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Soon, Blinken Addresses U.N. Security Council Amid Russian Escalations; Appeals Court Allows DOJ to Resume Review of Seized Mar- a-Lago Documents; New York Attorney General Lawsuit Accuses Trump, Three Oldest Children of Massive Fraud. Aired 10-10:30a ET

Aired September 22, 2022 - 10:00   ET

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

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POPPY HARLOW, CNN ANCHOR: Good morning, everyone. It's the top of the hour. I'm Poppy Harlow.

JIM SCIUTTO, CNN ANCHOR: And I'm Jim Sciutto.

We are following several major stories this morning. Right now, a critical meeting at the U.N. General Assembly, where Secretary of State Antony Blinken will address the U.N. Security Council following Russia's recent escalations in its ongoing invasion of Ukraine.

Plus, former President Trump facing two major legal challenges in the last 24 hours. And these are not just run-on-the-mill legal challenges. First, a federal appeals court has handed the DOJ a win, a big won, in the battle over the classified documents that it took from Mar-a-Lago after they were held there for months by the former president. The court rejected Trump's claims that papers were somehow declassified.

HARLOW: Well, this comes just hours after the New York attorney general announced a $250 million civil law suit against Trump, accusing the former president, his three eldest children and the Trump Organization of defrauding lenders, insurers and other entities for years.

SCIUTTO: We do want to start at the U.N. this morning, where the General Assembly continues. CNN National Security Correspondent Kylie Atwood, she is there.

All right, so we've been in the same place at the same time over the past several months. Why do we expect it to be a different outcome or deliverable, as it were, from this assembly on Ukraine?

KYLIE ATWOOD, CNN NATIONAL SECURITY CORRESPONDENT: Yes. So, as you point out, Jim, the Russian foreign minister and the secretary of state, Tony Blinken, have been in the same place at the same time in multiple instances in recent months. In one of those instances, the secretary of state went after Russia and said very bluntly, Ukraine is not your country, and we expect that there is going to be more tense confrontation today.

And the reason that today is different is because we do expect that both the secretary of state and the Russian foreign minister, Lavrov, are going to deliver remarks as part of this U.N. Security Council meeting on Ukraine.

And when it comes to Blinken himself, we are told that he is very similar to President Biden yesterday going to directly confront what we have seen as these recent developments over the last few days with President Putin talking about the nuclear possibilities of this war, also with those referenda that are planned in the Ukrainian-occupied territories in Russia and also the mobilization of additional troops that Russia is sending into this. So, there are those recent developments but the secretary of state is expected to address.

He is also expected to touch on just the overall picture here, the overall cost that not only has been inflicted on Ukraine because of this war but also on the globe. And, of course, we'll be watching very closely to see what the Russian foreign minister says. He was in a meeting with other foreign ministers a few months ago and he walked out of that meeting when there were critical comments made about Russia. So, we'll be watching to see how he responds to the criticism at the U.N. Security Council meeting today. And there is also the Ukrainian foreign minister who will be there making remarks. So we'll be watching to see what he said as well. Guys?

HARLOW: Significant remarks ahead very soon. Kylie, thanks very much for that reporting at the United Nations.

And other major news this morning, is that the federal appeals court, the 11th Circuit, has ruled that the Justice Department can move forward with its investigation into the classified documents recovered at Mar-a-Lago last month.

SCIUTTO: It was a sweeping, really devastating decision for Trump and his lawyers.

CNN Senior Crime and Justice Reporter Katelyn Polantz joins us now. Katelyn, when you look at these statements here, they reject -- and, by the way, two Trump-appointed judges out of the three on this panel, rejected outright Trump's lawyers various claims.

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KATELYN POLANTZ, CNN SENIOR CRIME AND JUSTICE REPORTER: Yes. I mean, when you look at setback, this whole opinion, it was 29 pages long, the big finding here was that they say these documents, these 100 documents seized out of Mar-a-Lago were marked as classified, they should be treated like they're classified, they should be treated like they're sensitive. Trump had argued that he could be harmed if those documents got back into the hands of the federal government, which would own them. But he had argued this, they rejected that. They said, no. Actually, the United States could be harmed if the Justice Department doesn't get to do what they want to do.

This is how they wrote it. They said, we have no reason to expect that the United States' use of these records imposes the risk of disclosure to the United States of plaintiff, that is Donald Trump's privileged information. So, they really are saying that Donald Trump is trying to make privilege claims here, he's trying to make personal claims about these records that just isn't going to fly here.

