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Blinken Back in Israel As Biden Administration Warns about Civilian Cost of War; IDF: Ground Operations Expanding in Gaza; Today: Eric Trump Returns to Stand in Civil Fraud Trial; Ex-Crypto Billionaire Sam Bankman-Fried Found Guilty in Fraud Trial. Aired 6- 6:30a ET

Aired November 03, 2023 - 06:00   ET

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

ANDY SCHOLES, CNN SPORTS: As he was dragged out of the stadium. So it was 7-7 when the possum took the field. Tech went on to win 35-28. So Kasie, maybe they need to keep that possum around somewhere.

[06:00:10]

Maybe keep him in the stadium off to the side or something.

KASIE HUNT, CNN ANCHOR: It is the new mascot. Oh, my God, I love this. I'm obsessed. He's like, Don't, I want to watch the game, too. What are you doing with me?

All right. That is a great way to start the weekend. Andy, thank you very much for being with us this morning.

And thanks to all of you for joining us. I am Kasie Hunt. Don't go anywhere. CNN THIS MORNING starts right now.

ANNOUNCER: This is CNN breaking news.

PHIL MATTINGLY, CNN ANCHOR: Good morning, everyone, and welcome. I'm Phil Mattingly with Erica Hill in New York. Poppy is off today.

Right now, Secretary of State Antony Blinken back in the war zone in Israel as civilian deaths and destruction mount in Gaza. We are expecting Blinken to speak in just moments after meetings with Prime Minister Benjamin Netanyahu and his war cabinet.

ERICA HILL, CNN ANCHOR: Blinken's trip comes after one of the most intense nights we have seen yet in Gaza. In fact, we watched Israeli rockets and missiles rain down live on CNN as flares lit up the night sky. You see some of that footage there, fighting raging on the ground.

CNN has also learned that Blinken, President Biden and his top advisers are warning Israel that the human suffering in Gaza is eroding public support for the war, and the outcry for a ceasefire could reach a tipping point.

The Israeli military says its troops have completely surrounded Gaza City. This is some of the latest video, just in this morning from those ground operations.

Casualties are rising on both sides. The IDF now says 23 Israeli soldiers have been killed since that ground assault was launched in Gaza.

MATTINGLY: And this morning, the Palestinian Red Crescent says Israeli strikes near a hospital blew out the windows, and parts of the ceiling came down and injured at least 21 civilians, including women and children who'd been sheltering inside.

We're going to start with Jim Sciutto, who is live for us in Northern Israel.

Jim, with the secretary of state back on the ground, clearly the ground operation advancing at a level I think some Israelis would say is faster than expected, this is a huge moment. What are the stakes today?

JIM SCIUTTO, CNN CORRESPONDENT/ANCHOR: I think you could call this a mission of moderation from the U.S. secretary of state, as you said, meeting with Israeli political leaders Benjamin Netanyahu but also the war cabinet.

Part of the message is -- and and he said this before he took off from the states -- encouraging Israel to take steps to protect civilians in Gaza as U.S. concern grows about the fate of civilians there, particularly with some of the air strikes we've seen this week, including on the Jabalya refugee camp where Israeli forces targeted a Hamas leader, but many civilians died in the attack, as well.

In addition to the message he's delivering here, he's going to follow this trip with a visit to Amman. Remember, President Biden, in his initial visit to the Middle East after October 7th, was meant to go to Amman, meet with Arab leaders after his stop here in Israel.

That trip was cancelled following the attack on the hospital in Gaza, initially blamed on Israel. Of course, U.S. intel has since assessed that was a Palestinian rocket.

Regardless, we now have the U.S. secretary of state, the top diplomat, going to Amman to meet with Jordanian leaders and others in an attempt to bring them on board to some degree for a way forward.

And the concern not just about Israeli military activity in Gaza, but efforts to prevent this war from expanding to the Northern front here where we are, facing Lebanon and Syria, as well as the attacks we're seeing coming from as far afield as Yemen, the Houthi-backed rebels there.

MATTINGLY: Jim, when you talk about the fears and concerns related to expansion, there is no more important marker than what we're going to hear today from the leader of Hezbollah, Hassan Nasrallah, for the first time, really, in a tangible manner since the war began.

