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FTX Founder Arrested In The Bahamas, Faces Charges In U.S.; U.S. Military Official: Russia Using 40-Year-Old Ammunition; Ukraine Won't Claim Of Deny Drone Strikes Near Moscow; Russia Reportedly Wants Assassin Held In Germany For Whelan Trade; U.S. Expected To Announce Nuclear Fusion Breakthrough; Israel: Shooting Of Palestinian Girls Was "Unintentional"; Second Protest-Related Execution Carried Out In Iran. Aired 2-3a ET

Aired December 13, 2022 - 02:00   ET

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

(COMMERCIAL BREAK)

[02:00:37]

ROSEMARY CHURCH, CNN ANCHOR: Hello and welcome to our viewers joining us from all around the world, I'm Rosemary Church. Just ahead here on CNN Newsroom, crash and burn. The founder of the failed cryptocurrency exchange FTX is arrested in the Bahamas. Details on the criminal charges he may be facing.

Political upheaval rocks Peru. Protests now turning deadly as the country's jailed former president insists, he's still in charge. And the U.S. is set to announce a major scientific breakthrough why nuclear fusion could be the key to unlocking a clean energy source for the planet. We'll take a look.

UNIDENTIFIED MALE: Live from CNN Center, this is CNN Newsroom with Rosemary Church.

CHURCH: Good to have you with us. Sam Bankman-Fried, the founder and former CEO of the cryptocurrency exchange FTX, has been arrested in the Bahamas. This at the request of U.S. law enforcement. Federal prosecutors are expected to unseal an indictment in the coming hours. And the Securities and Exchange Commission announced it will file its own separate charges.

FTX filed for bankruptcy last month. The Bahamas had become its base of operations and Bankman-Fried was living there. He denies he defrauded investors, but it doesn't look like the U.S. government believes him.

Well, for more, I'm joined now by Ivan Watson, who's tracking this story from Hong Kong, where FTX was based for a time. Good to see you, Ivan. So now that Sam Bankman-Fried has been arrested in the Bahamas, what criminal charges might he face? What's ahead for him?

IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: Right. Well, the authorities in the Bahamas, they say that they are conducting their own investigation in parallel and in cooperation with what the U.S. Department of Justice is investigating right now. Authorities in Bahamas saying, you know, they're looking at possibility of financial fraud, basically.

And they say that they arrested Bankman-Fried, expecting an extradition request that they say they will comply with promptly from the U.S. government. So we've gotten a word now from the Department of Justice that they do, in fact, expect to unseal an indictment sometime Tuesday morning, presumably with charges. And then we've heard from the U.S. Securities and Exchange Commission saying that they are welcoming this development, the arrest, and they are also pursuing their own charges against Sam Bankman-Fried, who two months ago was a multibillionaire who was calling for kind of transparency and self- regulation within the crypto industry.

How far that individual has fallen now. The -- Bankman-Fried was also expected to testify virtually before Congress on Tuesday. And the head of the Congressional House Financial Services Committee has put out a statement saying that she was both surprised and somewhat disappointed by the news that her testimony, her eyewitness, was not going to be appearing.

She says that millions of creditors and people who've invested, who've lost their money potentially in FTX, they deserve to hear from Bankman-Fried. Now, there is a new CEO who was brought into take over FTX and try to rescue its assets. It's John Ray III, who kind of specializes in dealing with corporations that go bankrupt in cases of criminal malfeasance.

He will go ahead and testify on Tuesday in front of Congress. And according to his written testimony, he's just absolutely scathing about what he says he has found at FTX. Take a look at this quote. And mind you, that he worked on the Enron case, the Enron collapse. He goes, quote, "Never in my career have I ever seen such an utter failure of corporate controls at every level of an organization, from the lack of financial statements to a complete failure of any internal controls or governance whatsoever."

And he blames this on absolute concentration of control in the hands of a very small group of grossly, inexperienced and unsophisticated individuals.

[02:05:08]

Now, Bankman-Fried has been very public since he was forced out of his CEO position at FTX. He's been speaking in interviews. He appeared at the beginning of this month at a conference, also virtually hosted by the New York Times. He was asked if he thinks that he committed any crimes. He said he doesn't think so. He said he was embarrassed by how his company was managed.

Here's a little more of what he had to say.

