Return to Transcripts main page

CNN Newsroom

CNN International: JPMorgan Chase to Buy Most First Republic Assets After Bank Becomes Third in U.S. to Fail Since March; 200+ Officers Searching for Gunman Accused of Killing 5 People; U.S. Ship has Arrived with Evacuees from Sudan; Democrats, Republicans Argue as Potential Default Looms; Florida Governor Brushes Off Lawsuit in Growing Feud with Disney. Aired 4-4:30a ET

Aired May 01, 2023 - 04:00   ET

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

[04:00:00]

ANNOUNCER: This is CNN breaking news.

MAX FOSTER, CNN ANCHOR: I'm Max Foster joining you live from London. Bianca is off for the day. We've got breaking news to bring you at this hour. It is that essentially the second largest bank failure in American history has just been announced. It is First Republic. It was taken over by the authorities late last night. And they have sold a large proportion of the assets to JPMorgan Chase.

So, most assets of First Republic Bank, we're being told, are being purchased by JPMorgan Chase. The deal was announced today. It's just been announced and it was arraigned by the Federal Deposit Insurance Corporation. That's the independent government agency that ensures deposits for customers.

Now this is the third American bank to fail in two months. And there was a lot of relief that other banks didn't cause a wider failure in the banking system. But as you can see, it hasn't fully recovered. These medium-size banks are still really struggling in the United States. And there's concern that that contagion may spread to other parts of the world. But so far, the authorities seem to be handling each one on a case-by-case basis.

As I was saying, JPMorgan will take over these assets. So, all those deposits that were held with the bank, customers' deposits are safe for now. So, no great deal of concern. And obviously the authorities trying to get ahead of things before the markets open later on today. We'll wait to see how the markets interpret all of that. But we'll bring you more details on this as we go through the day. But First Republic has failed but its assets have been assured by JPMorgan and the authorities.

Meanwhile in Texas, a community is in mourning and investigators asking the public for help. This man lost his wife and 9-year-old son in a shooting which killed three others. Here's what the county sheriff investigating the case had to say.

(BEGIN VIDEO CLIP) SHERIFF GREG CAPERS, SAN JACINTO COUNTY, TEXAS: My heart is with this 8-year-old little boy. I don't -- I don't care if he was here legally. I don't care if he was here illegally. He was in my county. Five people died in my county, and that is where my heart is.

(END VIDEO CLIP)

FOSTER: Meanwhile, more than 200 officers from law enforcement agencies are involved in the manhunt for the suspected shooter. And there's also an $80,000 reward being offered for any information that could lead to his arrest. An FBI official says they have, quote, zero leads on the suspect's whereabouts. CNN's Ed Lavandera has the latest.

(BEGIN VIDEOTAPE)

ED LAVANDERA, CNN SENIOR NATIONAL CORRESPONDENT: While the hunt continues for 38-year-old Francisco Oropeza, the man who is accused of shooting five neighbors on Friday night here in the town of Cleveland, Texas. The husband and father of two of the five victims is detailing to us exactly how the night unfolded. Wilson Garcia says he was at home with a group of friends when he asked, he and two other men walked over to the home -- their neighbor's home, Oropeza, and asked him to shop shooting is weapons so close to their property because their baby was trying to sleep. He says they asked him just to shoot the weapons on the other side of their property. It was a very intense exchange. Garcia said they had already called the authorities and 911 five times prior to that.

And then ten minutes later, that's when Wilson Garcia says That Francisco Oropeza came back to their house, didn't say anything else and started shooting people. One of the first to die, he said, was his wife. He says that the men then started going the house shooting people in other rooms. Oropeza says one of women told him to get out of the house as quickly as possible because his wife and son were already dead and that they didn't want to lose him because his two other children shouldn't lose both parents. Horrific details that Wilson Garcia is detailing of that night.

In the meantime, investigators continue this man hunt. They have been searching for Francisco Oropeza since Friday night when he was able to flee the scene. But at this point, investigators say they have no idea where he might be.

