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Charged in Financial Crisis; Eruption Disruption; Human Smuggling Bust

Aired April 16, 2010 - 11:00   ET

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

TONY HARRIS, CNN ANCHOR: The big stories in the CNN NEWSROOM for Friday morning, April 16th. Federal agents put the brakes on a shuttle bus operation they say was smuggling illegal immigrants into the United States was the real business plan. Also this --

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: I hope that there's no cheating -- and if it is cheating, there needs to be a punishment for it.

(END VIDEO CLIP)

HARRIS: Standardized tests. Teachers and school administrators accused of cheating to make sure no child is left behind. And this story.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Ten people once lived here, six died including the parents of these small children, cared for now by their aunt and uncle.

(END VIDEO CLIP)

HARRIS: Boy, the desperate survivors of this week's earthquake in China, hungry, cold and waiting. Our CNN correspondent in the disaster zone.

Good morning, everyone. I'm Tony Harris. Those stories and your comments right here, right now in the CNN NEWSROOM.

First, we want to start with some breaking news from Wall Street. The government accusing powerhouse Goldman Sachs of defrauding investors. It is all tied to those subprime mortgagees that led the country into a financial downturn. We will have much more on this story later this hour.

And now, the worldwide travel impacted for a second day. Yes, much of Europe, a no-fly zone for a second day. Some 17,000 flights canceled due to drifting ash from a volcano in Iceland. Hundreds of thousands of passengers stranded. We are getting reaction from some of them.

(BEGIN VIDEO CLIP) UNIDENTIFIED MALE: It's a danger because, you know, I don't want the plane going down, you know, this is really dangerous, but I've been in some different situations over the years, and this is a new one.

UNIDENTIFIED FEMALE: So, we've basically missed a wedding. Not sure if we're still going to go or not. I don't know that there's any point anymore because we've missed everything what the trip was ultimately for.

(END VIDEO CLIP)

HARRIS: So, this travel chaos is expected to last another 24 hours according to European aviation authorities.

Let's get to our Gary Tuchman. He is in Iceland, and Gary, where exactly are you? Are you actually on the western slope of the volcano?

GARY TUCHMAN, CNN NATIONAL CORRESPONDENT: That's right, Tony. This is Iceland on the southern coast of Iceland, and this mountain is what's causing all the worldwide travel chaos. This is the volcano. You may be wondering how am I standing next to a volcano, and I have no ash or there are no problems whatsoever.

That's because we are on the west side of the volcano, and the winds are 40 miles per hour to the east, mainly in Europe it's on the other side of the volcano and that's where the plume of ash is. It's hard to see from here. It's looks relatively clear ash and you don't see much of the ashes and on the other side, there's plenty of it and that's the direction it's going. So, that's the irony.

Here in Iceland, there are very few problems. This water here flooded far and that's because when the volcano erupted, it was under a glacier. We don't see any magma. We don't see any lava. We see floodwaters. We see rocks, we see refuse, and that is from the volcano, but there's been no one killed here.

There's been nobody hurt. There's been floodwater about (ph) the roads, but the travel here is relatively easy. We were able to fly to Reykjavik this morning because it's west of this volcano. Everything is OK at Reykjavik, Iceland. That's the irony because what's happening here. You're having these immense, chaotic problems throughout much of the world and people trying to connect and get to Europe.

But so far here in Iceland, everything is going well. The only problem is the winds can shift. If the wind shifts in this direction to the west, then they might have to close the airport here in Reykjavik, but the idea right now according to the meteorologist that they expect tomorrow, the winds could come from the north and in this direction and in this direction is the North Atlantic Ocean. That's the best direction for the winds to be going because there's no land there.

The problem, Tony, is the last time this volcano erupted in 1821 which was two centuries ago, the eruptions lasted for two years and that was before the dawn of air travel, so they didn't have to worry about that, so that's a great concern if these eruptions continue for a long time.

HARRIS: Hey, Gary, very quickly here because I know you can do it, and there's no way I could, what is the name of that volcano?

TUCHMAN: You're giving me a great challenge here. I've been practicing this all day.

HARRIS: There you at.

TUCHMAN: I have to read it because it's 16 letters, but here is my finest Icelandic pronunciation of naming this volcano, Eyjafjallajokull, that's the name of volcano, Tony. Sixteen letters. It's a very hard language. A 350,000 people who live in the nation of Iceland. There are the only people in the world who speak Icelandic. It's a beautiful language, but is not spoken by many people. So, I have to admit that I haven't practiced it that much over the years.

HARRIS: And the translation?