(BEGIN VIDEO CLIP)

SAM BANKMAN-FRIED, FTX FOUNDER: That's not what I'm focusing on. It's -- there's going to be a time and a place for me to sort of think about myself and my own future, but I don't think this is it. I mean, look, I've had a bad month. This is not the main time for me, but that's not what matters here. Like what matters here is the millions of customers. What matters here is all the stakeholders in FTX.

(END VIDEO CLIP)

WATSON: Here in Hong Kong, the very young staff of this company had a reputation for working hard and also partying very hard. I think there's a lot more we're going to learn about FTX in the months ahead, Rosemary.

CHURCH: Yes, no doubt about it. Ivan Watson, many thanks, joining us live from Hong Kong.

Joining me now from Hong Kong, Primrose Riordan is the South China Correspondent for the Financial Times. Thanks so much for joining us.

PRIMROSE RIORDAN: SOUTH CHINA CORRESPONDENT, FINANCIAL TIMES: Thank you.

CHURCH: So what impact is the arrest of Bankman-Fried likely to have on the whole crypto industry? Can it survive this, given the FTX founder was very well connected and held in such high esteem, but now his company's bankrupt, he's in custody with an unknown future ahead of him?

RIORDAN: Yes, it's a very good point, Rosemary. I mean, I think that his arrest initially has been very much celebrated by parts of the crypto community, some of whom worked with Bankman-Fried and some who feel, you know, betrayed by the whole thing. But definitely it's had a massive reputational impact on the industry, particularly for a lot of institutional investors, who, you know, the sort of pension fund level groups and other around, you know, state funds which invested heavily in crypto and they're now rethinking that.

And also some who I guess partnered with FTX as well, or who worked with FTX and are wondering, you know, how they missed the red flags that were in some ways visible. So it's a really interesting impact there. I think as well, you know, a lot of the crypto community are thinking about what's next.

I think a lot of people don't think that crypto is necessarily dead or going anywhere but inside the community. I guess there's a consideration of, for example, whether or not decentralized finance or whether or not a move away from these centralized exchanges is where those going next.

CHURCH: It has to be asked how was it even possible for corporate controls to fail so miserably, allowing this crypto company to slip through the cracks and lose billions of dollars with no apparent internal controls or outside regulation. Of course, John Ray III, who's standing in now as the FTX CEO and will have to testify, he raises the same concerns. I mean, it does. It's mind blowing, really, isn't it?

RIORDAN: It really is mind blowing. I think there's a lot of questions to be asked about the due diligence that a lot of the firms, which are quite serious and quite big firms that a lot of people would have their money in. Did, you know, will have this trust in FTX. I think some of the questions are around also about whether or not there was a real personality cult around FTX and around Sam, which is what some of our reporting found when we talked about -- when we did our reporting about FTX's growth in Hong Kong.

Because we were sort of born of the city in some ways, because Sam used to be based herein Hong Kong, and he, you know, was able to really convince a lot of serious investors here to believe in him. So, yes, it definitely brings up a lot of questions going forward, especially since, as your reporter mentioned before, how there was this intermingling between these two entities that should not have really happened.

CHURCH: Right.

RIORDAN: So it's a really interesting question (INAUDIBLE) proper governance.

CHURCH: So what regulation does exist right now for crypto companies and how does it need to be improved to restore some level of trust if the crypto industry wants to continue it but wants to survive this?

[02:10:05]

RIORDAN: Yes, I guess it's a quite young industry. And when you talk to regulators about this, a lot of them will say, well, a lot of these products are just moving so quickly that it's quite hard to keep up. Hong Kong, for example, is trying to become the next crypto hub for Asia. And it decided this just before the implosion of FTX. And now it's deciding on how it will regulate crypto going forward.

But it does create this really difficult question when a lot of the reason for crypto was to avoid these government controls in the first place, and when there is all these new different products. How to make them into securities or how to make them into something which customers do have that protection is going to be a really big question. And I think that also, it creates a lot of, you know, especially when people are trying to make it more decentralized. So, yes, it's a very tricky one for regulators.

CHURCH: Yes, certainly is. So we'll see what happens. Watching it very closely, of course, as you know. Primrose Riordan, thank you so much for joining us.

RIORDAN: Thank you.

