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New York Times Reports, Trump Paid Just $750 in Federal Taxes in 2016 and 2017; Ransomware Attack Ahead of Election Raises Fears about State and Local Government I.T. Systems; New Cases on the Rise, Only Ten States Show Downward Trend. Aired 1-1:30p ET

Aired September 28, 2020 - 13:00   ET

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

JOHN KING, CNN INSIDE POLITICS: And it is debate night.

[13:00:01]

Thanks for joining us today. Brianna Keilar picks up our coverage right now. Have a good day.

BRIANNA KEILAR, CNN RIGHTNOW: Hi there. I'm Brianna Keilar, and I want to welcome viewers here in the U.S. and around the world.

For years, President Trump has battled to keep the truth about his finances out of the hands of Congress and away from the American public. A sweeping new report from The New York Times shows why, because while many of you were shelling out money to the IRS every April, the president was not. Not one dime in federal taxes for 10 out of 15 years spanning from 2000 to 2015. This is according to more than two decades of tax records that reviewed by the paper.

And in 2016 and 2017, the years that he did pay, he only paid $750 each year. That's less than the stimulus checks sent to millions of Americans to blunt the impact of COVID, an amount that many said could barely cover their rent or other basic needs.

So how did the president do it? By declaring, according to The Times' analysis, hundreds of millions of dollars in losses, losses that Trump then used to avoid paying the IRS.

And as for the money that he does make, during the president's first two years in the White House, $73 million from overseas, mostly from the golf courses, but also from licensing deals in several countries, including Turkey and the Philippines.

And he also brings in money from other businesses that he has refused to divest from, among them, D.C.-based Trump International Hotel, which has seen a rise in business from those eager to get in the president's good graces, even as the property loses money overall.

None of this though is enough to offset what lies ahead, loans and debts totaling, per The Times, a staggering $421 million with most of it coming due within the next four years. And that means a second term could make Trump, who is personally responsible for much of it and the office of the presidency, vulnerable.

I want to bring in Adam Davidson, he is a Writer for The New Yorker. He has been closely following Trump's finances, in particular, the president's golf courses, which The Times reports, are bleeding money.

Adam, what is your takeaway from this expose?

ADAM DAVIDSON, WRITER, THE NEW YORKER: Well, it's fabulous work, obviously, by The New York Times that really fleshes out a picture that largely has been known at least by financial journalists but this really adds rigor to the case that this is a lousy businessperson who is in serious debt and plays very fast and loose with tax laws.

KEILAR: Okay. So, paying no taxes, paying $750 in taxes, right? These are like meager payments. His supporters might just say, look, he was smart, he is able to do this and he did it. So that brings us to the question, is he using the tax code as he legally can or are there signs that this could be tax fraud?

DAVIDSON: There's lots of signs this could be tax fraud. There's also lots of signs that this is not the work of a great mind, certainly not a great business mind. You can say that Trump's dad, Fred Trump, is the guy that supporters seem to think he is.

He was a relatively self-made guy. I mean, his mom helped him out but Fred Trump made a proper fortune by building housing for poor people and middle class people in the outer burrows and did a lot of tax fraud to keep as much of the profits for himself. And that's a story that has been well reported by The Times and that we know well.

This tells us a very different picture. Trump is both doing things that are very questionable on his taxes but he is also not able to sustain his businesses. And so it is a combination of corruption and ineptitude, truly bad business, being a very bad businessperson who just lucked out being the son of a rich person. And then we now see that The Apprentice is really the thing that kept him afloat for much of the last 20 years.

KEILAR: And you laid out some very interesting points in your tweets since this story broke. So let's start there. He has hundreds of millions of dollars in debt that coming due in the next few years. And, as you said, once that money dried up right from The Apprentice, you note that in 2011, he gets an unknown source of income, funding, that he would need. Since that money also from his dad and The Apprentice dried up, who does the president owe money to?

DAVIDSON: We don't know, and that is really, really important. It's important for national security reasons.

Look, this is a guy who spent other people's money. He is quite open about it. He is quite proud of it. He said it on the campaign trail. He spent other people's money. He spent his dad's money and he spent banker's money. And then in the mid-2005 to 2010, he spent Mark Burnett's money and money that he made from The Apprentice.

[13:05:00] But his real crazy spending, this is what The Times points out, where he's spending way outmatches any sort of revenue starts in 2011. And we just cannot figure out, The Times doesn't know, nobody knows where that money came from. It doesn't seem to have been generated by his own businesses. So it raises the question, where did it come from?