TUCHMAN: The translation is icy glacier, basically. That's what it means. It's actually three words put together in Icelandic, but it means icy glacier and that's indeed what it is. And you know, it's erupted throughout the ages, and they call Iceland, Tony, the land of fire and ice because it's very icy. Although it's not as icy as Greenland, that's the irony. Greenland is the icier land. Iceland is the greener land.

Nevertheless, it is still kind of icy; however, they've had many, many volcanoes throughout the year. So, that's why Iceland is here because of volcanoes that are formed throughout eons. That's what this land is here (ph). The people are used to the volcanoes. They're used to dealing with it, and I must tell you, lots of tourists are coming here taking pictures. They don't seem to be excessively worried. They do know it's causing lots of commotion throughout other parts of the world.

HARRIS: Yes.

TUCHMAN: But here, things, so far, are relatively calm.

HARRIS: Well, Gary, we've got our fingers crossed that the wind direction stays as it is and doesn't shift into your direction. Gary Tuchman for us in Iceland. Gary, good to see you. Appreciate it. Thank you.

I've got to tell you, some of the busiest airports on the east coast. We're talking about Atlanta's Hartsfield-Jackson International, Washington's Dulles International, and New York's JFK, all posting flight cancellations right now. Our Richard Roth is at JFK International Airport in New York. And Richard, isn't the simple truth here that you're not likely to get out today if you were flying out of the United States on say, a British airways flight? RICHARD ROTH, CNN SENIOR U.N. CORRESPONDENT: Right. There's no flight flying for British Air to many parts of Europe, especially northern Europe. The board reads cancellation, cancellation, cancellation. There was a flight at 8:40 eastern time, a regular flight to London and that, of course, was canceled. There are two flights later in the evening that they're hoping to get to Glasgow, Scotland, and maybe bus passengers to other parts of the United Kingdom.

With me is Wendy Santer of Brighton, England. She was scheduled to be on that 8:40 in the morning non-stop to London. Well, you haven't flown at all. Tell me what's going on? What are you doing now?

WENDY SANTER, STRANDED PASSENGER: We're just sitting and waiting. We've not been given any information at all apart from we're on standby to go to Glasgow tonight, and then we will be coached down to Heathrow.

ROTH: Now, how did you end up coming to the airport with all the volcano news? You're on vacation, had you heard about it? Did you think that you could fly today?

SANTER: We heard the news on the television, but we were advised to go to JFK because we were told that the flights were canceled. So, we thought we better just come, anyway, because if we didn't come and the flight hadn't been cancelled, then we would miss our flight.

ROTH: So, what is your mood? Are you upset at anyone, a volcano, a British airways attendant? What's your sense of things?

SANTER: I think, no. I mean, it's a natural disaster. It can't be help, but it's the lack of information from BA (ph). There's no information at all coming from them and not even to come out and say we have no information.

ROTH: But do you think they think listen, this is an atmospheric rarity, you should know what's going on?

SANTER: Maybe, but then, when you're on holiday, you don't always have access to information on what's going on back home, back in England. So who knows? Don't know.

ROTH: Did you have a good time in New York?

SANTER: Absolutely fantastic.

ROTH: All right. Wendy, thank you very much. Good luck.

SANTER: Thank you.

ROTH: We'll see if you get out to Scotland later tonight. Very chilly winds out here. Wendy says she had good weather here in New York for the week. Tony, back to you.

HARRIS: All right. Richard, appreciate it. Thank you. And you know, the question many of you are asking is this, why can't jets just fly through this ash? Oh, let's cue Chad Myers.

(BEGIN VIDEO CLIP)

CHAD MYERS, AMS METEOROLOGIST: Why can't planes fly through volcanic ash? Because that's what a volcanic ash particle looks like.

HARRIS: Oh, boy.

MYERS: What do you think that would even do to your car at home?

HARRIS: Just thinking about my lungs.

MYERS: Right. These particles are literally, they could be lava, and what happens if planes fly especially jets, fly through that type of thing, it can re-melt this ash back into lava and it will literally freeze the engine solid. So, you're going to lose all four engines all at the same time and that's not a good thing.

(END VIDEO CLIP)

HARRIS: Boy, Chad Myers will be back with us in just a couple of minutes, and he will have more details for you on the dangers of volcanic ash. He is live from the Weather Center at the bottom of the hour.

Plus listen to this --

Do you remember her? Candi Staton? She's stuck in London due to the volcanic ash, and she joins us in the CNN NEWSROOM.

(COMMERCIAL BREAK)

HARRIS: You know, Arizona's controversial bill cracking down on illegal immigration heads back to the State Senate on Monday for reconciliation. The senator who drafted the bill and an activist who opposes it faced off right here in the CNN NEWSROOM, and it was hot yesterday.