CHURCH: There are new indications, Russia is struggling with its war on Ukraine. A senior U.S. military official says Russian supplies of new ammunition are, quote, rapidly dwindling, and their forces have resorted to using 40-year-old artillery. The official says that's why Russia is reaching out to Iran and North Korea to try to get more weapons.

And the Russian President may be trying to avoid questions about the long grinding war. The Kremlin says Vladimir Putin won't be holding his usual year-end news conference. In previous years, he's also addressed lawmakers and held a marathon question and answer session with residents. But the Kremlin did not reveal any dates for those events.

Well, in Ukraine, the exiled mayor of Melitopol says Russian forces are panicking and redeploying after Ukrainian strikes on the city over the weekend. There are conflicting estimates on casualties. Melitopol has been occupied by Russia since early in the invasion and remains a major logistics hub for the Russian military.

The Ukrainian President, meantime, is asking the G7 to keep up their level of solidarity, and they've pledged their unwavering support. Volodymyr Zelenskyy asked for more weapons, financing and energy assistance on Monday. He also warned that Russia is still targeting his country's power supply and causing blackouts. Ukraine's state-run energy provider is reporting a significant electricity shortage.

(BEGIN VIDEO CLIP)

VOLODYMYR ZELENSKYY, UKRAINIAN PRESIDENT (through translation): We have to be aware that Russia has not abandoned this tactic of terror. Any absence of mass missile strikes simply means that the enemy is readying new attacks, and there could be strikes at any time. Although it is evident that even without light, we know well where to shoot and what to liberate. Russia is still counting on blackouts. This is the terrorist's last hope.

(END VIDEO CLIP)

CHURCH: With every new Russian strike, engineers have been racing to repair Ukraine's electrical grid while many brace for a brutal winter without enough heat. CNN's Will Ripley spoke with Ukraine's Defense Minister and has this report from Odesa.

(BEGIN VIDEOTAPE)

WILL RIPLEY, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice-over): Just days before the official start of winter, Ukraine's military prepares for the deep freeze. Plunging temperatures won't stop frontline fighting, says Defense Minister Oleksiy Reznikov.

OLEKSIY REZNIKOV, UKRAINIAN DEFENSE MINISTER: And it's important not only for Ukraine, it's important for Europe, it's important for civilized world.

RIPLEY (voice-over): Ukraine's goal, reclaim all Russian held territory, including Crimea, illegally annexed by Russia nearly nine years ago in 2014. The Defense Minister tells CNN, Ukraine urgently needs more weapons from the U.S. and NATO.

(on-camera): Are you getting the weapons that you need right now, in time?

REZNIKOV: You know that when you have a war, you will not have enough. We need certainly more especially air defense systems is priority number one for us.

RIPLEY (on-camera): Have you been given an explanation why the Patriot missile defense systems have not arrived yet?

REZNIKOV: It's a long discussion with our partners, because it's very sophisticated and expensive systems. So I think that Patriot also will be in our battlefield but the next stage.

RIPLEY (voice-over): That next stage includes protecting the power grid from Russia's ongoing assault on Ukraine's energy infrastructure. Russia fired hundreds of missiles just in the last two months. Regular Russian airstrikes with explosive drones made in Iran. Drone attacks plunged 1.5 million people into darkness over the weekend.

[02:15:10]

(on-camera): What's your best strategy to defend against these Kamikaze drone attacks from Russia.

REZNIKOV: Every day, we're trying to find the best solutions.

RIPLEY (on-camera): Are drones a priority for you for developing drones?

REZNIKOV: Sure.

RIPLEY (voice-over): And do you think it could be a useful tool?

REZNIKOV: Certainly. We need drones for reconnaissance, we need drones for striking, we need anti-drone systems. So electronic warfare, it's very important issue for us.

RIPLEY (voice-over): The Defense Minister won't confirm or deny Ukraine carried out drone strikes close to the Russian capital last week.

(on-camera): These attacks inside Russia, including 500 miles from Moscow, Ukrainian drones is what Russia is claiming. Is that what happened?

REZNIKOV: It's very important. Don't smoke in the danger of places.

RIPLEY (voice-over): In other words, be careful what you start. Ukrainian officials gave the same coded answer after the bombing of the Crimean bridge in October. Ukraine never officially claimed responsibility.

REZNIKOV: They targeting our infrastructure because they cannot to have a success against Armed Forces of Ukraine.

