, is what police say they are clarifying, telling CNN: We remain consistent in our belief that this was, indeed, a targeted attack. But have not concluded if the target was the residents or its occupants.

The police chief reaffirming that this morning.

INTERVIEWER: Why do you believe it was targeted? Or the reasons are so crucial o the investigation that they cannot be revealed?

FRY: We are not going to reveal that. That's part of that investigation, trying to pull the pieces in that will help give us the before, the during, and the after.

MIRACLE: Police have told all of the cars from in front of the home and confirmed they've received some lab tests back from the crime scene, though they won't see say what they are.

Meanwhile, the Moscow community is in mourning as they gathered at a candlelight vigil Wednesday night. Several of the victims' families spoke about their tremendous loss.

STACY CHAPIN, MOTHER OF VICTIM ETHAN CHAPIN: The circumstances that bring us here tonight, they are terrible. The hardest part, we cannot change the outcome.

MIRACLE: And they also spoke about what comforts them during this difficult time.

STEVE GONCALVES, FATHER OF VICTIM KAYLEE GONCALVES: They shared everything. They've -- into the same apartment together. And in the end, they died together, in the same room and same bed.

(END VIDEOTAPE)

MIRACLE: And, Jake, we have a police presence continues here in the community of Moscow and on campus. But for how much longer at the University of Idaho? That is unclear. Students get out next week for the rest of the semester and they don't come back until mid January. The University of Idaho tells me they're going to be revisiting their security plans as this investigation continues to unfold -- Jake.

TAPPER: All right. Veronica Miracle in Moscow, Idaho, thank you so much.

Let's bring in CNN counterterrorism analyst and former FBI senior intelligence officer, Phil Mudd.

Phil, we know that DNA test results are starting to come in. Do you have any confidence that a suspect could be identified within the next few days as a result of that?

PHIL MUDD, CNN COUNTERTERRORISM ANALYST: I would not say confidence. Hope might be a bit of turn.

Look, there's going to be a lot of data you have to look through. We know there six residents there, there's also reports that there was a lot of social activity at the house.

So, how much the any, for example, hairs from other people was picked up? Can you determine whether those hairs were from visitors out of party two weeks ago? Or whether those hairs were not from the people in the house, might be related to the killer. I think that's going to take some time. On the reverse, Jake, I'd say if you have more physical attacks with

interaction, including defensive wounds on the murder victims, the chance that the killer thought enough ahead to leave no evidence that police could find, I'm hoping they find some, because that's a lot of physical interaction to leave nothing behind, Jake.

TAPPER: Well, that's what I'm wondering. Are you surprised that 18 days later, there's been as far as we can tell, no suspect named, no weapon found? I mean, it's almost three weeks. Maybe the public has been spoiled from entertainment versions of investigations and maybe 18 days is actually not that long. But give us your take.

MUDD: I would say beyond surprise. Very surprised because you're not just talking about the many interviews with friends and family, you're talking about a relatively small community. But in the digital age, you can track everything or a lot of what these young people were doing in the previous weeks through things like text messages.

We've seen a lot of video from the locations they were at before, which not only allows us to look at the time line of where they were, but who they talked to. You know every person they took a class with in the last year, two years. You know every neighbor they have had for years, so in the digital age, you can get a trail. You can get a pattern of life far different than you could have 20 years ago.

And with the amount of investigation on this, to not have a significant advance -- I'm not criticizing the police. I am saying that's pretty surprising.

TAPPER: The FBI has been investigating alongside the local Idaho police mostly helping gathering tips, we're told. Do you think the FBI should have a bigger role in this case, perhaps a more public role, perhaps even the primary role, considering, A, how little apparent progress there has been made almost three weeks into this, and B, the fact that the police have been making some inconsistent statements?

MUDD: I don't think the FBI should have a more significant role unless the state and locals ask for a more significant role. The FBI has relationships with 10,000 police departments across the country. That has everything to do with things like abductions to bank robberies to support in this case, for murders.

The typically role for the FBI, if there's a local case and you want assistance, there's not federal violation, we provide assistance. If the FBI got in position of telling police departments we're taking over because we think you're incompetent, Jake, I don't want to see that world because the cooperation with local police departments I think would decline dramatically. We don't want that.

TAPPER: Is it true that the longer this goes on, the tougher it will be to find the killer?

