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New York Attorney General Targets Trump Organization; President Biden Set to Hold Press Conference. Aired 1-1:30p ET

Aired January 19, 2022 - 13:00   ET

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

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JOHN KING, CNN HOST: Thank you for joining us INSIDE POLITICS as well. We will see you back here this time tomorrow.

Ana Cabrera picks up our coverage right now.

ANA CABRERA, CNN HOST: Hello. I'm Ana Cabrera in New York.

Thank you for being with us. The president facing tough questions and several crises, as we count down to his press conference this afternoon. As President Biden approaches one year in office, he looks to reset the trajectory of a presidency struggling to gain traction, key agenda items hitting roadblocks within his own party, COVID cases hitting record highs, his approval rating slipping.

He is plowing forward in the shadow of a predecessor whose conduct remains in legal limbo, if not peril. We are learning of new subpoenas for Rudy Giuliani and others in the January 6 probe, as Trump's legal team mounts a last-minute challenge to today's scheduled release of Trump White House records.

And the New York attorney general turning up the heat on the civil investigation of the Trump Organization, citing significant evidence, she says, of financial fraud. And she's asked a court now to compel Donald Trump and his children Don Jr. and Ivanka to testify under oath.

But let's begin with the current administration and CNN's Jeff Zeleny at the White House.

Jeff, President Biden will no doubt field a lot of tough questions today from reporters in this rare and consequential moment he's in. What should we expect?

JEFF ZELENY, CNN CHIEF NATIONAL AFFAIRS CORRESPONDENT: Ana, there's no doubt that this is the end of the first term, but so many challenges and crises linger into the second term, which begins tomorrow.

The president, we are told, is going to tout those accomplishments. Remember that infrastructure bill, that bipartisan bill passed last year. That COVID relief bill passed in the early part of the year, but, since then, there, of course, has been a string of setbacks. So, yes, the president will tout those accomplishments.

But the White House also knows, talking to a variety of advisers, that the president, also has to acknowledge the current moment, has to acknowledge the setbacks and the struggles that he has had to turn the page into the second turn.

But one question we have, is he going to certainly reset his administration, but also reset the expectations for Democrats? One of the things here is, the divisions among Democrats between progressives and moderates.

In the Senate, just a couple of moderates here, and we have seen it playing out on the voting rights bill that's going to be -- that's going to fail after the president's news conference. Is he going to try and reset expectations for the broader party here?

He has a very narrow majority. So perhaps the ambitious agenda he has laid out is simply not going to get through. But, of course, he will be taking questions on a variety of fronts. But one thing, talking to advisers, he knows he will have to acknowledges the issue with COVID- 19 and testing.

He has acknowledged it before, that he wishes he would have had more tests earlier. Now, of course, that Web site is under way, rolled out this morning, where Americans can simply sign up and get tests sent to their homes. Masks are being distributed for free. So there are steps being taken.

But the question is, when will normality continue going into this year? So many, many questions. We will see how reflective he is on this first term in office -- or first year in office, I should say. Of course, he was the most seasoned president in modern time elected. He knows that presidents, their fortunes go up and down.

The question is, what does he have to do to get his back up again, Ana?

CABRERA: Jeff Zeleny, thank you for setting the table for us.

ZELENY: Sure.

CABRERA: Let's discuss now with our chief political analyst, Gloria Borger.

Gloria, what will you be watching for at today's press conference?

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: Well, first of all, I think, as Jeff said, you're going to see and I will be watching for a dose of humility. He's done this before, but a president who has to say, look, we

miscalculated on Omicron. We didn't expect it. We didn't have enough tests. I doubt he's going to admit that he spent too much time trying to negotiate Build Back Better, in which case it looked like he was being led by Democrats, rather than leading Democrats.

But the big thing I'm going to look for is a president who is ready to say, OK, we're going to need a course correction. This is what we're going to do. We are going to try and pass parts of Build Back Better, rather than the whole plan. We're going to try and get prescription drug benefits, which people want, universal pre-K, which people want.