RIPLEY (voice-over): He says, Russia started this war, and Ukraine won't stop until they finish it. Will Ripley, CNN, Odesa, Ukraine.

(END VIDEOTAPE)

CHURCH: Basketball star Brittney Griner is experiencing a taste of normalcy after spending 10 months in detention in Russia. Her agent says she played basketball over the weekend and is, quote, upbeat, thankful and hopeful. But it's unclear whether she will return to the WNBA in the spring.

Well, now that Brittney Griner is free, there's a greater push to secure the release of other Americans detained in Russia, particularly Paul Whelan, a U.S. Marine veteran currently serving a 16-year sentence on espionage charges. In exchange for his freedom, Russia allegedly wants Vadim Krasikov, a convicted assassin serving a life sentence in Germany.

CNN's Fred Pleitgen takes a look at how likely that scenario is.

(BEGIN VIDEOTAPE)

FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice- over): A brutal assassination in the heart of Berlin. The killer, Russian national Vadim Krasikov, who, a German court ruled gunned his victim down on orders from Moscow.

LISA JANI, COURT SPOKESPERSON (through translation): The court called this state terrorism because the judges concluded that Russian government agencies were responsible for this murder.

PLEITGEN (voice-over): The victim, a Georgian national who fought against the Russian army in the Chechen war in the 1990s. The court found Krasikov first, shot him from behind, then fired several more rounds at close range. German authorities say Krasikov had a real Russian passport, but with a fake identity and was sent to Berlin from Russia specifically for the assassination plot.

Last year, the court sentenced him to life in prison without the chance for parole and wrote, quote, "The judges root their conviction that this was a state ordered killing in the fact that a fake persona was created for Vadim K. shortly before the crime, but also because there was a motive and the statements and behavior of Russian government agencies after the crime."

Moscow called the verdict absurd and politically motivated. But an angry German foreign minister quickly moved to expel two Russian diplomats.

ANNALENA BAERBOCK, GERMAN FOREIGN MINISTER (through translation): This government ordered murder, as the court has ruled, is a severe breach of German law and the sovereignty of the Federal Republic of Germany.

PLEITGEN (voice-over): With Paul Whelan languishing in a Russian penal colony serving a 16-year sentence for what the U.S. says are trumped up espionage charges and the Russians allegedly demanding Krasikov in exchange for the former Marine, a German government source confirmed to CNN in August that the U.S. did inquire about Krasikov, but that it was never viewed as a serious request and never discussed at the highest levels of German government.

A muted response when I asked the government spokesman. STEFFEN HEBESTREIT, GERMAN GOVERNMENT SPOKESPERSON (through translation): That does not mean that we are confirming or denying, but just that we generally do not talk about such matters in public.

(END VIDEOTAPE)

PLEITGEN: And we also managed to ask the Russians about all of these. Earlier, I got in touch with a spokesman for the Kremlin, Dmitry Peskov, and I asked him whether or not the Russians are still interested in getting Vadim Krasikov back. He said that he would absolutely not comment on the matter. Dmitry Peskov telling me that he believes all sides need to maintain complete silence about any such negotiations if they are to be successful.

Fred Pleitgen, CNN, Berlin.

CHURCH: Now to a major breakthrough that could eventually help end the world's dependence on fossil fuels. The U.S. Energy Department is set to announce scientists in California have successfully produced a nuclear fusion reaction which produced more energy than it consumed.

[02:20:01]

It's the same process that powers the sun. It's different from fusion, which is how existing nuclear reactors work. And fusing atoms doesn't produce volatile radioactive waste. Now, here's the catch. The energy produced by fusion lasts only a few seconds, and the process is expensive. So, scientists need to do a lot more research to figure out how to harness it and bring down the cost for this to become commercially viable.

And still to come, a high stakes contest at the FIFA World Cup as Lionel Messi and Croatia battle it out in the coming hours. We will have a preview. That's next.

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CHURCH: We are just hours away from the start of the World Cup semifinals. The first match on Tuesday is a clash between Argentina and Croatia, the two most recent runners up. The Croats are trying to advance to the final for the second straight time, where they will play for their first title ever, while Argentina is searching for a third trophy and the first with superstar Lionel Messi at the helm. The winner of Tuesday's match will face either France or Morocco, who will play in the second semifinal on Wednesday.