JAMES SMITH, SPECIAL AGENT IN CHARGE, FBI HOUSTON FIELD OFFICE: But right now, we just do not know. Because if we did, we would have him in custody right now. We do not know where he is. We don't have any tips right now to where he may be. And that's why we've come up with this reward so that hopefully somebody out there can call us. I pretty much can guarantee you. He's contacted some of his friends.

[04:05:00]

Right now, we're just running into dead ends. Right now, we have zero leads.

LAVANDERA: In hopes of trying to get information on Francisco Oropeza's whereabouts, the state of Texas and various law enforcement agencies has thrown together money for a reward. It is $80,000 for information that's leads to the capture of Oropeza. But as I said at this point, investigators say they had lost track of where he was Saturday. They found his cell phone and some clothes discarded in this area. But so far other than that, they have no idea where he might be at this point.

Ed Lavandera, Cleveland, Texas.

(END VIDEOTAPE)

FOSTER: One possible challenge for law enforcement if Oropeza manages to cross the southern border into Mexico. CNN's law enforcement contributor Steve Moore points out that because the suspect is a Mexican national it would complicate any extradition request.

(BEGIN VIDEO CLIP)

STEVE MOORE, CNN LAW ENFORCEMENT CONTRIBUTOR: Being a Mexican national once he gets across the border -- if he does -- they won't expedite for a capital crime. So, we would have to as a nation decide we're not going to seek a death penalty in order to get him back. So, the Mexican government would actually have some kind of influence on the penalty phase of our trial if they can extradite him.

But right now, the FBI is probably coming up with a list of everybody he communicated with. They probably got his phone records. Anybody he talks to, anybody he's friends with, anybody who he thinks might shield him or give him aid. The FBI is probably on them right now.

(BEGIN VIDEOTAPE)

FOSTER: Moore also says that the FBI has tried to anticipate the suspect's next moves based on the evidence that they've obtained so far.

There's yet another instance of gun violence over the weekend involving American teens. This one happened early Sunday morning in a base at U.S. Mississippi on the Gulf Coast. Authorities arrested 19- year-old Cameron Everest Brand for the deadly shooting at a house party. Police say he is the only suspect in a shooting that left a 16- year-old and an 18-year-old dead and four others injured. Brand is being held without bond. His first court date is scheduled for next month.

A group of American citizens are about to step on dry American land and reach safety having fled the conflict engulfing Sudan. 100 Americans and other nationalities made the trip across the Red Sea for Port Sudan. Let's bring end CNN's Larry Madowo now live is Jeddah, Saudi Arabia, where the first U.S. evacuation ship has just arrived. These are some of the last evacuees because this cease-fire isn't expected to last much longer.

LARRY MADOWO, CNN CORRESPONDENT: Right, Max, we understand from the U.S. counsel general here in Jeddah that is about 100 Americans. They're not exactly sure of the number, but this will be the first and largest we've seen of an American operated ship arriving here in Jeddah. Jeddah here in Saudi Arabia has become the main landing point for people evacuating from Port Sudan. Part of it is because of proximity between the Red Sea across from Port Sudan to Jeddah.

But the other one is also that with Khartoum becoming untenable, people are fleeing in troves. They are making the arduous journey across something like 500 miles to more than 830 kilometers to the east to Port Sudan and hoping to get on one of the ships across to Jeddah. So, the biggest evacuation operations so far has been granted by the Saudi government.

We took a trip with the Royal Saudi Navy across from Jeddah to Port Sudan and came back. And across those strips they have evacuated about 5,200. But also, the number of ships is just not enough for the number that need to leave especially from, Port Sudan. And so, that is why, for instance, the Americans have this. This is the U.S. Navy Brunswick. It a military transport aircraft that has about 100 Americans as I mentioned, but also several other nationalities. We're seen Norwegians, Australians, Germans, I believe there's several other countries here as well.

For instance, we understand there's 28 Brits on the ship. This is a continual operation for the Brits. But for the Americans that arrive in Port Sudan over the weekend, there were two major convoys that were coordinated by the U.S. Embassy which had U.S. private citizens of Sudan, as well as locally employed staff and other nationalities, and this is the first of those two convoys that arrived in Port Sudan. So, there's likely going to be more Americans in Port Sudan looking to come here.