You and I have been talking about this all week. What are you listening for in what I think we expect to be an hours-long speech? SCIUTTO: You know, it's listening to what he has to say, but more

importantly, what the fighters loyal to him do. And we got a sense of that yesterday when there was a real uptick, a spike in rocket attacks across the border from Southern Lebanon here in the Northern Israel, at least a couple of dozen.

Our team was out, and we saw Israel's missile defense system, the Iron Dome, catch two of those rockets in the air. It was a definite uptick.

Will his words today signal that that's just a taste of what's to come? I mean, he can certainly be expected to express solidarity with his brothers in arms, Hamas, which he's done already.

But to come out and make this public speech, not just to his supporters but to the world, a lot of anticipation, and Hezbollah always media savvy, social media savvy, is releasing these videos portending a major statement.

So we'll see what he has to say. But more importantly, I'll tell you Israeli forces up here, as well as U.S. intelligence, is watching more closely as to what those Hezbollah fighters do in response to Nasrallah's statements.

[06:05:09]

MATTINGLY: Yes. Words, but also actions. Jim Sciutto, we'll be with you all show. Thank you.

HILL: Joining us now from Tel Aviv, IDF international spokeswoman Major Libby Weiss.

Good to have you with us this morning. Taking a look at what we saw overnight, this escalation, the intensity in Gaza, the fact that Gaza City is now encircled, there is a note that IDF forces were engaging in face-to-face combat.

Can you give us a better sense? Is this a few soldiers, or is this more widespread?

MAJOR LIBBY WEISS, IDF INTERNATIONAL SPOKESWOMAN: We are continuing to expand our ground operations in Gaza with a very clear focus, and that is to dismantle Hamas, and we know that Hamas is deeply entrenched in that area. I mean, they've invested millions and millions of dollars over the years to be as entrenched as possible.

But we are facing them, and we are dismantling them man by man.

HILL: So it's more than just a few soldiers, just to clarify, dealing with that face-to-face combat, essentially?

WEISS: For obvious reasons, I won't expand on specific troop numbers, but certainly, the ground operations are expanding. And we are facing the threat that Hamas has posed to our people, and going after them as best as we can.

HILL: There are multiple outlets, among "The New York Times," reporting that the U.S. is actually flying drones over Gaza as part of this search for hostages, can you confirm that?

WEISS: I can't confirm that. It would be best to direct that to -- to the U.S. But of course, we understand that many countries are deeply concerned about the fate of the hostages being held by Hamas right now.

And the fastest way for them to come home would be for Hamas to release them immediately, to release civilians immediately, have them come home. What they did was a war crime, and these hostages shouldn't be held there.

And we can understand that much of the world is deeply distressed, as we are, about their well-being.

HILL: As this continues, being there, having Gaza City surrounded, is there encircled, rather, has there been any more evidence that's been found of hostages in that area?

WEISS: Well, I can't elaborate on the specifics. We want to make sure that we are being as cautious as possible to allow our soldiers to continue with their efforts. And we hope that they are going to be rescued and that they -- again, the fastest with for them to come home would be for Hamas to release them immediately.

HILL: Hamas had warned yesterday that the Israeli bombing is endangering the lives of the hostages. I recognize that's coming from Hamas, but we are also hearing from humanitarian aid organizations and from families who share a similar concern.

What is the IDF's level of concern when it comes to the location of those hostages and their safety at this point?

WEISS: Their safety is a top priority for us. We are a small country. We all feel deeply and personally connected to every single one of those hostages. They're not strangers to us, and we are thinking about them at all times.

And having them come home safely is a top priority, and that goes hand in hand with our mission of dismantling Hamas. We know that it's a complicated operational reality. That is the nature of the -- this war that Hamas launched.

But of course, the well-being of those hostages is a top priority for us, and it goes hand in hand with our goal of dismantling Hamas.

HILL: As you know, Secretary Blinken is in Israel today, where he has said he will be urging Israel to take, quote, "concrete steps to protect civilians."

This morning 13 Democratic senators here in the U.S. released a letter. They're calling for a, quote, "short-term cessation of hostilities" in Gaza, urging Israel to allow humanitarian aid in. Is a humanitarian pause or any break in a conflict on the table?

WEISS: That is something that, on the political level, would have to be decided. And we will, of course, in the IDF facilitate whatever decision is made.

It is important for me to say that we are listening to our American counterparts and are very grateful for their support.