(BEGIN VIDEO CLIP)

HARRIS: This is a crime problem and --

RUSSELL PEARCE, (R) ARIZONA STATE SENATE: It's an illegal problem. It's a crime.

HARRIS: It's a crime problem, right?

PEARCE: Yes, well, it's a crime problem and they're taking jobs from Americans. Billions of dollars in costs. We spend $1 billion in Arizona just to educate the children of illegal aliens. It's a constitutional right of the citizens of this country to expect their laws to be enforced. We're going to enforce them.

ISABEL GARCIA, PIMA COUNTY LEGAL DEFENDER: Mr. Pearce is absolutely wrong. Immigrants have done nothing, but contribute to this society especially to the economy of Arizona.

(END VIDEO CLIP)

HARRIS: We've got to tell you, you can watch the entire discussion. We've put it on our blog. Man, it's hot, at CNN.com/Tony. As that discussion was taking place yesterday, 47 people, as we were talking about this issue, 47 people were being rounded up by immigration and customs enforcement officials in Arizona. They are expected to appear in federal courts today in one of the government's largest ever human smuggling busts. Our Casey Wian reports from Phoenix.

(BEGIN VIDEOTAPE)

CASEY WIAN, CNN CORRESPONDENT (voice-over): There appear to be mom-and-pop businesses, operating shuttle vans between border towns and major cities in Arizona, but they're allegedly part of a confederation of illegal immigrant smuggling rings according to immigration and customs enforcement.

JOHN MORTON, ICE ASSISTANT SECRETARY: This is the largest human smuggling operation ICE has ever conducted. And I'm quite confident at end of the day, we will have dealt a very strong and severe blow to the alien smuggling industry here in Arizona and along the southwest border.

WIAN: Hundreds of agents from nine federal and local law enforcement agencies fanned out across the state, Thursday, arresting more than 40 criminal suspects and shutting down several businesses. Here's how investigators say the human trafficking rings operated. Smugglers would help illegal immigrants enter the United States near a border city such as Nogales. They would then be transported to Tucson where one of the shuttle vans would take them to Phoenix.

Once there, they would rendezvous with another vehicle and be taken to a drop house. They will then be moved to cities all over the United States. ICE says its year-long investigation dub operation playing site found the businesses were operated by U.S. citizens and legal residents. The illegal immigrants were allegedly issued phony tickets for shuttle trips that way, investigators said, drivers could claim they were operating legitimate businesses if they were stopped by law enforcement. Immigrants rights groups criticized the timing of the raids.

JENNIFER ALLEN, EXECUTIVE DIRECTOR, BORDER ACTION: I think we're getting absolutely mixed messages. I saw that just yesterday that first lady Michelle Obama, she wants to see immigration reform happen, and then we wake up this morning and we have ICE raids intensively throughout the state of Arizona.

WIAN: ICE officials say politics played no role in the operation which they say represents a shift in enforcement strategy. For years, they've concentrated on busting illegal immigrant drop houses. Now they're after the transportation networks that supply the smuggler's human cargo. WIAN (on-camera): ICE says it has received unprecedented cooperation from the Mexican government which also arrested some suspects on the other side of the border. Agents could not say how many illegal immigrants were actually moved as part of this alleged smuggling operation, but they say that number was significant.

Casey Wian, CNN, Tucson, Arizona.

(END VIDEOTAPE)

HARRIS: Standardized test results under suspicion in Georgia. Did school officials tamper with test to meet federal standards? We're back in a moment.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

JANICE LANGBEHN, DENIED VISITATION RIGHTS: She was a pretty quiet person. She'd be pretty shocked at all the, you know, the outpouring of support that we're getting. Even at the time of her death, her memorial was overflowing because Lisa touched so many people's lives that now it's another chance to celebrate who she was.

(END VIDEO CLIP)

HARRIS: Janice Langbehn was forced to sit in a waiting room while her partner of 17 years died from an aneurism. It is a situation many gays and lesbians face, and it was her case that helped inspire President Obama to take action. An order from the president will change the relatives-only visitation policies at most hospitals. It will allow patients to decide who has visitation rights and who can consult on medical decisions including same-sex partners.

CNN's Jill Dougherty with more details from the White House. Good morning, Jill.

JILL DOUGHERTY, CNN FOREIGN AFFAIRS CORRESPONDENT: Hey, Tony. You know, this actually will affect almost all hospitals in the United States because almost all hospitals in the United States do participate in Medicare and Medicaid, and that is the legal way that they are -- that the president is now issuing that memorandum for HHS to issue the new rules. And here is how it would work. Any hospital that is receiving Medicare or Medicaid funding must allow patients to decide who can visit them. That's number one.