We asked the consulate general here in Jeddah if there's going to be more American ships here, he said he cannot speak for sure. But we know suddenly, based on CNN reporting, there are more Americans in Port Sudan that are trying to get across the Red Sea to here in Jeddah.

FOSTER: OK, Larry in Jeddah, thank you.

Meanwhile, Sudan's army and the paramilitary rapid support forces have agreed to yet another cease-fire. It is the sixth once since the conflict between the two groups began just over two weeks ago. But sporadic fighting has continued throughout all of the previous cease- fires.

[04:10:00]

Sudanese doctors are warning that dead bodies left in the streets are creating an environmental catastrophe. They say shortages of food, water and medicine are also putting the country at risk for a humanitarian crisis. Now the U.N.'s World Food Program has lifted the suspension of its operations in Sudan put in place after three workers were killed there. Let's bring in CNN senior international correspondent Dave McKenzie. He joins us live from Johannesburg, in South Africa. We've reported a lot on the people fleeing. But your heart goes out to all the people left in Khartoum, as those people get out of the country. DAVID MCKENZIE, CNN SENIOR INTERNATIONAL CORRESPONDENT: Max, that's

right. I mean, that is a bit of good news for the humanitarian relief, the World Food Program, as you say, is lifting its suspension. After tragically several of their staff members were killed in the early day of this conflict. And it is an extended cease-fire, but as we've been saying for days now, a cease-fire in name only.

You kind of wonder why they keep naming this cease-fire when the fights continues. Eyewitnesses and journalists for CNN saying that fighting has continued in several parts of Khartoum. There's also been insecurity in other parts of the country.

And the word coming from the Sudan doctors' union that awful news that bodies are lying in the streets, presenting a health hazard as well as obviously many days of no public services. They deployed police, expanded police on to the streets of Khartoum -- I'm not sure what impact that will have on the fighting. It's just a very hard to independently verify the information coming from both the Sudanese armed forces and the rapid support force, the paramilitary group that is battling them. And you've had inflated claims certainly over the last few days in terms of the amount of area either side controls and the responsibility for atrocities that are happening.

We do know based on eyewitnesses, though, is that the situation is deteriorating, Max. In the capital, especially with a lack of food, a lack of water, a lack of medicines, everything really for a normal society to function is breaking down. And you have people streaming over the border in the west of the country because of insecurity from other armed militia, into Chad. Those refugees have harrowing stories to tell.

FOSTER: OK, Dave McKenzie, in Johannesburg, thank you. And we'll keep across all of those latest developments around the cease-fire, whether or not it holds. The deadline is looming but the stalemate goes on.

Meanwhile, we'll get you up to date on the debt ceiling crisis in Washington. And why Democrats and Republicans are seemingly stuck over how to resolve it.

Plus, back on the witness stand. The woman accusing Donald Trump of rape faces more questions from his attorney. As cross-examination is set to resume.

And later, the moment a tornado touches down on a highway in Florida, caught on camera.

[04:15:00]

(COMMERCIAL BREAK)

FOSTER: Returning to our top story. After days of uncertainty, JPMorgan Chase is buying most assets of First Republic Bank in a deal arranged by regulators. The Federal Deposit Insurance Corporation announced the purchase deal after taking control of the embattled member on Sunday. The announcement says JPMorgan Chase will assume all of the deposits, and substantially all of the assets of First Republic. All First Republic branches will reopen today as JPMorgan branches. This makes First Republic the second largest bank failure in nation's history.

The economic doomsday clock ticking towards the potential U.S. government default. Republicans and Democrats argued some more on Sunday but didn't make any progress towards resolving the debt ceiling crisis. The Republican-controlled House last week passed a bill to enable the U.S. to continue borrowing so it could pay its bills. But it includes deep program cuts. President Biden has made clear he won't approve. And with the president refusing to negotiate it's still unclear how or when there might be a breakthrough. CNN's Alayna Treene reports from Washington.