MUDD: Yeah, that's going to be true. I mean, you look at the case resolution rates and everything in the data will show you that. There's a flip side of this, though, and if -- and that is if you look at things like the FBI's most wanted category of people, anybody who did this who thinks they can cover their tracks for a year or five years or ten years, the data don't bare that out.

If there's a high end investigation where investigators hunt for years, the chance, even if we have the tragedy of someone escaping for a month or three months or six months, the chance they escape forever, not that high, I think.

TAPPER: All right. Phil Mudd, thanks so much. Appreciate it.

Coming up next, a series of letter bombs sent in Spain. What happened when one was delivered to the U.S. embassy? We'll tell you next.

(COMMERCIAL BREAK)

[16:31:46]

TAPPER: We start this world lead in Spain which is on high alert after the discovery of six letter bombs. Police in Spain say the targets included the United States and the Ukrainian embassies in Madrid, as well as Spain's prime minister, Spain's defense minister, and arms manufacturer and a Spanish air force base.

A staffer at the Ukrainian embassy in Spain was hurt when an envelope exploded. The rest of the bombs were intercepted or deactivated before they reached their intended targets.

Let's bring in CNN's Kylie Atwood at the State Department.

Kylie, investigators believe that some of these letters may have originated in Ukraine?

KYLIE ATWOOD, CNN NATIONAL SECURITY CORRESPONDENT: Well, yeah, a senior Spanish official said that they believed that this letter bomb that arrived at the weapons manufacturer in northern Spain apparently originated in Ukraine. But that's not definitive, and we've also heard from other Spanish officials that some of these mysterious packages were likely to have originated in Spain.

So the question as to where they originated, what the actual motivation of these mail bombs actually is, is still an open question, Jake. And, of course, we should note that the mysterious package that was sent to the U.S. embassy in Spain just today was intercepted and it was detonated in a controlled environment. No one in that situation was hurt.

TAPPER: Kylie, let's turn to another story that we've been following. Today, the spokesman for the Kremlin, Dmitry Peskov, said that Russia is not going to engage with the United States on a proposed prisoner swap before the end of 2022. That sounds like unwelcome news for the families and -- of and detained Americans, Brittney Griner and Paul Whelan.

ATWOOD: Definitely unwelcome news, but it is challenging, as you well know, to parse through the statements of Russian officials particularly when they are at times, at odds with one another because just a few days ago, we heard from the deputy Russian foreign minister saying that it wasn't all together off the table, that there could be a prisoner swap before the end of the year.

Of course, the thing that is of the front and foremost concern to U.S. officials right now is Paul Whelan because his whereabouts in Russia right now is unclear. His family has been told that he has been moved to a hospital at the prison. But Russian authorities have not definitively told the U.S. embassy that as far as we know, and he has not called his home. He usually talks to his family just about every single day. They haven't heard from him in a week, and that includes not calling home on Thanksgiving and not on his father's own birthday, so raising some concerns there -- Jake.

TAPPER: All right. Kylie Atwood at the State Department for us, thank you so much.

Now to Ukraine, U.S. officials tell CNN that the United States is considering a dramatic expansion in the training that U.S. provides to Ukrainian forces. That deal would include training 2,500 Ukrainian soldiers every month at a U.S. base in Germany.

While Ukraine's army has made some remarkable recent gains, Russia is clawing back some ground on the eastern front of Donetsk.

CNN's Sam Kiley is in Eastern Ukrainian city of Kramatorsk.

And, Sam, your team heard heavy artillery fire throughout the day. What is going on there? How are Russian forces faring?

[16:40:03]

SAM KILEY, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, Jake, we can still hear it going on in the distance, the distant rumble of detonations, outgoing and incoming, I would imagine. Possibly, air strikes, too.

It has been by any standards, and we have only got the verbal communications from Ukrainian troops, but we've seen the postings made by Russian troops that this is a very, very bitter battle, indeed.

I spoke to a foreign fighter, foreign volunteer today. He lost a friend. He said he had a friend die on him today, and that is the pattern I'm afraid from the Ukrainian perspective. They are losing troops there. They're saying that they're killing more than they are losing.

And they also can't quite understand why exactly Bakhmut represents such a prize, that they why would invest it, this is the Russians, why they would invest it with so much blood, so much energy and so much violence when it doesn't really from a Ukrainian perspective represent a particularly important strategic site.

The only explanation from the Ukrainians is the Russians need a victory after their losses in the northeast around Kharkiv in particular, but also more recently in Kherson.