And in the meantime, we're also continuing to facilitate the entrance of humanitarian goods into the Gaza Strip. More than 300 trucks have gone in with humanitarian goods, specifically, food, medicine and water for the civilians in Gaza. They are not our target in any capacity.

And we will continue to dismantle Hamas, and to do that until we get any other directive.

HILL: I do want to get your take on this quickly before we let you go. One of the 13 senators who signed that letter, Senator Chris Murphy of Connecticut, had released a separate statement yesterday in which he called the civilian death toll in Gaza, quote, "unacceptable and unsustainable." And went on to write -- and I'm quoting him here -- "I urge Israel to immediately reconsider its approach and shift to a more deliberate and proportionate counterterrorism campaign, surgically targeting Hamas."

How do you respond to that criticism and that request?

WEISS: Well, I won't comment specifically on the exact complaint that he expressed. What I can say is that more than two weeks ago, we instructed civilians in the Northern part of the Gaza Strip to move to the Southern part of the strip.

[06:10:07]

We provided them this warning. We know that more than 800,000 of them have moved to a safer part of the Gaza Strip. And I'd like to say that we did this despite the fact that on October 7th, that nearly a month ago, Hamas had no warning to the civilians in this country.

They went after them deliberately and intentionally. That is not what we are trying to do in the Gaza Strip. We are providing a warning in advance, to our operational detriment, and we're doing this because we want to minimize the impact on civilians.

But certainly, at the end of the day, Hamas is responsible for the well-being of the civilians in the Gaza Strip. They should be facilitating the movement of civilians to safer areas, within the Gaza Strip.

And effectively, we should not be the only party in this conflict concerned with the well-being of the civilians. That is also a responsibility that Hamas has as the sovereign in the Gaza Strip.

HILL: Major Libby Weiss, we have to leave it there this morning. Thank you.

WEISS: Thank you.

MATTINGLY: Secretary of state Antony Blinken is back in the war zone this morning to show support for Israel but warning about the growing humanitarian crisis in Gaza.

HILL: And new this morning, President Biden facing mounting pressure at home to deal with the suffering. As we've mentioned, 13 Democrats in the Senate now calling for a short-term cessation of hostilities to allow for more aid. The impact ahead.

(COMMERCIAL BREAK)

HILL: The Republican-led House has passed a $14.5 billion aid package. That is aid for Israel alone. It does not include funding for Ukraine. The bill is also DOA in the Senate. Majority Leader Chuck Schumer has already said he won't take up the House bill.

[06:15:12]

The White House, for its part, says President Biden will veto any aid package that does not include assistance for Ukraine.

And new this morning, 13 Senate Democrats are now pushing for a pause in military activity in Gaza, in a joint letter released this morning which calls for a short-term cessation of hostilities to allow for the release of hostages and to provide humanitarian aid.

Illinois Senator Dick Durbin was the first member of the caucus to call for a ceasefire during his appearance on this show yesterday.

(BEGIN VIDEO CLIP)

POPPY HARLOW, CNN ANCHOR: Is a ceasefire needed now?

SEN. DICK DURBIN (D-IL): I think it is, at least under -- in the context of both sides agreeing. For example, the release of those who have been kidnapped should be part of this, immediate release. That should be the beginning of it.

Efforts should be made to engage in conversation between the Israelis and the Palestinians. We need to have a resolution in the Middle East that gives some promise for the future.

(END VIDEO CLIP)

MATTINGLY: It is a tangible shift from some of the White House's closest allies. It's happening at the exact same time Secretary of State Antony Blinken is back in Israel meeting with Prime Minister Benjamin Netanyahu and other senior officials to press them on the ongoing offensive in Gaza.

Now, before leaving Washington, Blinken said he had planned to make it clear how the U.S. feels about the growing loss of civilian life.

(BEGIN VIDEO CLIP)

ANTONY BLINKEN, U.S. SECRETARY OF STATE: How Israel does this matters. We will focus, as well, on steps that need to be taken to protect civilians who are in a crossfire of Hamas's making, and we want to look at concrete steps that can be taken to better protect them. (END VIDEO CLIP)

MATTINGLY: CNN's Natasha Bertrand joins us now, live. This is a very delicate diplomatic dance that's ongoing, not just for the secretary of state but for all U.S. officials.