Then, they must prohibit discrimination based on a variety of characteristics and that can include sexual orientation and gender identity, and then finally, it would guarantee all patients advanced directives and that would be such as who can make health care decisions if the patient isn't able to do it. And Tony, as you mentioned, some of this was sparked by that case, the Janice Langbehn and her partner, Lisa Pond (ph). They've been together for 17 years.

Partner Lisa developed an aneurysm when they were in Florida, and she was actually, Janice was kept from her partner's side and plus their four children, and unfortunately, her partner died alone. So, President Obama, yesterday, actually called Janice, and Janice was interviewed by Anderson Cooper on his show and here's how she described that conversation.

(BEGIN VIDEO CLIP)

ANDERSON COOPER, CNN ANCHOR: The president actually called you today. What did he say?

LANGBEHN: That was pretty shocking. He said that he apologized for how our family was treated which is something I've been asking Jackson Memorial to do. They refused to apologize to me and our children.

COOPER: That's the hospital in Florida.

LANGBEHN: That's the hospital in Florida. They refused to apologize for the kids and I, but the president did which makes up for a lot, and then he said that he had directed HHS to this memorandum that he was signing today so that patients could decide who their family is, who their circle of intimacy was, and I thanked him because I believe this will be Lisa's legacy, that she didn't die in vain.

(END VIDEO CLIP)

DOUGHERTY: So, as you might expect, gay rights organizations are reacting very positively to this. It's certainly important for them and it's important for the Obama administration because after all, many gay voters were supporters of Obama during the election campaign, Tony.

HARRIS: That's right. All right. Jill Dougherty at the White House for us. Good to see you, Jill. Thank you.

You know, hundreds of thousands of Americans can now re-apply for unemployment benefits today as we get the top stories for you now.

President Obama has signed a bill extending payments for those who have exhausted them. It is a temporary fix, just through June 2nd. Congress will now try to fund the program for the rest of the year.

Conservatives are calling on the Obama administration to appeal a ruling on prayer. A federal judge says, the national day of prayer is an unconstitutional government promotion of religion. The White House has tweeted. The president still plans to observe the day next month. Of course, we want to hear from you on this one. This is pretty hot, huh. Do you think the country should head up a government-sponsored national day of prayer or do you think it is unconstitutional? Just go to our blog, CNN.com/Tony. Leave us a comment, and we will share some of them on the air a little later in the program.

Vacationers, business people, entertainers, they are all in the same boat because of the volcano in Iceland. We are on the phone with soul singer Candi Staton. She's stuck. We'll talk to her next in the CNN NEWSROOM. Candi Staton. (COMMERCIAL BREAK)

HARRIS: OK. Get a load of this ash. That's quite a cloud, huh? From the volcano in Iceland, pretty nasty stuff there, right? It is spewing out stuff that is way too dangerous for aircraft to fly through, that's for sure. So, basically, nothing is flying across much of Northern Europe. Then, there are all of the people with places to go and they just can't get there.

One of them is singer Candi Staton. Is Candi Staton really on the phone with me? Candi, are you there?

CANDI STATON, SINGER (via telephone): I am here.

HARRIS: Is this really Candi Staton?

STATON: Oh, yes, this is me.

HARRIS: You know, because, Candi, people like to call news channels and play little pranks. What was your big hit?

STATON: "Young Hearts Run Free," and I had a double platinum here in Europe called "You've Got the Love."

HARRIS: That's Candi Staton. That's it. How are you, Candi? How you been?

STATON: I'm doing wonderful. How are you?

HARRIS: Oh, I'm great. All right. So, you're stuck now, where were you trying to get to?

STATON: I was supposed to be in Norway tomorrow night at a festival, and they had to cancel it. But the next shows I'm doing, we can drive there, but next week, I'm trying to fly again, so we just have to wait and see.

HARRIS: OK. Have you gotten any information from your airline as to when you can maybe get out and get going here?

STATON: You know, every day, they push it back. They say, we can get you -- we're getting in the air tomorrow at 1:00 and then the next time you hear it it's like, we just don't know when you'll get back up in the air, so we're all grounded.

HARRIS: Are you getting a little frustrated?

STATON: At first, I did, but I'm starting to enjoy just being on the ground.

HARRIS: Yes, yes, OK. So, your band is with you, everyone is with you and the hotel is treating you well? They're not trying to move you out because they've got other people coming in, are they?

STATON: We had a little problem last night.

HARRIS: You did.