SCIUTTO: Doesn't fly.

HARLOW: And, Katelyn, let's listen -- just let our viewers listen to some of the former president's responses about these documents. Here he was.

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DONALD TRUMP, FORMER U.S. PRESIDENT: It doesn't have to be a process, as I understand it. You know, there are different people say different things, but as I understand it, there doesn't have to be. If you're the president of the United States, you could declassify just by saying it is declassified, even by thinking about it.

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HARLOW: Did the justices -- the judges as Jim said, by the way, two of the three on this panel appointed by Trump, did they say anything about his argument for blanket declassification?

POLANTZ: They did, they actually addressed. And they pointed out that there has been nothing in the record here saying that these were, in fact, de classified by Trump. This is something that came up with the special master. They said, even the discussion of that right now, it's a total red herring. Instead, they said, again, pointing out, these are not personal documents, they're not privileged documents, they're executive branch documents if they're marked as classified.

And they wrote in a complete rubbing (ph) of the legal arguments from Donald Trump, the plaintiff suggests that he may have declassified these documents when he was president but the record contains no evidence that any of these records were declassified. And before the special master, Plaintiff Donald Trump resisted providing any evidence that he had declassified any of these documents.

Now, of course, this opinion came, and then a short time later, Trump continues with this approach on Fox News last night.

SCIUTTO: Well, one thing Trump and his lawyers have never presented is an argument for why declassify highly sensitive documents, haven't even attempted to make a case to do so. Katelyn Polantz, thanks so much.

Well, the other daunting, legal battle ahead of the former president, for his businesses, the New York attorney general's sweeping 220-page civil fraud lawsuit against Trump, three of his adult children and the Trump Organization.

HARLOW: That is right. Letitia James accusing the Trumps of deceiving lenders in a, quote, staggering fraud, that is the word she used, a scheme, she argues, that lasted over a decade. Our Politics Reporter Chris Cillizza is at the magic wall to walk you through some of these just stunning numbers.

CHRIS CILLIZZA, CNN POLITICS REPORTER AND EDITOR AT LARGE: They are. I want to start, Poppy, big picture. Why did Donald Trump do this? Well, it was to secure more favorable loans often to buy other things.

So, let's go through what he did. Okay. Trump Park Avenue, one of his properties, this is a lot of residential apartments and stuff. The appraised value in 2010, $750,000, these are rent-controlled, so that's why it's so low, I'd say. Claimed value, $50 million. Now, I didn't get a math degree in college, but I'm saying that is about $49 million difference.

Okay, let's go. Same building in 2020, appraised value, $84.5 million, Trump claimed $1358 million, again, 50-ish million dollars difference. It's a big difference.

Okay. 40 Wall Street, another Trump property, appraised value, again, an independent appraiser said this property was worth between $200 and $220 million. What did Donald Trump say it was worth, between $524 and $530 million.

I'm just going to keep putting these numbers up here, not just because I learned how to subtract when I was in elementary school but because they're so startling. $300 million delta between what Trump claimed and what it was actually appraised to be worth.

Now, this one I found totally fascinating. So, Donald Trump used to live in Trump Tower, as you well know. Remember, he came down the golden escalator when he announced his candidacy back in 2015. The actually square footage of where he lived, that tripliex apartment in Trump Tower, is 11,000 square feet. That is still huge, right, but it was 11,000 square feet. He claimed that the square footage was 30,000 square feet and he claimed that the value of just that apartment, just that one apartment, was $327 million.

Letitia James, the New York state attorney general, said that no apartment has ever been sold in New York City, which Poppy, as you know, they're very expensive apartments in New York City, but no apartment has ever sold for $327 million, ever.

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Why does all of this matter other than to say Donald Trump is really pretty far off when he estimates what his things are worth? Because he uses those estimates to buy other things. He used that to buy Trump National Doral. He used it -- the Trump International Hotel and Tower in Chicago.

And then there is this. This is the one that I've live closest to the, the Trump old Post Office. So, he bought the old Post Office and made a Trump Hotel out of it. He eventually wound up selling this property at a profit of $100 million. It is now a Waldorf Astoria. So, he overvalues things, he uses the overvaluing of those things allegedly to obtain loans to buy other things that he makes massive profits on. That is the core of the case that Letitia James laid out. That is why you get to the $250 million that she's looking for recompense. Back to you guys.