And we'll have more World Cup coverage for you later this hour on CNN World Sport.

Well, meantime, the body of American sports journalist Grant Wahl, who died while reporting from the World Cup is back in the United States. His manager says an autopsy is now being completed. Wahl passed away last week after collapsing during Friday's Argentina-Netherlands match. He was just 49 years old.

U.S. State Department officials said Monday they have not seen any indication of foul play in connection to his death.

(BEGIN VIDEO CLIP)

(GUN SHOTS)

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CHURCH: You are looking at mourners carrying the body of a Palestinian teen who was killed during a raid by the Israeli military in the occupied West Bank city of Jenin. The Israelis say her death was unintentional and Prime Minister Yair Lapid offered his condolences. But the girl's family believes her death was no accident.

CNN's Hadas Gold has more now from Jerusalem.

HADAS GOLD, CNN JERUSALEM CORRESPONDENT: Israeli forces acknowledging on Monday that it was likely their forces, who they say unintentionally, killed a 16-year-old Palestinian girl during an Israeli military raid in Jenin, in the occupied West Bank. Now, what happened is on Sunday evening, the Israeli military carried out an arrest raid in Jenin. This has become a common occurrence this past year, especially as the Israeli military says it's targeting military since strongholds in the West Bank.

[02:25:04]

Now, the 16-year-old, her name was Jana Zakarneh, her family says that after the raid began and they began hearing heavy gunfire, Jana decided to go up to the roof to see what was happening. They say that then, 20 minutes after the Israeli soldiers left the area, they found her on the roof and they say that she was shot four times.

Now, the Israeli military says that after review, they believe that it was one of their security forces who they say unintentionally shot and killed Jana. They say that during the military raid, their forces came under fire. They say also from rooftops, and that their soldiers said that they were shooting back at what they thought were armed gunmen from roofs around where Jana was standing.

The Israeli Defense Minister, Benny Gantz commenting on the incident. Take a listen.

(BEGIN VIDEO CLIP)

BENNY GANTZ, ISRAELI DEFENSE MINISTER (through translation): First, I express my sorrow for her death. As for any death of someone who was not involved in terrorism, if that was indeed the case. This activity was about arrest of suspects in shooting attacks and an involvement in terrorist organizations with the aim of murdering Israelis.

During the incident, massive fire was fired at the forces and explosives and Molotov cocktails were thrown. In response, the forces returned fire at the sources of the shooting out of self-defense.

(END VIDEO CLIP) GOLD: Now, Jana's family is rejecting the assertion that it was unintentional. And the Palestinian Authority Prime Minister Mohammad Shtayyeh has called on the United Nations to investigate the incident and to put Israel, he said, on the blacklist. This has been an exceptionally deadly year for Palestinians, especially and also Israelis so far this year, setting record numbers for the number of deaths across Israel and the occupied territories.

Now, the Israeli military says most of the 166 Palestinians killed in the West Bank were either militants or engaging violently with their soldiers. But human rights organizations and the United Nations say that bystanders have been caught up as well as we are seeing with Jana, with the 16-year-old's death.

Israeli authorities say at least 31 people have been killed in attacks targeting Israelis across the West Bank and Israel. These are numbers that in some cases and types of attacks and violent clashes that have not been seen, some people say, since the early 2000s. And there is a lot of worry amongst the international community, especially as a new Israeli government is expected to take power any day now.

It will be, in some estimates, the most right-wing government in Israeli history. And the international community is especially concerned about certain ministers who will be appointed. Some of them, who just a few years ago would have been considered the far-right wing fringe of Israeli politics, now will be in positions of power, including in some cases, controlling Israeli police. So there's a lot of concern that the situation that has always already been so violent and so tenuous will potentially only get worse.

Hadas Gold, CNN, Jerusalem.

CHURCH: We are learning new details on the execution of a second protester in Iran. An Iranian news agency released this video, which was shown during his trial. Iranian forces claim it shows the protester allegedly stabbing two security officers. Legal experts in Iran have challenged the video, saying it's not enough to identify the people involved.

CNN has blurred the video for reasons of sensitivity, but has seen the original version and it does not clearly show the identity of the victim. The protester was hanged publicly on Monday and the U.S. State Department has condemned his execution.

