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Early Start with John Berman and Zoraida Sambolin

Home Depot Security Breach, Obama Meeting with Lawmakers on ISIS; Deadly Southwest Floods; Preliminary Report on MH17 Disaster

Aired September 09, 2014 - 04:30   ET

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

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CHRISTINE ROMANS, CNN ANCHOR: New information this morning on the president's plan to fight ISIS, meeting with lawmakers today, one day ahead of his national address. This as investigators grow closer to identifying the ISIS executioner who has already killed two Americans. We are live with the very latest.

JOHN BERMAN, CNN ANCHOR: Record rainfall. Flooding in the Southwest. We have dramatic new video coming in overnight. This as the rising water turns deadly.

ROMANS: Home Depot hacked. Tens of millions of customers at risk. What you need to know about this unbelievable security breach again -- bigger than Target. Could be bigger than Target.

Welcome back to EARLY START. I'm Christine Romans.

BERMAN: And I'm John Berman. Thirty minutes past the hour right now.

ROMANS: All right. Home Depot confirming a gigantic hack of its payment system that could affect tens of millions of you. It's likely the largest ever breach of a retailer network. Home Depot says the hackers remained in the computers unnoticed for about five months, dating back to April. In that time, they stole credit card data. No evidence they stole debit card PIN numbers.

The breach affects customers who shopped at the 2,200 brick and mortar stores in U.S. and Canada, but not the homedepot.com, I should tell you. No official confirmation yet on how many people had their information compromise. But "The New York Times" is reporting it was more than 60 million. That's 20 million more than the huge hack at Target that rocked the retail world, and caused a lot of soul searching about just how poorly these retailers are protecting your information.

So, now, what if you shopped at Home Depot in the last five months?

BERMAN: That's like everybody, by the way.

ROMANS: Right. The company is offering free identity protection, offering free credit monitoring services for anyone who paid with a card recently. Home Depot will rollout all chip and PIN technology to all of its stores by the end of the year. Security experts, though, say many retailers simply not prepared to defend against the attackers and to protect your sensitive information.

BERMAN: Five months.

ROMANS: And -- yes. And it looks like the inside Home Depot, the executives at Home Depot, it was early last week that they found about it. So, this has gone unnoticed for a very long time. The blogger -- a cyber security blogger who called and said, hey, I'm seeing the credit card information of Home Depot customers for sale on the dark web.

BERMAN: There's how this happened and why this happened that needs to be answered. But for 60 million of us who shopped at Home Depot over the last five months, there is action that needs to be taken. Check your statements. Figure out if there's anything on them.

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BERMAN: President Obama will meet with top lawmakers today to discuss the ISIS threat. This comes a day ahead to the address to the nation on the growing concern about the terror group. Specific details are not yet released, but the president is expected to outline a broad and anti-terrorism plan. This one obviously a big implications for Congress where officials could have to vote on military intervention, ahead of the midterm elections, though not definite yet.

After weeks of a tense political standoff, Iraq has a new unity government in place. Iraq's parliament has sworn in both Sunni and Kurdish deputy prime ministers. Their goal of taking down ISIS is at the top of all the agendas there. The future of Iraq's political climate has been influx since prime minster Nouri al Maliki resigned under pressure last month.

ROMANS: The American people aren't the only ones about to be presented with a plan to fight ISIS. Secretary of State John Kerry headed to the Middle East today. He's going to build support for the U.S. job there. Stops are planned in Jordan and Saudi Arabia.

Elise Labott has more on Kerry's trip and what he hopes to accomplish.

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ELISE LABOTT, CNN GLOBAL AFFIRS CORRESPONDENT: John and Christine, key to the fight against ISIS will be the nations in the region where the group poses the biggest threat. That's why Secretary Kerry leaves later today on this coalition building tour to shore up support from Gulf leaders.

Now, key to this was the formation of an Iraqi government, which took place on Monday. Kerry wants to enlist Sunni Arab help for this new government as it fights ISIS. The Iraqis will need military support. We're talking about arms, training, intelligence, money to pay off Sunni tribes to shun ISIS. You'll also need to stop the flow of foreign fighters into Iraq and Syria, dry up their funding.