And, most of all, I think, he has to kind of take the reins and look like a competent leader. I think, throughout this first year, that lots of questions have been raised about competency. I think it goes all the way back to the way Afghanistan was handled. And you saw his poll numbers starting to dip at that point, and they haven't recovered.

This is a president who has bled his support with independent voters. Those voters believes that he ran as a moderate and governed as a liberal. So we have to kind of do a reset here. I'm going to be looking for that with a president who sort of takes charge again and says, this is what we're going to do, this is what I'm going to get done, and not dwell on the past, but talk about the future and what he's going to do for Americans who are worried about -- not only about the pandemic, but about inflation and about what's going on abroad.

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So, again, he has to lead and not act like he's being led by external events.

CABRERA: Yes.

He's facing an uphill climb right now...

BORGER: Sure.

CABRERA: ... because momentum is completely in the opposite direction that would he want it to be.

And given a 50/50 Senate and a very partisan Washington, that's very different from the time he was V.P., let alone when he was in Congress, I assume President Biden knew it wouldn't be easy to deliver on his promises. But do you think he expected the opposition that he's seeing from inside his own party?

BORGER: No, I don't think he did expect it. I also don't think he expected people who resist vaccines the way they have resisted vaccines.

And this is someone who was in the Senate for 36 years, and was vice president for eight. But this is a very different place. And I think he had to learn that. I mean, he prefers the kind of quiet backdoor diplomacy, OK, I'm going to have Joe Manchin down in the White House, I'm going to have Kyrsten Sinema,down to the White House, we will jawbone this thing, and maybe we will make it work out.

It doesn't work that way. And I think he learned that the hard way. And, as a result, he allowed the divisions within the Democratic Party to fester publicly for months, and looked as if he just wasn't in charge. And the American public was watching that and saying, wait a minute, you're supposed to be the guy in charge here of your own party.

And if you have to prove that you can run a governing majority, even with a slight margin, then you ought to do it. But presidents over -- always overestimate their mandates, I believe. And I think Biden did the same thing.

And in talking to White House sources, it is clear to me that goes back to COVID, and that he saw that there was such a crisis in the country, that I think, instead of trying to be a transitional president, he set out trying to be a transformational president.

CABRERA: But when you talk about him taking control, he hasn't always even taken control of the message. He's sort of missed opportunities to communicate more with the American public.

He's had the fewest press conferences during his first year in office compared to his recent predecessors. Why do you think that is? And what do you see as the impact of those potential missed opportunities?

BORGER: Well, I think the reason they haven't done it is, they probably think he's not terrific at it.

So what they have done -- and they're right about that. So what they have done is, they have put him in smaller settings, town hall settings, for example, where he can kind of jawbone with voters. And he comes out and makes these announcements and then goes back into the Oval Office.

I think the press conferences are not his best setting. And so the White House staff has tried to protect him. But, as a result, what occurs is that the press conference we're now going to watch at 4:00 is going to be seen under a microscope. And because the American public doesn't get to see Biden in an extended setting, he's going to be judged really, really carefully, whereas, if you saw him more often, you might take any mistake in stride.

He's been known to make a lot of mistakes. He did that when he was in the Obama administration. So I think that they have tried to protect him, but, as a result, it doesn't help him.

CABRERA: It amplifies the mistakes when he does put himself out there.

BORGER: Sure, absolutely.

CABRERA: Gloria Borger, I appreciate your analysis, as always.

Let's turn now to the deepening investigation into the Trump Organization and potential financial fraud. CNN's Kara Scannell is joining us now.

Kara, fill us in on the new filing by the New York attorney general. What have investigators uncovered?

KARA SCANNELL, CNN CORRESPONDENT: Well, in this lengthy filing late last night, the New York attorney general, Letitia James, outlines what she says are a number of misstatements and possibly fraudulent statements, in fact, that are in -- that the Trump Organization has given to banks and lenders.

And the heart of this is that she wants to get the former President Donald Trump, his son Donald Trump Jr. and Ivanka Trump to testify, saying that she needs to know what they know about her findings.