(BEGIN VIDEOTAPE)

ALAYNA TREENE, CNN REPORTER: House Speaker Kevin McCarthy accomplished a major feat this week in pushing that bill through the House. But he has a much bigger challenge ahead in navigating how to avoid a default. And it doesn't look like this bill has changed the dynamics here in Washington.

The White House and Democrats are slamming this bill as an unserious proposal that is dead on arrival in the Senate. They're also digging in on their refusing to negotiate any spending cuts that are tied to the debt ceiling.

And that really leaves Congress stuck in a dangerous stalemate over how to move forward. So, the key question now is, what's next? Republicans argue it's time for President Biden to come to the negotiating table and start hashing out a deal. House majority whip, Tom Emmer, reiterated that position on CNN this morning. Here's what he had to say.

REP. TOM EMMER (R-MN): The White House, since this Congress has begun has had no ideas whatsoever except jacking up taxes and spending even more money. We've got to get this right, Dana. And the Senate -- the Schumer Senate, they have no ideas either. Our recommendation is, we pass it through the House, take it up in the Senate, and pass it.

TREENE: So, Emmer argues that the Senate should take this up and pass it. But in reality, that's just not going to happen, the votes aren't there. Most Democrats are even refusing to even consider this bill as a jumping off point for a future deal. But it is worth noting that we are beginning to see some cracks in that position Emmer mentioned. Senator Joe Manchin, he's one of a growing number of Democrats pressuring Joe Biden to start negotiations.

And really, the bottom line here is that Congress is running out of time. Current estimates put the deadline for when a deal must be reached at some point in July. And the house isn't even in this week, they're on recess. So, it's unlikely we'll see them move the ball forward in the coming days. And with the deadline right around the corner, everyday counts.

Alayna Treene, CNN, Washington.

(END VIDEOTAPE)

FOSTER: In the hours ahead, an attorney for Donald Trump is set to continue his cross-examination of E. Jean Carroll. The woman suing the former president for battery and defamation in a civil trial. Carroll has accused Trump of sexually assaulting her in a department store dressing room in the 1990s.

[04:20:00]

On the witness stand last week, she pushed back as Trump's attorney questioned why Carroll didn't get the attention of others in the store at the time. And about the details about her allegations. Legal experts are weighing in on how Trump's attorney is doing in court.

(BEGIN VIDEOTAPE)

SHAN WU, DEFENSE ATTORNEY AND FORMER FEDERAL PROSECUTOR: I don't think it's going that well for him. I used to prosecute sex crimes. And it's a delicate balancing act that you have to confront a complainant that way. I suspect more on his style. It's pretty blustery and may be he's playing for his client Donald Trump.

Part of the problem for him is, he's really raising these 1940s types of notions that unless a rape victim fights and screams then they're basically not being sexually assaulted. He also has a little problem where he can't make up his mind, is he really trying to argue she consented -- which he's saying it didn't happen, versus she's making it up. Arguments like, you didn't scream enough or that you were laughing, because she said she laughed to try to keep Trump off of her. That goes whether or not you're consenting not just making the whole thing up.

(END VIDEOTAPE)

FOSTER: Carroll has testified she was afraid of Trump at the time and was worried he would retaliate. She said she only felt comfortable telling her story when other women began speaking out during the Me- Too movement.

Florida Governor Ron DeSantis is again brushing off the lawsuit filed against him by Disney. The feud between the two escalated this past week, with Disney suing DeSantis on Wednesday. Alleging the governor is waging a targeted campaign of government retaliation because Disney spoke out against what critics described as DeSantis' so-called "don't say gay law." On Thursday, the governor called the lawsuit political and without merit. But this feud, which has lasted more than a year now, continues to consume DeSantis as he prepares for an expected presidential run next year. Experts say Disney may have a solid case.