HARLOW: Thank you for watching us through all of that. You clearly learned your math very well in elementary school.

CILLIZZA: Thank you, sixth grade, thank you, early school math teachers in Connecticut.

HARLOW: For sure. But in all seriousness, wow, there is a lot here. There is a Trump defense as well. Let's talk about all of it with -- well let's first listen to how he responded in that defense. Here it is.

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TRUMP: I actually thought that they would never bring a case, and she brought it. And the reason I thought because she didn't have a case. I was of the impression she wanted to settle, but I had a problem because how do you pay something even if it is a small amount of money if you're not guilty.

These are banks that have the best lawyers in the world, Sean. This is the only -- and, by the way, that got paid back, just so you know.

UNIDENTIFIED MALE: Everybody is paid back. Nobody got harmed.

TRUMP: I never got a default. No, I paid them back because we have a lot of cash.

(END VIDEO CLIP)

SCIUTTO: Joining us now, someone who is very familiar with the process of suing Donald Trump, how he runs his business. Adam Leitman Bailey is a New York real estate attorney who has sued the former president seven times, including a case where he won a settlement for 30 people who said they were misled when they bought apartments in Trump's Soho building.

So, I think what is key here for folks to understand is what is the pattern, right? The cases you dealt with and the cases where we're seeing here, I mean, for instance, the figure that jumped out to me overvaluing his Mar-a-Lago estate by ten times, which he then used to gain loans from public companies that are owned by shareholders, right? I mean, he deceived them to do so. What is the pattern of how he runs his business in this way and what is wrong with that, legally, financially?

ADAM LEITMAN BAILEY, COMMERCIAL AND RESIDENTIAL REAL ESTATE ATTORNEY IN NEW YORK: So, first of all, there is no -- the similarity between the case that I won getting everything my clients wanted and this case is that Trump lies. Everyone in the universe now knows. They didn't know in 2011 when they started the Trump Soho case but they know now that Trump doesn't tell the truth.

But is it fraud, and this 225-page complaint, where there is hundreds of allegations of fraud, is it fraud under New York law? And that is where there may be some problems in the lawsuit. I'll give you the first problem. To commit fraud in New York, you have to bring it within six years. And if you go back six years, the day he became president, he wasn't in charge of his own affairs. So, Letitia James has a real big problem proving fraud against the former president, number one.

Number two, the banks -- I represent banks. Banks do not care what Donald Trump thinks his properties are worth. What happens is the banks hire their own appraisers, their own professionals and they ask for documents from Donald Trump. And the main thing they ask for, the number one document they want are tax returns. And they're looking at those tax returns from the accountants and they are saying, what kind of money are the buildings making. And what -- when you read the complaint, you're going to see, Mazars, the accountant, saying, we no longer agree with what we wrote, okay. So, they should go after the accountants.

And then the second thing they look at is the appraisers. Now, Donald Trump doesn't pick his own appraisers in these cases. Who picks them? The banks, Cushman & Wakefield in this case, a very (INAUDIBLE) appraiser. And the bank relies on their appraiser. So, what probably happened was the banks picked their appraiser, Donald Trump doesn't agree with the evaluation, and he picks his own and then they go back and forth.

Now is there fraud -- yes go ahead.

HARLOW: Can I jump in on that point, on appraisal, so that I want people to listen to what the former president said last night about it? Here he was.

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TRUMP: You can't just say, here is a financial statement. But what we do is, here is a financial statement, but be careful because it may not be accurate, it may be way off.

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I mean, we go -- I think it is close to a page-and-a-half of all of these things, get your own people. Use your own appraisers. Use your own lawyers. Don't rely on us.

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HARLOW: Does that shield him?

BAILEY: So, he used -- he uses -- right. So, what he's doing is the banks use their own people and they say to Trump, you want to take more money, you want us to lend you more money, use your own people, and he did that. But he didn't do it himself. He didn't hire -- he didn't say, I'm Donald Trump, I'm going to go appraise it myself. He hired experts. And those experts he's relying on. Are they going to risk their license and come out and say, I lied, I committed fraud and I made up numbers? SCIUTTO: Yes. Adam, I have to ask you, though --

BAILEY: That is how hard this lawsuit is for the attorney general.