So what she described is this. She said: "The office of the attorney general has collected significant additional evidence indicating that the Trump Organization used fraudulent or misleading asset valuations to help obtain a host of economic benefits, including loans, insurance coverage and tax deductions."

Now, according to James, this covered a number of Trump's properties, office buildings, as well as golf courses. She lays out a number of these alleged misstatements here. Ticking through them, she says that they overstated the size of Trump's Trump Tower penthouse. They mischaracterized the assets outside of Trump or the Trump Organization's control as cash on their financial statements, when he didn't actually have control of that money.

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They also allege that they misstated the process by which Trump or his associates came up with these valuations that were on these financial statements, and that they failed to use fundamental techniques, evaluations, breaking from the norm to come up with the numbers that they wanted.

They also allege that they misstated the purported involvement of outside professionals in reaching the valuations, and they failed to advise that certain valuation amounts were inflated by an undisclosed amount for brand value.

Trump had in these financial statements given a certain amount of value to what he considered the Trump brand. And that came up previously with Michael Cohen showing financial statements to Congress. We saw this brand value appear out of nowhere from one year to the next of $4 billion.

Now, specifically, she points to a number of these properties. And these were properties that had the involvement of Donald Trump's children, Donald Trump Jr., Eric Trump, and Ivanka Trump. And it goes through tick by tick of where they say that these numbers had changed.

Seven Springs, that's the family compound in Westchester County. In 2012, it was valued at $291 million. But they said the appraisal value that the Trump Organization had that was not disclosed actually put it at $56 million. So they're wanting to know, why did that change?

The Trump triplex, that's Donald Trump's home in Trump Tower in Manhattan, in 2016, it was valued at $327 million, on the basis that it was 30,000 square feet. But, in 2017, they recognized that it was really only 10,000 square feet and revised that number to $160 million.

Now, Trump's chief financial officer, Allen Weisselberg, gave some testimony to the New York attorney general's office. He acknowledged in that testimony, according to James' office, that it was overstated by $200 million. And, also, the values of 40 Wall Street, that's a property that Donald Trump Jr. was directly involved with, they said that the valuations there had changed from $730 million in 2015, where a bank that was loaning the money actually valued it much less, at $257 million.

That is quite a big difference. Now, there are reasons why valuations can be different from appraisals. That's the key to what the Trump Organization's defense will be here if there ever is a civil lawsuit. This is all part of that civil investigation.

Now, again, today, the Trump Organization issued a statement denying any wrongdoing, saying that the only one misleading the public is Letitia James. They said that they will vigorously defend against these allegations -- Ana.

CABRERA: Thanks for giving us all those details. Those are some serious discrepancies in the numbers.

Kara Scannell, thank you.

Let's continue the conversation and bring in a couple of experts here.

Former White House ethics czar Norm Eisen is with us. He was also a special counsel to House Democrats in Trump's first impeachment trial. And also joining us is CNN contributor and Donald Trump biographer Michael D'Antonio.

Good to see you guys.

Norm, let's start with this line in a document here that stood out to me among the filing that reads -- quote -- "While the over OAG," the office of the attorney general," has not yet reached a final decision regarding whether this evidence merits legal action, the grounds for pursuing the investigation are self-evident."

Now, do you see charges coming, Norm? What does this tell you about the potential for charges?

NORMAN EISEN, CNN LEGAL ANALYST: Ana, thanks for having me back.

We have all seen cases where the public facts seem to indicate that a case can be filed, in this case, a civil matter by the A.G., and then it doesn't turn out that way.

However, in looking at this full fact pattern, looking at the hundreds of millions of dollars in discrepancy, and knowing A.G. Tish James, I think civil charges are very, very likely here.

These are extremely troubling and well-documented allegations. And, Ana, it's not just one. It's over and over again, that pattern. So I would expect likely that charges are ahead. That's why they want to talk to Mr. Trump, to Ivanka, to Don Jr.

CABRERA: So, Michael, just to really hyperfocus, again, the broad allegation here, the attorney general's filing says investigators have identified numerous misleading statements and omissions in financial statements used to obtain loans and tax submissions.