(BEGIN VIDEO CLIP)

NED PRICE, U.S. STATE DEPT. SPOKESPERSON: These harsh sentences, and now the first public execution at least are meant to intimidate Iran's people. They are meant to suppress dissent and they simply just underscore how much Iran's leadership actually fears its own people.

(END VIDEO CLIP)

CHURCH: Meantime, several prominent Iranians have sent a letter to the U.N. urging the international community to call on the Iranian regime to cease issuing these death sentences. Still to come, people are taking to the streets of Peru upset of the removal of the ousted president. Why Pedro Castillo is in jail, saying he still holds the office. We'll have that after the break.

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[02:30:00]

CHURCH: An accused bomb maker in the Lockerbie terror attack has made his first appearance in U.S. court. The U.S. believes Libyan Abu Agila Mohammad Masud Kheir al-Marim played a role in the deadliest terror attack ever and the United Kingdom. He faces several criminal charges related to the bombing. 270 people were killed when Pan Am flight 103 came down over Scotland. Many of the victims were Americans. Masud's case is a major milestone for families of the victims and investigators in the decades old case.

(BEGIN VIDEO CLIP)

STEPHANIE BERNSTEIN, HUSBAND KILLED IN 1988 LOCKERBIE ATTACK: It is fitting that we are coming off on the 34th anniversary of the bombing and that we, at last, had the man responsible for making the bomb. I think the important thing is that he is here to face the charges of a murder of 270 people of 190 American citizens (INAUDIBLE).

He is the first person responsible for the death of my husband to actually be tried on U.S. soil.

(END VIDEO CLIP)

CHURCH: The suspect who is in U.S. custody did not aim to a plea on Monday, saying he needed to retain a lawyer before moving forward. He is set for another court appearance on December 27th.

Those supporters of Brazilian president Jair Bolsonaro, they had gathered outside the federal police headquarters in the capital Monday after police carried out and arrest warrant for an outspoken Bolsonaro supporter. The police say clashes broke out when some demonstrators tried to rush the headquarters. Several buses were also set on fire.

All this comes as electoral authorities certified the results of October's elections on Monday, naming Luiz Inacio Lula da Silva as the country's next president. Bolsonaro, though, has yet to formally concede defeat, and his supporters have been staging protests over the election results.

While, supporters of ousted Peruvian president, Pedro Castillo, took to the streets of Lima and clashed with police.

While similar scenes played out in Peru's second largest city where the international airport was temporarily closed just days after Castillo was removed from office and jailed. For his part, Castillo claims he still holds the job. In a series of tweets posted on his behalf, Castillo claimed he was still the president of Peru. In a hand written letter, Castillo said he had been kidnapped, humiliated, and mistreated, and called new president, Dina Boluarte, a usurper. Well, meanwhile, President Boluarte announced she was reaching an agreement with Congress to hold new elections in April of 2024.

Well, joining me now from London, Christopher Sabatini, is a senior research fellow for Latin America at Chatham House. He joins me now. Thank you so much.

CHRISTOPHER SABATINI, SENIOR RESEARCH FELLOW FOR LATIN AMERICA, CHATHAM HOUSE: Thanks, Rosemary.

[02:35:00]

CHURCH: So, as we just reported, Pedro Castillo claims he's still Peru's president and is calling for his release, claiming he was kidnapped and mistreated in a series of tweets that he did authorize to be posted on his behalf on Twitter. So, all this destabilizing of the country, of course, what's going on in Peru right now?

SABATINI: Well, long-standing wise this has been just a terrible couple of years for Peru. They've had seven presidents since 2016. The party is fragmented. The Congress and the president for years now have been at loggerheads. And basically, he, after three separate impeachment attempts, attempted to dissolve the Congress and oppose a state of siege. And the Congress fired back and said, no, you are removed as president. And he tried to flee, and was arrested.

So, it's a long-standing dispute. And of course, what we're seeing with the popular protests is a reaction against a president who is popular in large parts of the -- rural parts of the country.

CHURCH: Indeed. And we'll get to those protests in just a moment. But I did want to ask you, because Castillo called, as we just reported, the new president, Dina Boluarte, a usurper after she became Peru's first female president last week following Castillo's impeachment and subsequent arrest. What more do you know about Dina Boluarte, and of course, the circumstances surrounding Castillo's impeachment and a risk?