STATON: I was kind of worried because I was supposed to check out today and then people started crowding in because the airports were just completely closed down. And so, I had to rush downstairs and try to get a room for the next couple of days and I was able to do so.

HARRIS: So, can you see anything? I guess it's about 20,000 feet in the air. So, you really can't see anything. Is it a little strange to not be able to see the source of the problem that's keeping you grounded?

STATON: You know what? The only time you can see it, Tony, is in the evening when the sun starts to go down. It starts turning a little red. So, you know something's wrong up there, but other than that, we don't have any ash on the ground here in London.

HARRIS: Let me see here. Let me check your health here. Are you wearing a mask yet?

STATON: No.

HARRIS: How about itchy or irritated eyes?

STATON: Well, you know what? Come to think of it, yesterday, I did get a little irritated. I didn't know what it was from.

HARRIS: How about a sore throat which would be problematic for you?

STATON: Yes. I got one of those yesterday, too. So, I was lying down in bed today wondering why I had a sore throat, but that might have been, now that you mention it, is that a -- is that some of the symptoms?

HARRIS: Well, we keep hearing that the particles are too fine to really impact you. I hope it's not a psychosomatic thing. It may just be bad air where you are. Just in general.

STATON: Yes. Anyway, I'm fine. I'm great.

HARRIS: You're good. So, Candi, you're good, right?

STATON: Yes, I'm good.

HARRIS: All right. Thanks for calling us. I can't believe it.

STATON: You are so welcome.

HARRIS: Candi Staton is on the line with us. Boy, oh, boy, Chad Myers, I keep hearing that the particles are too fine.

MYERS: They're fine.

HARRIS: And that they really shouldn't cause a problem for you if you're in Europe. MYERS: Well, you know, it just depends. This volcano basically exploded in the atmosphere so it pushed a lot of things, tens of thousands of feet high so that's not where people live, but now as the ash is falling down, you will see it. If you see it on the hood of a car and then you know that it's in the air, but you know, this is what Candi was talking about, how the skies turn red.

It's the refraction. It's the reflection off of these things up in the upper atmosphere, and you know what? The frustration with the flyers is there because the airlines don't know when the ash is really going to be out of the way. I'm just saying, you know, Carol Costello has this little segment called just saying, I'm just saying, I don't want to be on the first flight in the air to see if that air is okay.

HARRIS: Good point, sir.

MYERS: Are you with me on that?

HARRIS: Yes, I am so with you on that.

MYERS: Unless, I have a parachute. I don't want to be on that plane. OK. That's just not something I'm feeling good about. Here's Iceland, the dig ash clouds are still coming in kind of from the north and from the west sliding out toward the southeast and the UK being affected here. Look, I mean, everything being affected. All the UK airspace, Dusseldorf, Cologne, Frankfurt, Berlin, all the finish airspace as well and that's all because of the way the air is now moving.

Yesterday, it was moving in a slightly different way, coming over the volcano which I will not pronounce, but you can go -- you can do a Wikipedia search and put that word in and it's -- and it sounds like something going -- it sounds like a Beatle record going backwards, OK.

HARRIS: You just had a Cosby moment there. That was terrific.

MYERS: That's what it sounds like. Yesterday, it was coming down this way. Today, it's kind of sliding off to the east, but there is ash still down here circulating from when it didn't make its way all the way down to the west of France and that has to push its way across. It will still be days for some people.

HARRIS: Yes. We are having too much fun on the Friday. I know the bat phone is going to ring here in a second. Candi Staton and Chad Myers, that's good fun. That's good television. All right. Chad, appreciate it. Thank you, sir.

I got to tell you April is national child abuse prevention month and this week's CNN hero is drawing on her own childhood experiences to save others. Wynona Ward reaches out to battered women and children in rural Vermont with the motto, have justice, will travel.

(BEGIN VIDEO CLIP)

WYNONA WARD, CNN HERO: When I was growing up on a rural back road, family violence was an accepted way of life. This is my mother, and I'm the baby here and my father and my brother, Richard, and my sister, Pauline.

My father would commonly abuse all of us. He raped me and beat my mother and my other siblings. When the neighbors heard screaming coming from our home, they just turned their heads.

For domestic violence victims in rural areas, it can be very devastating. They are out there on these back roads with no access to in-town services. Many of them do not have telephones, some of them do not have a driver's license or an automobile, so we go to them.

My name is Wynona Ward.

The turning point for me was when a child in my family revealed that she had been abused by my father and my brother. I just said this has to stop. When I graduated from law school, I was 48 years old.

Good morning, my dear.

I go to people's homes, give them in-home consultation, provide them with free legal services and transportation to and from court hearings. I don't want children to have to go through what I did as a child. I want to see my clients become empowered. I can understand them and they know that I will be there to protect them.