There's also suggestions coming from Ukrainian commanders here that possibly the Wagner Group which is known to be fighting there, those are the mercenaries, the Russian mercenaries, they are able to buy more sophisticated equipment, which might give them an edge particularly at night, they are seeing slight changes in Russian tactics, and there have been small gains by the Russians as they seek to encircle that city.

But it's about 25, 30 kilometers from where I'm standing right now and there have been an awfully lot, a terrific amount of fighting ahead of the Russians even if they were to capture that town because where I'm standing here is the ultimate prize, and they're a very long way from that, Jake.

TAPPER: All right. Sam Kiley in Ukraine, thank you so much.

Coming up, the man who created a crypto nightmare. He's been called a monster, a manipulator. How he is kind of trying to possibly fess up to the mess he made. That's next.

(COMMERCIAL BREAK)

[16:46:33]

TAPPER: We're back now with our money lead and this admission, quote, a lot of people got hurt and that's on me. Those comments from Sam Bankman-Fried, the disgraced ex-CEO of the now collapsed cryptocurrency exchange FTX.

Much to his lawyers' likely dismay, Bankman-Fried will not stop talking. In two new interviews, he was pressed on what he knew about transfers of customers' money from FTX to a separate hedge fund that he owned.

Here's more now from CNN's Marc Stewart.

(BEGIN VIDEOTAPE)

SAM BANKMAN-FRIED, FORMER FTX CEO: Look, I screwed up.

MARC STEWART, CNN CORRESPONDENT (voice-over): Sam Bankman-Fried was once seen as the wonderkid on the crypto scene. Now he's the face of a massive failure. He claims his billion dollar empire has now been whittled down to about 100K in a bank account.

BANKMAN-FRIED: I'm a CEO. I was a CEO of FTX, and, I mean, I say this again and again that that means I had a responsibility.

STEWART: Customers around the world are scrambling to recover funds following the collapse of the one-time multibillion dollar business. Bankman-Fried shrugged off the comparison to Bernie Madoff, the man behind one of the biggest financial fraud schemes.

INTERVIEWER: A lot of people look at you and see Bernie Madoff.

BANKMAN-FRIED: Yeah, I mean, I don't think that's who I am at all. But I understand why they're saying that. People lost money. And people lost a lot of money, and, I mean, at the end of the day, look, there's a question of what happened and why and who did what. What caused the melt down, and I think that is -- reads very differently, right, when you look at the classic Bernie Madoff story, there was no real business. FTX, that was a real business.

STEWART: FTX used celebrity endorsements from super stars like Tom Brady, Naomi Osaka, Steph Curry, even a Super Bowl ad featuring Larry David, but the big names can't cloud questions as to whether FTX improperly used investors' money to make loans to his hedge fund.

BANKMAN-FRIED: I do not know there was improper use of customer funds.

INTERVIEWER: You also took out a $1 billion loan. What was that for?

BANKMAN-FRIED: That was generally for reinvesting in the company.

STEWART: As investors ponder what's next, Bankman-Fried admits he didn't pay attention in a business that's based on trust.

BANKMAN-FRIED: I wasn't spending any time or effort trying to manage risks on FTX, trying -- like, and that obviously --

INTERVIEWER: That's a stunning admission.

BANKMAN-FRIED: What?

INTERVIEWER: That's a pretty stunning admission.

BANKMAN-FRIED: Yeah, I mean, I don't know what to say. Like, what happened happened. I think I stopped working as hard for a bit. You know, honestly, if I look back on myself, I think I got a little cocky, maybe more than a little bit, and I think part of me, like, felt like we'd made it.

(END VIDEOTAPE)

TAPPER: Marc Stewart joins us now.

And, Marc, the collapse of FTX is capturing the attention of some lawmakers including Democratic Senators Jon Tester of Montana, and Elizabeth Warren of Massachusetts who in interviews with "Semafor's" Joseph Zeballos-Roig are calling out crypto, saying it's, quote, all bullshit, unquote. This is still a very unregulated industry.

STEWART: I think it remains to be seen, Jake, if there's going to be more regulation, if this is going to serve as a watershed moment.

[16:50:06]

If we look back at history, 2007, 2008 financial crisis, the Bernie Madoff scandal, all of those events did lead to reform on Wall Street.

Take a listen now to Michigan Senator Debbie Stabenow.

(BEGIN VIDEO CLIP)

SEN. DEBBIE STABENOW (D-MI): Congress must act to pass legislation that will hold this industry to the same rules as traditional financial institutions and close gaps, gaping holes in our regulations. If we failed to meet this responsibility, consumers will continue to be harmed and hard-working Americans will continue to lose billions of dollars at the hands of bad actors like FTX.