But another critical aspect will be driving a wedge between Sunni Arabs and ISIS and delegitimizing the group's ideology. Saudi Arabia and Jordan, where Kerry will be visiting, both have a role to play here and convincing other Sunni Arabs that ISIS is the enemy. Saudi Arabia has been very effective in beating back al Qaeda in the country over the last several years, and analysts say it has unique religious legitimacy to combat ISIS now.

Secretary Kerry will also be seeking help in the growing humanitarian crisis caused by ISIS. There's also the issue of Turkey which neighbors of both Iraq and Syria, Secretary of Defense Hagel will be traveling there this week to firm up their role in the coalition -- John, Christine.

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BERMAN: Our thanks to Elise Labott for that.

Now, while this coalition is being put together, there is violence still raging inside Iraq with ISIS launching attacks even in the midst of Iraq forming a new government. A Sunni town north of Baghdad came under deadly attack form ISIS Monday. The area about 45 miles from Baghdad has been surrounded for months. One suicide bomber struck at the city's perimeter, allowing another to infiltrate into a market in the center of town.

CNN's Jomana Karadsheh is in Baghdad this morning with the latest. Good morning, Jomana.

JOMANA KARADSHEH, CNN CORRESPONDENT: Good morning to you, John.

Iraq has a new government right now. This is something unusual. Iraqi politicians have actually met a deadline, perhaps a sign of how much pressure they have been under from the United States to come together and form this inclusive government. The lineup includes very familiar faces, politicians, Sunni, Shiite and Kurds that we have seen over the years. Just move around into different positions.

Now, two key posts remain vacant. There are disagreements about them and that is the ministry of interior and defense. You can imagine how critical those are for Iraq right now. Prime Minister al-Abadi promising that within a week, he will have -- he would fill these posts and present them to parliament for a vote.

Now, the real thing here is yes, they have formed a government and yes, there is an inclusive and unity government, but there are real political real disagreements, rivalries between these politicians, and they have not really resolved that. They are bringing this into government with them.

So, the real challenge is to see how these politicians are going to work together because politics and violence in this country are very closely intertwined. Another big challenge here to prove to the Sunni-Arab population that this is not just another government where they are nominally represented, that they really have a stake in this, that there will be real power sharing and a change in policy and attitude. That is going to be key for trying to turn the tide against ISIS on the ground here. As we've seen before, the Sunni-Arab population is key to really

changing the situation in fighting ISIS when it comes to their presence in the Sunni Arab areas here.

BERMAN: Jomana Karadsheh in Baghdad for us -- thanks so much.

ROMANS: U.S. officials say they may have identified the masked man seen on the video beheading James Foley. The identification is not 100 percent, but an official tells CNN they have a pretty good idea of who the man is. The authorities are also breaking down the video of Steven Sotloff's video to determine if it was carried by the same man, as many believed.

Meantime, CNN spoke exclusively with the spokesman for Sotloff's family. She says Steve was sold to ISIS by so-called moderate Syrian rebels and the White House has not been supportive of the Sotloff family.

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ANDERSON COOPER, CNN ANCHOR: He was sold at the border?

BARAK BARFI, SOTLOFF FAMILY FRIEND: Yes, we believe that the so- called moderate rebels that people want our administration to support, one of them sold him probably for something between $25,000 and $50,000 to ISIS and that was the reason that he was captured.

The relationship between the administration and the Sotloff family was very strained.

COOPER: Strained?

BARFI: Yes. We do not believe they gave us the cooperation we need. And the Sotloff -- once Steve appeared on that video, the Sotloff family made one simple request of the administration and they were rebuffed on that.

(END VIDEO CLIP)

ROMANS: A number of senators have introduced a bill authorizing up to $10 million for information leading to the conviction of anyone involved in the murders of Foley and Sotloff.

BERMAN: New questions being raised this morning about a Boston area mosque with connections to Islamic radicals, including the ISIS social media expert. At least ten suspected or convicted terrorists worshipped at one Cambridge mosque. One among them, the accused Boston marathon bombers, and Ahmad Abousamra who was raised in Boston. He disappeared in 2006 and reemerged as the propaganda mastermind for ISIS.

Law enforcement says that is too many accused extremists to ignore.

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JULIETTE KAYYEM, FORMER DHS ASST. SECRETARY: At some stage, we have to accept reality, which is a number of people who have taken up arms against Americans, either here in Boston or abroad with ISIS, have an affiliation with that mosque.