(END VIDEO CLIP)

HARRIS: Wynona Ward estimates she drives some 30,000 miles a year and has helped almost 10,000 victims of domestic violence.

To nominate someone you think is literally changing the world, just go to CNN.com/heroes.

(COMMERCIAL BREAK)

HARRIS: I've got to get you more now on the breaking news out of Washington, because I think this is huge and it certainly has a direct impact on Wall Street. Powerhouse Goldman Sachs -- can't understate that, a powerhouse on Wall Street -- has been charged with defrauding investors. It has to do with securities it sold involving subprime mortgages.

Colin Barr is a senior writer for Fortune.com and Colin is with us now. Now, Colin, I'm going to let you run here, but I think this is a huge story, parse it out for us, if you would.

COLIN BARR, SENIOR WRITER, FORTUNE.COM: You're absolutely right. This is very big because the sound you hear is the other shoe dropping on Wall Street. People who have been saying for years that Wall Street was playing these games where Wall Street profited from ripping people off, essentially, and here you have evidence of that. That's the SEC's allegation in any case.

And what they're saying is the two most successful firms in the subprime housing crisis, the two firms that made out best in the subprime housing crisis, Goldman Sachs and the hedge fund Paulson and Company, these guys were colluding essentially to rip people off. That is a huge, huge allegation and it shows that the SEC is back and it has teeth, a lot of people have said the SEC was nowhere. And I think everyone assumes this is the tip of the iceberg and we will see more of these.

HARRIS: Yes, because if you think about it and I don't know who this Paulson and Company is, maybe we can find out about that, but we certainly know about Goldman. But there were a lot of --

BARR: Well, John Paulson --

HARRIS: Go ahead.

BARR: John Paulson is a guy who made 4 billion. He made 4 billion shorting the housing market. And if these allegations are true, that looks a little bit less prescient and a little bit more, I'm not sure, what -- a little bit more sneaky, I don't know, is that the word?

This thing has very big ramifications for the way this is all going to be seen in the history books. And then, of course, it also has ramifications for civil suits and all sorts of other things.

HARRIS: How about the pervasiveness of this practice that we know that there were all kinds of banks involved in bundling up these subprime mortgages and selling them wherever they could find a buyer? So it seems to me, particularly in light of the fact that we've got congressional hearings going on on the financial collapse right now that groups like WaMu, the former Countrywide, that there are implications for all of those former and current financial institutions.

BARR: Well, I think that something like this is always one of the lessons that announcements like this are always good for the lawyers. I think lawyers will have a full employment act out of this. I think that we've seen other -- we've seen allegations that this was going on elsewhere. ProPublica did a story the other day about a story called Magnetar involved in this sort of thing and there were Wall Street banks involved in that as well.

And so, I think that the kind of legal angle of all this is that Wall Street potentially will have to pay out a lot of money and is going to be very busy fighting these kinds of allegations over the next couple of years.

HARRIS: Hey, Colin, is there a trickle down -- go ahead, make your point.

BARR: The other thing is this is just -- I would assume that we are going to eventually see, maybe not in this case, but somewhere along the line we're going to see the Justice Department get involved in this sort of thing, too. Once again, we haven't seen a lot of that. We haven't seen a lot of that. People are saying where are the perp walk. There was obviously a huge amount of fraud in the subprime area up and down the line.

HARRIS: Yes.

BARR: When will we see someone go to jail for that?

This is not that. This is a civil case and no criminal allegations. The SEC is not commenting on any Justice Department referral here or anything like that. But you know, everyone is now looking for that, too. We're expecting to see something like that at some point because it is obvious that there was a lot of very brazen stuff going on.

HARRIS: OK. So the that we're talking about at this point is the charge of defrauding investors, but look, we're talking about individual homebuyers who will be making potentially a stronger case now that they were defrauded, correct?

BARR: Absolutely. You referenced WaMu. I mean, there's the hearing on WaMu earlier this week in the Senate.

HARRIS: Absolutely.

BARR: And I mean the materials that senate investigation committee pulled up on that are amazing. WaMu knew that there were mortgage offices that they had where 83 percent of the loans were fraudulent, you know, five and six loans being made were fraudulent and they did almost nothing about it.

So, I mean, obviously the price of this is going to be paid for a long time. It's already being paid by individual home owners and by investors, and I think the people who were involved in this thing and who made out on it are going to pay the price eventually. It's taking a long time.

HARRIS: Well, yes and it finally feeling like we're getting the rub on this.

Colin Barr, senior writer for Fortune.com. Colin, appreciate it. Great hustle on this. Thank you, sir.