SABATINI: Well, first of all, she is really a political unknown quantity. She served a few positions in the government. Of course, this is a government that because of inexperienced and divisions had 80 ministers and it's short one-and-a-half-year term already. She's really had never served in elected office before, but she was his vice president, and she was assuming the role constitutionally after the Congress basically removed the president for his attempted coup.

CHURCH: Of course, meantime, the U.N. Human Rights office is concerned that these protests we're seeing in Peru may escalate further. We already know that they'd turn deadly. And in addition to that, strikes are planned this week. So, how bad will this likely get, do you think? And do you worry that this could get out of hand?

SABATINI: I do worry that it will get out of hand. This is -- again, Peru has been a very fragile political situation for a long time. It's amazing, in fact, that it's remained relatively stable in economic growth as it remains, in fact, one of the highest in the region for a long time, although it's now down expected to be about 2 percent.

What I expect will probably happen with a lot of these protests is common in rural areas as they'll start to seal off highways, stage sieges in cities and really, crippled parts of the economy, and a large part of Peru's economy depends on the mining industry, which is in many of these rural areas, and has to, obviously, ship its products to the port on the coast.

So, I think this would be economically very crippling. I don't think it's going to go away anytime soon. And I don't think Boluarte's proposal to move the elections up to 2024 is going to be sufficient.

CHURCH: All right, Christopher Sabatini, thank you so much for your analysis. We appreciate it.

SABATINI: Thank you very much.

CHURCH: Hong Kong is said to ease some COVID restrictions for travelers coming into the city starting Wednesday, they will no longer have to go through a three-day monitoring period, which restricted visitors from entering many public venues. But those traveling from overseas will still need to take a PCR test on arrival.

Well, still to come, trading in a microphone for the military. The first member of BTS enters South Korea's mandatory military service. How fans are reacting to the news, when we return.

(COMMERCIAL BREAK)

[02:40:00]

(MUSIC PLAYING)

CHURCH: There they are. K-pop supergroup, BTS, is one member less for now. Jin is the first of the all-male group to take on South Korea's mandatory military service. The singer debuted a new look online earlier this week, having chopped off his recognizable looks for a regulation hairstyle.

Fans turned up to see Jin one last time as he reported to base, despite his record label asking them not to. Fans have been overwhelmingly supportive of the band's decision to serve and look forward to them being together again in coming years.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE (through translator): I saw lots of articles about the military duty of BTS, and I realized they are finally going. And now, I also think about how well it can be maintained if one member is missing.

(END VIDEO CLIP)

CHURCH: Well, they might be saving the best for last, and the best they have might be a claim by Meghan, who says she was fed to wolves when, along with Harry, she decided to step back from royal duties. But they may be saving even more serious allegations for the finale of the Netflix docuseries. CNN's Max Foster previews what the last three episodes will entail.

(BEGIN VIDEO CLIP)

MAX FOSTER, CNN CORRESPONDENT: Another week and another installment or set of installments of the new "Harry and Meghan" docuseries on Netflix. And this one promises a bombshell.

PRINCE HARRY, DUKE OF SUSSEX: To see this institutional gaslighting.

MEGHAN MARKLE, DUCHESS OF SUSSEX: And I wasn't being thrown to the wolves, I was being fed to the wolves.

UNIDENTIFIED MALE: They were actively recruiting people to disseminate disinformation.

PRINCE HARRY: They are happy to lie to protect my brother. They were never willing to tell the truth to protect us.

FOSTER: It's not clear what the specifics are here, what is the lie the palace is accused of that's protected William, and worked against Harry and Meghan. That's the detail that everyone, including the palace, will be waiting on. When the series drops, the final three parts on Thursday. Max Foster, CNN, London.

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CHURCH: And finally, this hour, shipwreck that good date back to the 1300s has been discovered at the bottom of Norway's largest lake. The ship is said to be in almost perfect condition. It was discovered during an operation to inspect the lake to make sure the drinking water was safe. Researchers say wooden shipwrecks can be well preserved in deep freshwater lakes because they lack the organisms that usually eat that wood.

Thanks so much for joining us. I'm Rosemary Church. World Sport is coming up next. Then, I'll be back in about 15 minutes with more "CNN Newsroom." Do stick around.

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