(END VIDEO CLIP)

BERMAN: A spokesman for the Islamic Society of Boston, which runs the mosque says, quote, "If we ever observed any criminal or violent behavior, we would immediately intervene and notify the authorities.

Thirty-nine minutes after the hour.

Happening now: deadly flash floods crippling Southwest communities. Hundreds need to be rescued from the rising waters. We have the dramatic video coming in overnight.

ROMANS: Plus, the Ravens Ray Rice suspended by the NFL, terminated by his team. The new video that could cause the running back his career, next.

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BERMAN: Extreme rainfall causing serious problems in the Southwest. I'm talking about flooding in Arizona left one woman dead when her car was swept away. Also, moments of sheer terror for a man plucked from his car just before it was submerged. Firefighters said he thought he could make it across the rushing water, but the force of the floods ended up pushing him off the road into the brush and trees.

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UNIDENTIFIED MALE: We had a rope in place and we walked over to him. We had to smash his window to pass him equipment because he couldn't get his windows down anymore. We're able to pull him out through the window. We couldn't get the doors open. And we secured a life vest and helmet, and walked him to the shore.

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BERMAN: Arizona Governor Jan Brewer declared an emergency as the flooding forced the closure of roads and schools.

ROMANS: Similar situation in Nevada where record setting rain left roadways looking like rivers and dangerous rushing waters. The water left cars and trucks stranded on that road there for 20 miles and 200 kids were trapped in an elementary school in the southwest town of Moapa. They were evacuated safely.

BERMAN: All away across the country, children rescued from a day care center in Portsmouth, Virginia. Isn't that awful?

ROMANS: Terrifying. Look at that, as a parent, can you imagine?

BERMAN: Workers had to get 35 children and several employees across the parking lot by boat. An apartment complex across the street also evacuated. A lot of residents lost their belongings to waist deep water. In just a matter of minutes. ROMANS: And in California, more than 40 water-related rescues reported in the Palm Springs area. When a school was evacuated after a slow-moving storm, flooded roadways knocked out power, major roads were packed much of the day with floating debris, stalled cars. The official from the California Highway Patrol called this one of the worst storms he's seen in the region.

BERMAN: The Baltimore Ravens and the NFL took action and a lot of people thought it should happen a while ago. This time, though, there was a stunning video that surfaced showing Ray Rice hunching his future wife inside an elevator at an Atlantic City casino. The Ravens cut Rice. The NFL suspended the running back indefinitely. Now, he was serving a two-game suspension for this incident when this new video surfaced.

Ray Rice's now former coach says the violent video changed things for the head coach. He says he still feels for the player.

(BEGIN VIDEO CLIP)

JOHN HARBAUGH, BALTIMORE RAVENS COACH: When someone you care about does wrong and is faced with the consequences of doing wrong and rightfully so, it is tough and it is hurtful. And my pain is for both of them as a couple and, you know, going forward. My hope is they can make it work. And from everything that I understand and in talking, you know, to Ray up until his suspension, talking to him a lot, you know, it seemed like they really were working hard and doing well in that direction.

(END VIDEO CLIP)

BERMAN: Now, the White House is also weighing in on this. The White House press secretary was asked repeatedly about the video, since released as they've been overnight, calling domestic violence contemptible and unacceptable.

ROMANS: Changes in store for the Ferguson Police Department, the police department Ferguson, Missouri. The city council announcing plans for a citizen review board to provide guidance for the police. The city also planning changes to its court system which has been criticized as unfairly targeting low income blacks.

Today, the parents of Michael Brown who was shot to death more than a month ago, they will hold a news conference questioning why Officer Darren Wilson hasn't been arrested.

The number of children hospitalized with a rare respiratory virus is rising. The CDC says a dozen states now reporting cases of the strain of a common Enterovirus. One hospital in Kansas City says it has treated nearly 500 children. Confirmed and suspected cases stretch from Utah to Georgia. Officials say children with severe cold symptoms and difficulty breathing should see a doctor.

BERMAN: The new head of the V.A. says he is worried that the department will not be able to attract enough doctors to reduce long delays faced by veterans waiting for medical care. Robert McDonald says the V.A. will need to hire tens of thousands of new doctors and nurses to help fix the shortage. The waiting list scandal was exposed by CNN forced the abrupt resignation of McDonald's predecessor, Eric Shinseki.