BARR: Thank you.

HARRIS: Schools around the country learning some tough lessons in economics. Another district announces major job cuts and school closings.

We're back in a moment.

(COMMERCIAL BREAK)

HARRIS: Let's get you caught up on top stories now.

Senators investigating the Fort Hood shooting spree say the Obama administration is putting up road blocks. They are threatening to issue subpoenas on Monday unless the Departments of Justice and Defense turn over documents. (BEGIN VIDEO CLIP, "JOHN KING USA")

SEN. SUSAN COLLINS (R), MAINE: What's really frustrating to me is the White House has made available information to its handpicked investigators. We're asking for that same kind of access to people, to documents so that we can put together what happened.

(END VIDEO CLIP)

HARRIS: Yes. Makes sense.

The man who ran the Los Angeles Police Department during the 1992 riots has died. Former Police Chief Daryl Gates was known for a prickly style and a short fuse, his handling of the riots led to his resignation. Daryl Gates had been battling bladder cancer. He was 83 years old.

(COMMERCIAL BREAK)

HARRIS: An estimated 6 million Americans will travel abroad for medical procedures this year. CNN's Dr. Sanjay Gupta follows a woman on her way to Mexico for weight loss surgery.

(BEGIN VIDEOTAPE

DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT (voice-over): It's 10:00 a.m. in San Diego and Sharon Howell is just arriving on a flight from Atlanta, but she's not here for vacation. She's heading south to Tijuana to have laparoscopic banding obesity surgery.

SHARON HOWELL, BARIATRIC TOURIST: Well, I attempted to make the surgery back in the states and the insurance company made it extremely difficult.

GUPTA: So, Sharon decided to be a medical tourist.

HOWELL: We all looked up the facility, the physician, saw that he was highly credentialed.

GUPTA: Her experience so far?

HOWELL: Incredible.

GUPTA: And the price tag? About $6,000, that's less than a third of the cost in the United States without insurance.

PAULO YBERRI, DIRECTOR, HOSPITAL ANGELES TIJUANA: It's a different economy, different cost structure. Insurance costs for the facilities, for the doctors, it's a bunch of different factors that if you add them up, sum up to a lower cost, but it does not in any way affect the standards of quality.

GUPTA: But there can be risks when seeking care abroad, so says Emory University's Dr. John Sweeney.

DR. JOHN SWEENEY, CHIEF OF BARIATRIC SURGERY, EMORY UNIVERSITY: The issue is the long-term follow-up and the continuity of care that is going to be difficult to achieve.

GUPTA: Also, it's important to research the types of certifications both the hospital and the surgeon hold. And patients should be prepared to pay out of pocket for complications that may arise once they return home. Those who receive poor or damaging treatment abroad often have no legal recourse.

But Sweeney does note, just because a hospital is outside U.S. borders doesn't mean it's bad.

SWEENEY: We tend to be very closed minded and realize that hey, there are countries outside of the United States that do it as well as we do or better.

GUPTA: As for Sharon, she says all of the travel has been worth the cost savings.

HOWELL: I mean, I work at a hospital institution and this is very well run.

GUPTA: Dr. Sanjay Gupta, CNN, reporting.

(END VIDEOTAPE)

HARRIS: Of course, you can get more information on CNN.com/fitnation.

Also this weekend on "SANJAY GUPTA, MD", a colorful conversation with Chef Jamie Oliver on how to fight obesity and why he's so passionate about it. That's at Saturday and Sunday at 7:30 a.m. only on CNN.

(COMMERCIAL BREAK)

HARRIS: Oops. I don't know if I sold that. April 15th has come and gone and you haven't filed your taxes yet? Well, don't worry. Really? All right. Ines Ferre is here to help you minimize those penalties.

Ines, good to see you. So where do we start? Where do we begin with this process?

INES FERRE, CNN CORRESPONDENT: OK, Tony, let's say you haven't filed. The best advice here is to act immediately. Interest and penalties begin from the date that taxes are due, and the penalties can be severe.

If you owe the government $300, let's say, and you file your return between now and May 15th, you'll pay a 5 percent penalty fee. That's $15. Add another $1.50 a month for not paying on time, plus you'll owe monthly interest. If you don't file your taxes within two months, you'll be responsible for $135, Tony.

HARRIS: Wow. What's the best strategy for making sure your paperwork gets to the right place? FERRE: So if you're paying by check or by money order, make sure that you make it out to the U.S. Treasury, not the IRS. Put your tax year on it, include your Social Security number and form 1040 on the check. You want to make sure that your payment is associated with your return. And as a follow-up, you can always call the IRS at 1- 800-289-1040 to make sure that the money was received, Tony.