Now, what I point out, I don't have any proof, but it is quite telling -- well, I do have proof that in 2011, he started doing business with the Mammadov family in Azerbaijan, corrupt oligarchs who laundered money through golf courses. In 2013, he started doing business with the Azerbaijani Russian family, the Agalarovs, corrupt people who laundered money through golf courses. And at that exact time, Trump is spending hundreds of millions of dollars on golf courses, money he can't afford.

Now, are they the ones who gave him the money? I don't know. Someone with subpoena power needs to find out. But, certainly, there is evidence that he owes somebody a ton of money and those people know a lot about him and his life is dependent on him, his financial life anyway. And we need to know. We need to know who the president owes money to.

KEILAR: Yes, it's so important. Adam Davidson, thank you so much for being with us and walking us through this.

DAVIDSON: Thank you, great to be on.

KEILAR: It's great to have you.

Now, fairness is one thing but whether the president's tax returns are legally on the up and up is another. The reports in The New York Times could open him to prosecution after he leaves office, whether that's in four months or in another four years.

CNN Legal Analyst Paul Callan is joining me to talk about this. He's former New York prosecutor and of counsel with Edelman and Edelman.

Okay. So what are the legal, potential liabilities that the president faces in the near term and perhaps once he leaves office?

PAUL CALLAN, CNN LEGAL ANALYST: Well, Brianna, it is interesting that this article comes out now because, of course, the president's tax returns are finally under criminal subpoena in an investigation in New York City by the New York D.A. So we know that those returns are going to be looked at very, very carefully and it is a criminal investigation, not a civil investigation.

In looking over The New York Times' allegations, I think that the strongest thing the president may have to worry about are the claims that he overestimated the value of properties that he owned in order to facilitate bank loans.

Now, what happens in that situation? You tell a bank that a property is worth a lot more than it really is to sustain a bigger mortgage. That can be tax fraud. When you do that because or it can be fraud as against the institution. Remember, most of these banks are federally chartered banks so there are federal crimes involved, not just tax crimes but others involving fraud.

So I think that's an area that these revelations indicate the president may have something that he should be worried about.

KEILAR: And you heard what Adam Davidson was laying out there about some of the affiliations that President Trump had in the last decade. Could this be money laundering?

CALLAN: Well, anything is possible here and I don't -- it is not fair for me to go out on a limb, I think, to say he is a money launderer. But I have to say, when you look at somebody who has lived as lavishly as President Trump did, even before he was president, with the helicopters and the planes and the gold-plated apartment on 5th Avenue, and we find out that in The Times that in 11 out of 18 years of tax returns that they have looked at, he paid really no taxes at all or $750 in taxes. It's really a staggering figure.

Now, I mean, common sense would say to you that there's something that's not right here, but you'd have to have all the records and really go through them in detail to see if criminal conduct has occurred. I mean, on the face of it, it looks suspicious but that's about as far as you can take it now.

KEILAR: The IRS should have enough details, right?

CALLAN: Well, they have. And if the --the president's been dodging the release of these tax returns for a very long time, from the time he started running for president, saying he's under audit. Now, if that, in fact, is true, the IRS probably has been looking over these records.

And, of course, one of the things that The Times dealt with earlier in a series that they ran on his finances was that a lot of his success arose, frankly, from Atlantic City and the collapse of the Taj Mahal and other situations down there, where he kind out of this situation where he had tremendous amounts of debt. But what he generated was the ability to have tax losses that he could post as against income in future years.

[13:10:02]

And I'm betting that when you really get into the details of all of the tax returns in question, you're going to find that he has been carrying what he says were losses that occurred in prior years to pro- event him from paying taxes currently. And whether that's an illegal use or a tax dodge, that would be up to the IRS.

KEILAR: Yes. And we do know he's under audit. We know that there was a $70-plus million refund that he got that is currently kind of tied up, it's sort of stalled right now, as it is being evaluated to make sure that it was or maybe was not on the up and up.

Paul Callan, thank you so much. I really appreciate it.

CALLAN: Thank you, Brianna. KEILAR: And The New York Times is reporting that in just a couple years, Donald Trump is on the hook for hundreds of millions of dollars in personally guaranteed loans. These are personally guaranteed. So if he is re-elected, that money comes due while he is in the White House. How much of a potential national security threat might that be?

Let's discuss this now with former FBI Deputy Director and CNN Senior Law Enforcement Analyst Andrew McCabe. He is also the author of the book, The Threat, How the FBI Protects America in the Age of Terror and Trump.