ROMANS: So, you know the shortage of nurses and doctors, that they're really going forward. It's so interesting, this new student loan rules, that if you go in demand area like that and you pay your student loan bills, you can have your debt forgiven after 10 years.

BERMAN: Solve two problems at once.

ROMANS: Yes, super interesting. So, we'll see if maybe they should be pushing with the details on that.

All right. Forty-eight minutes past the hour.

Another ground reveal from Apple today. A new iPhone? Possibly an iWatch? What we can expect. We get an EARLY START of your money, next.

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ROMANS: Time for an EARLY START on your money this morning.

European shares are lower following worries about an upcoming vote for Scotland's independence and a new round of E.U. sanctions against Russia. So, some concern in Europe. Also, U.S. stock futures pointing lower this morning as well.

A stock that we're watching closely today, Apple, its product launch day.

Everyone expecting to get a look at a brand new iPhone 6, and it's going to be bigger. Apple is expected to release two sizes, one that's 4.7 inches, and an even bigger 5.5 inches, and that's up from the iPhone 5S' four inches. Also, Apple may finally reveal the much- talked about iWatch.

Apple shares up slightly this morning in pre-market trading. Look at that stock, 23 percent higher this year. Falling from its record high level, ahead of its stock split fell from its record high level. But it is still up more than 20 percent this year.

Everyone wants to know, you know, these new products. What are the gross margins are going to be? Are they going to be able to continue to make so much money?

Speaking of money, the super rich are getting richer. According to a new Federal Reserve report, the wealthiest 3 percent of American households control 54 percent of the nation's wealth last year. That's a big jump when that same share had bottom 45 percent of the nation's wealth than 1989. It's the same time this year of wealth held by the bottom 90 percent, fell to 25 percent. It was 33 percent.

Look at that a few decades ago. These numbers show how quickly the income divide has been growing and gains and wealth have been concentrated at the very top.

BERMAN: A lot of people say that is the story of the generation and times.

ROMANS: Yes. Sorry.

BERMAN: Yes. All right. Fifty-three minutes after the hour.

New this morning, investigators revealing what happened when Malaysia Airlines Flight 17 crashed with hundreds on board killed. Richard Quest has this new report in his hands. He breaks it all down for us right after the break.

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ROMANS: The Dutch safety board releasing a preliminary report this morning on the investigation into the crash of Malaysia Airlines Flight 17. Investigators have been combing through the cockpit voice recorder and a whole lot more.

So, what are the early findings and which questions remain unanswered?

For that, let's bring in CNN's Richard Quest. He joins us from the CNN Center in Atlanta.

This is the report we have been waiting for. Were the flight data recorders tampered with? What -- how did this plane go down? What are the authorities saying?

RICHARD QUEST, CNN AVIATION CORRESPONDENT: Let me answer those questions in quick succession. No, the flight data was not recorded -- not tampered with. The unique signature of the machine and integrity was good.

How -- what actually happened? The word "missile" is never used in the 34 pages of the report. Instead, it talks about the plane receiving an impact from high energy objects, external causes, no warnings. The damage was not consistent with any mechanical fault. Again, external causes.

What this tells us is that this plane was shot out of the sky by a proximity missile, at the sort we have known about since the incident happened.

But what the importance, Christine, and the significance is, it's the first time we had an official document that actually says somebody brought this plane out of the sky.

ROMANS: Richard, did the pilots see it coming? When you listen to the cockpit voice recorder, did the pilots say anything before this plane fell out of the sky?

QUEST: That's the terrifying part. Absolutely not. Though a routine air traffic control instruction, move a bit to the left, change direction, avoid some traffic. And then suddenly, 20 minutes past, nothing. That is the terrifying part about reading the transcript. It's as if a normal air traffic control sort of just move around the sky for weather and traffic and then nothing. No warning.

This missile hit the aircraft at the front of the plane. The plane broke up in midair and you can tell that by the distribution of damage -- of wreckage on the ground.

And perhaps what's most sad this morning, Christine, when you see later in the morning, the pictures from the Ukraine, the site is still virtually untouched.

ROMANS: Richard Quest, thank you for bringing that. Again, breaking this morning, that report about what brought that plane down. Thank you, Richard.

BERMAN: Tragedy and an outrage.

EARLY START continues right now.

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