HARRIS: OK. And it's more important to file than to pay, is that correct?

FERRE: Yes, it sure is. If you can't pay, file anyway. Call the IRS to see if you can get on some sort of installment plan. And as you can see, the penalties are much stiffer for folks who don't file or those people who can't pay. So you want to make sure that you file.

HARRIS: Gotcha, very good. And next hour, tell whoever that is behind you to pipe down. We're trying to do some television here. You have important information we need folks at home to hear.

FERRE: That's right. OK, will do.

HARRIS: I'm in a mood today.

All right, Ines. See you next hour.

FERRE: See you.

HARRIS: And coming up on "YOUR BOTTOM LINE" this weekend with Stephanie Elam, the five best uses for your tax refund. Nearly 90 percent of Americans are set to receive refunds at an average of $3,036. That's pretty good. That's actually up 10 percent from last year.

Also on the show that saves you money, the best of jobs for grads right now, how to save big bucks on your utility bills and how to spot the red flags when it comes to mortgage fraud. All that and much more. I don't think there's anything left. Didn't I tease everything? "YOUR BOTTOM LINE" Saturday right here on CNN.

And here's what we're working on the next hour of CNN NEWSROOM.

Floating ash from Iceland's volcano closed or partially closed airspace in much of Europe. How is it affecting you U.S. airbases overseas? CNN's Barbara Starr joins us with that.

And this week's powerful earthquake left tens of thousands of people in western China homeless. Survivors and rescuers are battling freezing temperatures and thin air in the remote region where the quake struck. We will have a report from John Vause coming up next hour in the CNN NEWSROOM.

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HARRIS: School districts across Georgia began standardized testing this week, and they've come under more scrutiny after suspicions last time around. An audit found an unusually high number of answers had been erased on thousands of tests. CNN's Don Lemon looks into whether tests had been tampered with to meet federal standards.

(BEGIN VIDEOTAPE)

DON LEMON, CNN CORRESPONDENT (voice-over): Mikole Harden is worried.

(on camera): Are you the only parent concerned about the forms?

MIKOLE HARDEN, PARENT: No, by all means.

LEMON (voice-over): Someone may have changed the answers on the standardized tests at his daughter's school last year.

(on camera): But you have concerns in.

HARDEN: Of course I have concerns. Like any other parents, I have concerns. I hope that there's no cheating. And if it is cheating, there needs to be a punishment for it.

LEMON (voice-over): And he's not alone. The state of Georgia is investigating 10 percent of its elementary and middle schools, 191 of them, because of moderate to severe concern over test results in 2009.

(on camera): When the answer sheets like these were scored, the computer scanners could tell when the bubbles were erased and the answers changed.

(voice-over): Kathleen Mathers heads the state audit.

KATHLEEN MATHERS, GOVERNOR'S OFFICE OF STUDENT ACHIEVEMENT: It's not that someone changed a bunch of answers. It's when that they changed answers, they got the answer right as a result of that change.

LEMON: Classes with an unusually high number of these changes were flagged.

MATHERS: It's sort of like having a blizzard in Ft. Lauderdale in the middle of July. You know, in theory, it could happen, it's just so incredibly unlikely that you really need a substantial explanation.

LEMON: Usually when we talk about cheating, the focus is on kids. In Georgia, the finger is being pointed at teachers and administrators.

CNN obtained affidavits in the case of two administrators at an elementary school in DeKalb County accused of tampering with test in 2008. Former principal James Berry admitted they went into an office and "...began to erase answer sheets and change answers."

Dorethea Alexander, the assistant principal, says she read the answers to Berry. "He needed for 26 students to pass for us to make AYP." AYP is adequate yearly progress, an improvement standard set by the No Child Left Behind Act. Schools that repeatedly failed to meet AYP faced sanctions.

Berry was charged with public records fraud, paid a fine and is on probation. Alexander was transferred and completed community service.

MATHERS: We have done some work with our monitors.

LEMON: Today, Mathers is working with the state school board to keep it from happening again.

MATHERS: As a former teacher, I would say we're better than that.

LEMON: Georgia students are now taking the 2010 CRCT tests under new guidelines. And watching over the whole process? State test monitors aimed at making sure these tests can be trusted.

(END VIDEOTAPE)

HARRIS: OK, tune in this weekend for a CNN Special Report, "FIXING AMERICA'S SCHOOLS" a town hall moderated by Don Lemon. It features Education Secretary Arne Duncan and an audience of parents, students. "FIXING AMERICA'S SCHOOLS" Saturday at 7:00 p.m. Eastern time.