Can you take us behind the public statements? What are the kind of goals that the secretary of state has with this visit? What does he hope to secure from the Israelis?

NATASHA BERTRAND, CNN CORRESPONDENT: Well, look, Phil, I think first, it's very important to note that the administration is getting increasingly concerned by the death toll, the rising death toll of civilians inside Gaza.

And so one of the key priorities for Blinken is going to be to get an update on the military operation inside the Gaza Strip, as well as to discuss concrete steps that the Israelis can take to minimize those civilian casualties.

That is going to be a key part of his message here, because the administration believes that it is going to get increasingly difficult for Israel to continue prosecuting this war as long as the images keep emerging of children and women being pulled from the rubble of these air strikes.

And so that's going to be a key priority here. But another one, of course, is going to be getting sustained aid into Gaza. He said that there are about 50 to 60 trucks of aid per day going into the Gaza Strip, but he wants to see that get up to 100, if not more, and so that sustained aid is going to be key.

But then, a third priority for him is going to be the day two question. What happens if and when Israel manages to degrade Hamas to the point where they no longer govern the Gaza Strip? Who then can be responsible for governing this very large population of Palestinians?

So that is something that he is going to be discussing, because while many people say it is premature at this point to talk about what comes after this military operation ends, the administration does not want to see Israel becoming occupying force inside Gaza.

And so the question then becomes, who can take that on? So that's going to be part of his discussions.

And then in relation to that when he visits the Jordanians, he wants to reassure them that Palestinians are not going to be expelled en masse from Gaza, because that is not something that the Jordanians or other regional partners want to see either, Phil.

MATTINGLY: Yes. And it's been notable in the president's calls with King Abdullah, also President El-Sisi. That is becoming notable inclusion in the readout of those calls from the White House.

I do have to ask, you know, every day I'm struck by the convergence of so many complicating factors. And another one happened yesterday. Your reporting suggesting Syria has agreed to send a Russian missile system to Hezbollah. What do we know here?

BERTRAND: Yes. This is a potentially extremely complicating factor here.

So Syrian President Bashar al-Assad, we are told, has agreed to provide Hezbollah, the Lebanese militant organization, with a Russian air defense system. And it is apparently going to be delivered by the Wagner Group, which is that Russian mercenary organization.

Now, these are all connected, because they all really operate inside Syria. So Hezbollah is backed by Iran. Iran supports Assad. Russia also supports Assad. And all of this is coming together, of course, at a very, very delicate moment when it -- when there are serious concerns across the U.S. government that Hezbollah could join the conflict on that Northern border with Israel.

So having a missile defense system that is being delivered by Wagner potentially, we don't know yet if it has been delivered or the status of that. That could really, you know, intensify this conflict in a way that the administration has been urging the Iranians and Hezbollah and other Iranian proxy groups not to do.

[06:20:08]

So it is definitely a concern, but it just shows just how many actors there are who could potentially join this conflict and make it even worse, Phil.

MATTINGLY: That's such an important point. Natasha Bertrand, thank you.

HILL: Eric Trump will be back on the stand today in the Trump family's civil fraud trial. This after some contentious testimony yesterday. Let's hear what he had to say about financial statements at the Trump Organization, next.

MATTINGLY: And former crypto king Sam Bankman-Fried found guilty last night of fraud and conspiracy. What that conviction could mean for the future of the cryptocurrency market. We'll have more.

(COMMERCIAL BREAK)

HILL: Eric Trump is expected back on the stand today in the New York civil fraud trial against the family business. He and his brother, Don Jr., are accused of knowingly participating in a scheme to inflate their father's net worth.

CNN's Brynn Gingras is live at the courthouse this morning. So what are some of the takeaways? A little contentious, as I understand it, some of that testimony so far for Eric?

BRYNN GINGRAS, CNN CORRESPONDENT: Yes. Erica, good morning. Listen, there's a couple things to keep in mind.

These financial statements are at the core of this case. And the brothers took over the family business when their father took over the Oval Office.

[06:25:07]

So the state's attorney wants to know what their role was in preparing these financial statements, which showed an inflation of assets of the family company.

So, they want to know how much they knew about them. Did they play a role in preparing them?