(BEGIN VIDEOTAPE)

STEVE BOUSQUET, OPINION EDITOR, SUN SENTINEL: My hunch is that it's going to court and I think Disney has bottomless pockets when it comes to legal, you know, fire power. Of course, this is going to cost the taxpayers of Florida dearly. But this is -- this is a different breed of cat here. This is a First Amendment case. And as Disney argues in its court filings, the government cannot punish you for speaking your mind. I think if Disney keeps the focus on the First Amendment issues they might be on solid legal ground. Because what makes this interesting is there's a whole long paper trail of Ron DeSantis making statements that appear to be retaliatory in nature against Disney. And that's a violation of Disney's right to protected speech.

JULIAN ZELIZER, HISTORIAN AND PROFESSOR, PRINCETON UNIVERSITY: You got to pick a fight with someone, or an organization this large and you're not going to win it if it belittles you, and it makes you look kind of smaller politically. It's also just distracting. This is now consuming everything. I mean, a few months ago, people were focused on his reelection success and the way he expanded his coalition in Florida. And now it's Disney, Disney, Disney. In the end, if he's going to paint himself to be a fighter, he's going to have a pretty big opponent down the line with President Trump. So, this might be a test case that's making the Trump people pretty happy.

(END VIDEOTAPE)

FOSTER: We could soon know whether the slate of Republican presidential contenders will include the party's only Black Senator. South Carolina Senator Tim Scott has been testing the waters for months regarding a potential White House bid. In February he began a listening tour and he launched a potential exploratory committee last night at a town hall. In Charleston on Sunday, Scott indicated that a final decision is close at hand.

(BEGIN VIDEO CLIP)

SEN. TIM SCOTT (R-SC): It is time to make the final step. Please tell your friends, be in attendance, know Charleston, more details coming your way, we will have a major announcement and you're going to want to be there.

(END VIDEO CLIP)

FOSTER: Scott said the announcement will be made in about three weeks on May 22nd.

Now Paraguay, a huge win for the ruling party, as its candidate Santiago Pena wins the presidential election. Election officials say he won more than 42 percent of votes compared to 27 percent for his rival. His when underscores the dominance of the conservative Colorado Party. An economist and former finance minister is promising economic equality for all.

(BEGIN VIDEO CLIP)

SANTIAGO PENA, PARAGUAY PRESIDENT-ELECT (through translator): From tomorrow, we will begin to design the Paraguay that we all want, without gross inequalities or unfair social asymmetries. We have a lot to do. After the last few years of economic stagnation, with the fiscal deficit, with the worrying unemployment rate and increase in extreme poverty, the task that awaits us is not for a single person or just for a party. I call for unity and consensus to achieve our destiny of collective well-being and prosperity without exclusions. (END VIDEO CLIP)

[04:25:05]

FOSTER: Pena is facing the challenge of revving up Paraguay's farm- driven economy as the country faces a rising deficit and growing poverty.

Parts of the southern and eastern U.S. will be assessing the damage from tornadoes in the hours ahead. The National Weather Service confirms that one hit the coastal city of Virginia Beach on Sunday evening.

The man who shot this video said he was eating at a restaurant when sirens went off. He went outside to see what was going on and then warned people inside. Law enforcement and the fire department are now helping residents impacted by the storm damage. Other crews are responding to reports of gas leaks.

And this next video captures the moment an EF-2 tornado touched down in Palm Beach Gardens, Florida. The winds were so intense, they filmed a car multiple times on the highway. You can also see the funnel cloud and debris flying through the air. So far, though, no serious injuries have been reported. Local officials are assessing the damage across the region. Amazing.

A key U.S. government rule that blocked thousands of migrants from entering the country is about to expire. And cities on the border are getting ready for a potential wave. We'll hear from one border city mayor about the challenges that he's facing.

Plus, Russia launches a new wave of strikes as Ukraine prepares for a counteroffensive. We'll have all of the latest in a live report, just ahead.

(COMMERCIAL BREAK)

FOSTER: Welcome back to CNN NEWSROOM. I'm Max Foster. If you're just joining us, let me bring you up to date with the top stories at this hour. First Republic Bank has been the third U.S. bank to fail since March. Most of the bank's assets are being purchased by JPMorgan Chase.

[04:30:00]