And, Andrew, according to The Times, the president has $421 million in debt which he is personally guaranteed, most of which is coming due here over the next few years. What are the national security implications of that?

ANDREW MCCABE, CNN SENIOR LAW ENFORCEMENT ANALYST: So, Brianna, the existence of financial peril or disorder in someone's life is always a key factor in determining whether or not that person might be vulnerable to influence or a pitch or recruitment by a foreign entity.

So it's one of the first things that we as investigators look at when we're trying to figure out if someone has actually gone to the other side and is now working with a foreign government. Were they motivated to do so by finances? We have seen in many cases that that's, in fact, what happens.

I have to tell you that in all of those cases I have seen, I have never come across an individual who was actually facing debts that were coming due on this magnitude. I mean, $400 million in the next two or three years is an extraordinary number.

We also have some serious questions about where those debts are from. As your previous guest mentioned, we don't know where Donald Trump has borrowed that money from. That information doesn't appear to be in the records we have seen so far. And if that money is from foreign sources, then it really opens a Pandora's Box about foreign influence issues with the president of the United States. It does not get any more serious than that.

KEILAR: So, just for someone who is seeking a security clearance, if we're talking more generally here, what is the amount normally that would make reviewers say, that makes this person susceptible to being recruited or susceptible to foreign influence? What's the amount?

MCCABE: There's no specific. But what we're usually talking about in those cases are government employees, people who make a good salary but live on a salary of, you know, $100,000 a year, $125,000 a year, something like that.

So, for a person in that situation, you could simply be behind on a number of credit cards, and that would cause a red flag to these background and security clearance investigators, a mere pittance compared to what the president is facing in the next few years.

So, I mean, I have seen people really go to extreme measures over not being able to pay their rent and their mortgage and being behind on credit cards, student loans, debts to finance their children's educations, just like fractions of a fraction of what we're talking about here.

KEILAR: Yes. I do want to turn to the election and worries about how safe it is from hacking. Because we are learning Tyler Technologies, that Texas-based firm, that supplies data visualization software to some U.S. election officials, has been hit by hackers. The company says its internal network and phone systems were targeted in a ransomware attack. It says that its software that can format and display election results, campaign finance data and information of polling places was not targeted in the attack. Does this worry you though?

MCCABE: Greatly, greatly. So, it is important for your viewers to understand that companies like that, particularly in politics and elections, and just big companies, in general, are constantly subject to what we call probing by cyber adversaries, be it foreign government or criminal actors.

We saw a lot of that in 2016. We saw the Russians probing the networks of voter registration systems and things like that in all 50 states. It is very different if that cyber actor actually gets into a system and can have access to the data that they seek. So it's like ground ball compared to a grand slam.

[13:15:03]

So if that's happening in election sensitive systems around the country, we have a lot to be very, very concerned about.

KEILAR: All right. Andrew McCabe, thank you so much.

MCCABE: Sure.

KEILAR: Coronavirus cases and hospitalizations are rising across America, and this includes at an alarming rate in New York City. So we are going to take you there.

Plus, the director of the CDC is overheard talking about the controversial task force doctor who has become a proxy of the president's? Hear what was said.

And new reporting on the president's former campaign manager's hospitalization after reportedly threatening to harm himself while being armed.

This is CNN's special live coverage.

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KEILAR: As temperatures begin to drop across much of the country, that means fewer social distancing events outdoors and more folks indoors. And we are seeing coronavirus cases skyrocket across the nation. The U.S. is now averaging around 44,000 new cases a day.

Dr. Anthony Fauci, who had expressed hope that the U.S. could get its new daily case numbers down to 10,000 a day is acknowledging reality that we are reporting four times that number with no signs of it slowing down ahead of the flu season.

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DR. ANTHONY FAUCI, DIRECTOR, NATIONAL INSTITUTE OF ALLERGY AND INFECTIOUS DISEASES: Well, we are not in a good place with regard to what I had said back then. Because as we get into the fall and the winter, you really want the level of community spread to be as low as you possibly get it, and I hope not but we very well might start seeing increases in deaths.

That's really something that I had discussed sometime ago is something you don't want to be in a position like that as the weather starts getting cold. So we really need to intensify the public health measures that we talk about all the time.

(END VIDEO CLIP)

KEILAR: 21 states are experiencing an increase in new cases this week, that's compared to last week, and a national study examining the blood of more than 28,000 people undergoing dialysis found just 9 percent had antibodies for the virus.