(END VIDEO CLIP)

STEWART: And, Jake, these concerns are far from novel. This is something that the head of the Securities and Exchange Commission has been talking about now for months.

TAPPER: All right. Marc Stewart, thanks so much. Really appreciate it.

Coming up, controversy over the treatment of a Black woman, a British citizen, inside Buckingham palace, threatening to overshadow the royal visit to Boston by the prince and princess of Wales, William and Kate.

Our royal correspondent Max Foster is live for us in Boston right now.

Max, CNN is now hearing from that woman about her experience.

MAX FOSTER, CNN ROYAL CORRESPONDENT: Yeah. And she's basically continuing to talk about it because she said this is an issue that needs to be talked about. She was at an engagement at Buckingham Palace. She was there in her -- she founded a domestic violence charity. It was a reception recognizing the blight of domestic violence. She was there in that capacity.

But she got approached by a senior palace aide and she was repeatedly asked where she was from, where in Africa she was from, where her people were from, and she felt very uncomfortable. She wanted to leave. But she said she wanted to stay in the end because she realized she shouldn't have to feel uncomfortable in that situation.

The aide has resigned, and investigation is under way. And today, Ngozi Fulani went on CNN to try to educate people effectively about her experience so others could learn from it.

(BEGIN VIDEO CLIP)

NGOZI FULANI, CEO, SISTAH SPACE: I'm standing next to two other Black women, and the look on their faces shows me that this is not my imagination. I'm not being -- she's really going at it hard here. Then she said, I can see I'm going to have a challenge to get where you come from at. So then she says, "What's your nationality?"

(END VIDEO CLIP)

FOSTER: Buckingham Palace saying to remind themselves of their diversity policy. This was a policy that was updated, Jake, after the duchess of Sussex, Meghan, complained about racism within the royal establishment as well.

So there's certainly, you know, a huge amount of upset within the palace about this incident. And they acted very quickly. But at the same time a lot of people outside the palace are saying, well, you're not doing enough, you're not making enough progress and there needs to be more diversity in the palace.

Even Prince William saying this is -- racism shouldn't be tolerated in any situation and it's good that this aide stepped down immediately.

As we understand it, according to UK media, this aide was in fact his godmother. So that shows how strongly he feels about it.

TAPPER: And what's next for Prince William and Princess Kate as they continue their visit to Boston?

FOSTER: Well, the palace has made a statement about this incident, but they are doing as royals do and they're keeping calm and carrying on, as I understand it. They don't want to be distracted from their core mission here, which is promoting solutions to the climate crisis. So, they're here on the coast of Boston looking at coastal erosion, seeing what's being done to prevent that. They just left.

Tomorrow's their big night really. It's the Earthshot Prize. It's where -- it's something that he's worked towards for months. He says it is his Super Bowl. It's about finding solutions to the climate crisis and trying to help them become a reality. The big prize winners get a million dollars each. He's utterly focused on that. Hoping that these other stories won't necessarily go away but they can do enough to resolve them long term, frankly.

TAPPER: All right. Max Foster in Boston, traveling with the prince and princess, thank you so much.

Coming up, the Supreme Court decision this afternoon having a direct impact on President Biden's plans to cancel millions of dollars in student loan debt. How might this affect you?

Stay with us.

(COMMERCIAL BREAK)

[16:59:03]

TAPPER: Welcome to THE LEAD. I'm Jake Tapper.

In this hour, former President Obama headed to Georgia to help Democratic Senator Raphael Warnock.

Can Obama's closing message make a difference? Only five days out from this competitive Senate runoff election. This as an ex-girlfriend of Herschel Walker comes forward with new claims against him.

Plus, an anonymous protester in China putting his or her life on the line to try to explain why the demonstrations across the country had to happen. How far they had to go to keep their identity protected, and signs that the communist nation may be getting the message.

But we start with news just in to CNN. The top two lawyers from the Trump White House have been ordered to testify again as part of the Justice Department's investigation into Trump's efforts to overturn the 2020 election. A federal judge just handing down the order for former White House counsel Pat Cipollone and Patrick Philbin.

We're going to start our coverage with CNN's Evan Perez.

Evan, these two men have already testified. So why do they have to do it again?

EVAN PEREZ, CNN SENIOR JUSTICE CORRESPONDENT: That's right, Jake. They have testified.