So when states attorneys were questioning Eric Trump about this, it got a little contentious, as he was sort of distancing himself. But the attorney general's office brought up emails, brought up his prior deposition, brought up phone calls, evidence showing that he had knowledge and that he had possibly a role to play in this.

And so it got a little heated on the stand for Eric Trump, but he still, along with his brother Don Jr., denies any direct involvement in preparing those financial statements.

And Don Jr. spent about three hours doing just that, and then he came outside this courthouse, and he spoke to the cameras about this civil fraud trial as a whole. Take a listen.

(BEGIN VIDEO CLIP)

DONALD TRUMP JR., SON OF DONALD TRUMP: Before even having a day in court, I'm apparently guilty of fraud for relying on my accountant to do -- wait for it -- accounting. I mean, think about that. What does that do for literally any other business?

(END VIDEO CLIP)

GINGRAS: And, yes, he said this was a political persecution by the attorney general's office, something that we, of course, heard from his father, as well, as he's taken to the microphone throughout this trial.

Definitely, a little bit of anger coming from the brothers as it pertains to this trial. We will see Eric Trump back on the stand today to finish testimony, in this courthouse, which court ends about 1 p.m. today, Eric.

HILL: Also, Brynn, it sounds like we may hear from Ivanka Trump after a court denied her request to delay her testimony. What -- what happens next here?

GINGRAS: Yes, right. So this judge has ordered that she has to come to testify. That is set to happen next Wednesday after her father goes under oath on Monday, is the expected date.

And the court -- a higher court basically said that they don't accept her attempt, her appeal to -- to put a stay, not only on her testimony, but this entire trial as a whole.

So as of now, they are expecting her to be in court next week. So it's going to be another eventful week here in downtown Manhattan, guys.

HILL: It certainly will, and I have a feeling you'll be there with a front row seat to all of it. Brynn, appreciate it. Thank you.

MATTINGLY: Also this morning, attorneys for Samuel Bankman-Fried are preparing to begin their appeal process after a jury found him guilty of seven counts of fraud and conspiracy for his role in the collapse of the crypto currency exchange he created, FTX.

SBF, as he's become known, could be looking at spending more than 100 years in prison. CNN's Jason Carroll is live with more. I was struck when the jury started deliberating, only four hours.

JASON CARROLL, CNN CORRESPONDENT: Should have been a sign.

MATTINGLY: Yes.

CARROLL: I'm sure that it was. Because he clearly, even before the verdict came down, looked uncomfortable. He was tapping his foot. He clearly looked shaken, though, as the decision came down.

Each guilty verdict that was read, when Bankman basically sunk his head deeper and deeper into his lap.

His parents also in the courtroom, they appeared devastated. The jury found him guilty on all seven counts, including wire fraud, securities fraud, commodities fraud, and guilty of money laundering.

The verdict not a surprise to many who had been following the trial. The prosecution presented an overwhelming amount of evidence, including financial documents; phony balance sheets, which showed lenders that they had money that simply did not exist; incriminating conversations between Bankman-Fried and executives; also, damning testimony from former executives, who said they knew he was taking this money, told him he should not be doing it. and that he went on and did it anyway.

Throughout the trial, prosecutors portrayed him as greedy and ambitious. They say he secretly used FTX, the cryptocurrency exchange, that he founded as his own personal piggy bank; that he used customer funds, basically, for whatever he wanted, whether it be political campaigns, buying luxury property and also to fund that financially- strapped trading business he founded, Alameda Research.

One of the prosecution's star witnesses, his former girlfriend and former Alameda CEO Caroline Ellison, she had already pleaded guilty to fraud and cooperated with the prosecution. She said they lied to investors, lied to auditors about taking customers' money from FTX.

Last night after the verdict was read, the prosecution weighed in on the jury's decision.

(BEGIN VIDEO CLIP)

DAMIAN WILLIAMS, U.S. ATTORNEY, SOUTHERN DISTRICT OF NEW YORK: The players like Sam Bankman-Fried might be new, but this kind of fraud, this kind of corruption is as old as time, and we have no patience for it. It's a warning, this case, to every single fraudster out there who thinks they're untouchable. I promise we'll have enough handcuffs for all of them.

(END VIDEO CLIP)

CARROLL: Bankman-Fried's attorney also released a statement last night saying the following: "We respect the jury's decision, but we are very disappointed with the result. Mr. Bankman-Fried maintains his innocence --"