And she's trying to determine who was responsible. So, as a Trump biographer, I'm curious, what have you observed?

MICHAEL D'ANTONIO, CNN CONTRIBUTOR: Well, I think there's no chance that Donald Trump didn't know absolutely everything that was going on.

If -- Norm is right. If you add up what these discrepancies reach as a total, it's half-a-billion dollars or more. And that's just in the examples that the attorney general noted. He also -- and I think this is worth noting -- is responsible for training his children to play the same games.

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So if he didn't know precisely what they were doing, he knew how they were operating. And the key example of this historically was the Trump SoHo case, where, early in its sales, Ivanka Trump went out and said that 60 percent of the units were already committed to buyers. And, in fact, it was only 15 to 20 percent.

She knew she was lying. She had to know she was lying. There was an investigation then. And the rules were different in terms of the informal rules of operation in New York at the time, and Trump wriggled out of that case. I don't think he can wriggle out of this one.

CABRERA: But, Norm, at what point does a lie cross the legal line?

EISEN: Well, Ana, it's a good question. It's one thing for Michael and myself to point out these very serious allegations.

But then you have got to be able to prove them in court. I think the point at which it crosses the legal line here is if you can show intent or gross negligence by the executives, and that is then imputed, that's carried over to the company.

And that's why the amount, the hundreds of millions of dollars, property after property, Seven Springs, the Trump apartment, all of the other properties that are being looked at, 40 Wall Street, that pattern, and the recurring nature of the allegations.

And let's bear in mind, they are just allegations now. That's why these depositions are needed. All of that sets up a mosaic where, by civil standards, it looks like they have a case that can cross that legal line. CABRERA: Michael, quickly, if you will, if Trump is forced to

testify, what do you think he does?

D'ANTONIO: Oh, I think kill obfuscate. He may actually claim that -- declare that he's claiming his Fifth Amendment rights.

This is a person who did it 97 times during his first divorce. So he's familiar with the Fifth Amendment, even though he denigrates others who use it. So, I would expect it to be a kind of "Alice in Wonderland" experience for the people taking the deposition, and he will give very little ground.

CABRERA: We know that Eric Trump has testified and did just that, took the Fifth.

D'ANTONIO: Correct.

CABRERA: And, as you point out, the former president has said this about people who take the Fifth: "If you are innocent, why are you taking the Fifth Amendment?" he said in 2016. "The mob takes the Fifth."

Well, we will end this conversation here, but I want you guys to stay with me, because there is more to discuss, including the new subpoenas from the January 6 Committee and what could be the first release of Trump White House documents from the National Archives.

Plus, the CDC just released a new study comparing the benefits of vaccination to prior infection. And there is one clear winner.

And a new warning from Secretary of State Antony Blinken, as he meets with leaders in Ukraine, what he said about Russia's military might and what it could mean for the U.S. effort to stop an invasion.

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CABRERA: The House committee investigating the January 6 Capitol attack issuing new subpoenas, and Rudy Giuliani is now included, along with these three other key figures who pushed lies and conspiracies amid Trump's failed bid to overturn the election.

CNN is also exclusively learning the committee for the first time took action against members of Trump's own family, obtaining phone records from his son Eric and his future daughter-in-law.

CNN senior justice correspondent Evan Perez joins us.

Evan, major developments here. What more can you tell us?

EVAN PEREZ, CNN SENIOR JUSTICE CORRESPONDENT: Yes, Ana, these are big developments.

In the case of the Trump -- the former president's lawyers, Rudy Giuliani is, of course, the big name there. And he's among the people who was working, as you said, on pushing the idea that there was fraud in all these states that would have made a difference in the election.

Of course, we know that is not true. In the case of Giuliani, he had conversations with officials in the administration at the time, trying to see if the Homeland Security Department could seize voting machines. So, they want -- the committee wants to hear from him.

They have testimony about some of his conversations, so now they want to hear from him, as well as Sidney Powell and these other figures that were part of this movement. And, of course, in the case of the former president's son Eric Trump, he spoke at the January 6 rally. In the case of his future daughter-in-law, she was a fund raiser for some of this so-called Stop the Steal movements.