SCIUTTO: Does that mean we all could lie, just anytime you apply for a loan, just make up, my house is worth a billion dollars, and, therefore, please lend me more money? I mean, is it -- I asked Paul Callan this question, he's a lawyer, last hour, and he said that there is something wrong with submitting deceptive documents. Are you saying there isn't, or there isn't for someone who has a good enough lawyer?

BAILEY: No, it is not that easy. Donald Trump has to find someone to lie for him, a reputable appraisal company and a reputable accountant to do that. I'm not able to do that. You're not able to do that. I can't find an accountant to lie for me. I can't find an appraiser to lie for me. I'm not able to do that. Maybe Donald Trump is so persuasive.

Now, there is one caveat to this. When The Apprentice was going on, Donald Trump was one of the most famous men in America. And what he had was a brand perception as referred to in his lawsuit. And how much is a brand perception worth? And Donald Trump's view was because of my brand perception, because I'm so famous, my properties are worth more. So, that is going to a hard case to prove fraud when he says, it is an opinion, I have an opinion that my properties are worth more because I'm so famous, and that makes this a very difficult case for the attorney general to win, not that she won't win, it just makes this a difficult case.

HARLOW: Understood. Adam Leitman Bailey, thanks for helping us understand and get wrap our heads around all this.

BAILEY: Thank you for having me.

HARLOW: Well, still to come, Hurricane Fiona churning forward as a category 4 storm, so the latest forecast and the next storm creating worries in the gulf.

SCIUTTO: Plus, Russia and the wake of Vladimir Putin's latest escalation in the Ukraine invasion, big protests there, a new CNN reporting on in fighting as well among Russian generals. More than 1,300 people have been detained for Putin's mobilization of hundreds of thousands of reservists. We're going to be joined by a cofounding member of the Russian feminist protest art collective, Pussy Riot, who has made their own courageous stand. Stay with us. You're going to want to hear this interview.

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SCIUTTO: Hurricane Fiona, and it is a big one, is still moving and it's not done yet. The category 4 storm expected to impact Bermuda and Coastal Canada actually over the next 24 hours.

HARLOW: In the meantime, President Biden has already approved a major disaster declaration request for Puerto Rico, injecting much needed cash into the areas hit hardest by Hurricane Fiona.

Our Leyla Santiago joins us again this morning from Puerto Rico. Leyla, good morning. We're still getting really more of a complete picture, right, of how just bad the damage is there.

LEYLA SANTIAGO, CNN CORRESPONDENT: Correct. The assessment continues, and I just spoke to FEMA this morning in terms of where they are, and that major disaster declaration is for parts of island. They say more could be added. We'll have to wait and see as they assess the situation.

But let's talk about power and water because that is the big story right now. Two-thirds of the island now have water restored. But, again, that means a third of the island still waiting to get water, and then there is the power. That still has a long way to go. But there was quite a bit of progress overnight. Nearly 40 percent of the island now has power restored. When you look at those who don't have it, that means about 60 percent still waiting to get power, five days after Hurricane Fiona just drenched this island.

Where we are standing right now Toa Baja, this was completely inundated, completely flooded. And so we have been here for two days now watching as these neighbors have had to clean out their homes. They feel lucky because they have power and water, that water being used to clean out these homes. But I asked one neighbor, what was it like when she got back after arriving from the shelter and this is how she explained it.

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PATRIA DIAZ, PUERTO RICO RESIDENT: I screamed. I started crying, because I don't what go by this again.

I don't like to be through this again. I can't buy another house now. I'm not 30 years old.

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SANTIAGO: And one of the things when you talk to emergency responders, quite frankly, when you even talk to the neighbors around here, lessons were learned after Hurricane Maria. That has been very clear from a response issue, even from a preparedness perspective here. But how those lessons are applied moving forward, and in terms of restoring the power, the water that people need to go about their daily lives, well, that, we'll have to see how that plays out. Poppy?

[10:25:00]

SCIUTTO: Stories of suffering so familiar there. Leyla Santiago, thanks so much.

Well, she knows firsthand the wrath, the power, the violence of the Russian government for speaking out against the Kremlin and its oppression. Up next, activist and artist Nadya Tolokonnikova joins me to talk about recent protests there as Russian civilians courageously stand up to the Kremlin and its war, some being forced to fight in it. (COMMERCIAL BREAK)

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