Now, one of the study authors said, quote, we haven't come close to achieving herd immunity.

Now to trouble brewing within the coronavirus task force. A source is saying that the head of the CDC, Dr. Robert Redfield, has serious concerns about a top adviser on the task force and the information that he is feeding the president. An NBC journalist reportedly overheard Redfield saying that Dr. Scott Atlas gives, quote, false information.

CNN's Nick Valencia reports on what specific details from Atlas are raising red flags. Nick?

NICK VALENCIA, CNN CORRESPONDENT: Brianna, this is noteworthy because this is the first report we're hearing where Dr. Robert Redfield has been publicly critical of Dr. Scott Atlas. In recent weeks, the two men have provided contradictory statements to the public surrounding things like the efficacy of masks, as well as how many Americans are still susceptible to this virus.

NBC now reporting they were on a commercial flight on Friday with Dr. Redfield from Atlanta to Washington, D.C., in which they overheard Dr. Redfield on a phone call with a colleague saying, everything this man says is false, referring to Dr. Atlas.

The CDC said that NBC News is reporting one side of a private phone conversation by CDC Director Dr. Robert Redfield that was overheard on a plane from Atlanta Hartsfield Airport. Dr. Redfield was having a private conversation -- a private discussion, rather, regarding a number of points he has made publicly about COVID-19.

Now, we should point out that Dr. Atlas is not an epidemiologist. He has no expertise in infectious disease. But at this point, he appears to be one of the top advisers to the president surrounding the coronavirus. We have reached out to Dr. Atlas, as well as the White House, we have not heard back. But, clearly, some of the things that Dr. Atlas has said is concerning to many in the public health community, including CDC Director Dr. Robert Redfield. Brianna?

KEILAR: Nick, thank you so much.

Dr. Chris Pernell is a physician at Newark University Hospital, she lost her father to coronavirus and is also a volunteer for a COVID-19 vaccine trial.

Dr. Pernell, I want to start by getting your reaction to the head of the CDC expressing concerns about Dr. Scott Atlas, another doctor on the task force, saying that he's sharing misleading information about the virus with the president.

DR. CHRIS PERNELL, PHYSICIAN, NEWARK UNIVERSITY HOSPITAL: If what was being reported is true, then kudos to Dr. Redfield. He is in a position where we need him and the CDC to safeguard the public.

We need the misinformation and even the disinformation to stop. And even what I saw this weekend with the HHS secretary in the Rose Garden without a mask and fist-bumping, those types of behaviors are reckless. And we need the public health community, those public health experts, to sound the alarm and to reinforce what the public needs to do to stay safe.

KEILAR: New York City right is seeing cases grow at an alarming rate, and that is specifically in neighborhoods, in Queens and Brooklyn, and the city just had its highest number of cases that we've seen there since early June. Are you worried for a city certainly that has come so far from where it was ground zero in the early of the pandemic?

PERNELL: Yes, Brianna. We have to remain vigilant, right? So we have to follow the public health science and follow the public health data. It is important for us to track those test positivity rates, for us to track those new cases, and as soon as we see a spike, to double down and reinforce those infection prevention guidelines which we know can keep communities safe.

And particularly for me, I'm looking at it through a health equity lens. I want to know what makes those communities more vulnerable. Why are we seeing these spikes? So we've got to double down, do the work, do the science and we need leaders to lead. We need leaders not to get in the way of that public health science.

[13:25:00]

KEILAR: I want to fact check something with you that we heard from a White House spokesman earlier on CNN who was essentially minimizing the impact of coronavirus by saying the treatments of coronavirus have improved. What do you say to that, this idea that the treatment has maybe improved enough that we should be less concerned about getting coronavirus?

PERNELL: Well, that's just -- that's disrespectful. That's disrespectful to the 200,000 lives plus that were lost. That's disrespectful for the over 7 million case that we have seen in the United States. We know what the data has shown us.

And we know that, in particular, black and brown communities have borne a disproportionate burden of this pandemic while things are emerging, new interventions are being considered. We don't have the answers yet.

And we cannot relax and we cannot allow people to go forward and to spew things which we know not to be true.

KEILAR: You know the cost, Dr. Pernell, very well.

PERNELL: Very well.

KEILAR: And thank you so much for being with us again.

Just a short time from now, the president will face reporters as we finally hear the secret about his taxes.

Plus, Carl Bernstein is going to join me live on why he says this con is a big house of cards that's about to fall.

And we're going to show you some of the president's old tweets that foreshadow the current trouble he is facing.

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