So, lots that the committee believes in already has on their hands, and they want to hear more from all of this new information coming in.

CABRERA: Also, Evan, the National Archives plans to release four pages of Trump era White House documents to the House today.

What do we know about these four pages?

PEREZ: Well, we know that the Trump legal team is trying to block the release of these documents. They're waiting for the Supreme Court to decide whether they're going to hear the former president's appeal.

According to the Biden administration, they believe these four pages are not covered by a stay right now. And so one of the things that the Trump legal team said this morning was, Ana, that they believe, if these pages are released, then the Biden administration will be in contempt of court.

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We will see. There's a 6:00 deadline whether the Archives turns over those documents, those four pages. We don't know exactly what's in those pages. But there are -- these are documents that the Trump legal team says are covered by his claim of privilege -- Ana.

CABRERA: Interesting.

Evan Perez, thank you.

And Norm Eisen and Michael D'Antonio are back with us now.

Norm, I just wonder why these four documents could potentially be released, given the pending litigation over those others.

EISEN: Ana, the reason the documents could potentially be released is because the legal system is not self-executing.

Trump and his lawyers have to ask the courts to block the release. They have only covered the first three sets of documents. They didn't, it appears, cover this fourth smaller subset of documents. If the injunction doesn't apply because they didn't ask, as we have seen so often before, they were clumsy in their legal approach.

And so these documents are subject to release, unless they obtain an emergency injunction.

CABRERA: And, Michael, on the new subpoenas, this just got personal.

The committee, we have learned, got phone records from Trump's son Eric Trump, his future daughter-in-law, Kimberly Guilfoyle. They were publicly involved, as we know, in Trump's Stop the Steal efforts, but this is Trump's family now. How do you think he's taking this all in?

D'ANTONIO: Well, I'd hate to be hanging around Mar-a-Lago today. I imagine he's in a very bad mood.

This is, as you say, very personal. But we have gotten to this place because the Trumps approached government as if it was a monarchy. And so the king's family was intimately involved in everything that was going on in the government and in politics.

And all of this was mixed up in a very inappropriate and clumsy way. And now they're stuck with investigators targeting Trump family members because they were intimately involved in what could be potential crimes, and certainly in this scandalous story of the Trump campaign's effort to overturn the election.

So I'm sure there's -- the president -- the former president is stewing over this, but it's something he invited by making the White House sort of a family affair.

CABRERA: Also interesting, Norm, after 50-plus previous subpoenas, the committee finally got Rudy Giuliani involved. Why did it take so long to subpoena him? What does it tell you about the committee's strategy?

EISEN: Ana, it's interesting.

The -- like any investigation, any good investigation, the committee has done a good and a fast investigation. You work your way up the food chain. What we talked about earlier with the civil investigation by the New York A.G. is kind of a preview. They're reaching the end of the food chain.

And the same thing is happening in the congressional investigation. So, now we learned that the younger Trump's phone records and Kimberly Guilfoyle, two people very, very close to the president, that their phone records are in the hands of the committee.

And, finally, we have come to the president's lawyer, Mr. Giuliani, in the middle of the big lie, Ana, that continues to have such devastating effects around the country, with hundreds of unneeded bills to take the vote away from Americans that are promulgated by the big lie.

Thank goodness that committee is working through those issues and reaching towards the top of the food chain. And I think we know who will be next. It'll be Don Jr., Ivanka, Jared, and, ultimately, the president himself.

This is a sign we're getting to the hearings and to -- and to the ultimate report.

CABRERA: Norm Eisen and Michael D'Antonio, thank you both. Good to have you here.

D'ANTONIO: Thank you.

CABRERA: And make sure you stay right there, because, next hour, Trump's former personal attorney Michael Cohen is going to join CNN to react to all this new legal news, all these new allegations against his former boss.

Again, that's coming up in the 2:00 hour.

Meantime, maybe you're vaccinated, you haven't had COVID, or maybe you have had COVID and you're still not vaccinated.

Just how much protection do you have? The CDC just dropped a new study on all of that. We will have details next.

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