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Hunter Biden Plea Deal In Peril; Prosecutors, Hunter Biden Agree To More Limited Plea Deal. Aired 12-12:30p ET

Aired July 26, 2023 - 12:00   ET

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

[12:00:00]

DANA BASH, CNN HOST, INSIDE POLITICS: Welcome to Inside Politics. I'm Dana Bash. Right now drama in Delaware. Hunter Biden's plea deal is crumbling inside a courtroom. Prosecutors and defense attorneys are trying to see if they can put it back together.

Let's go straight to CNN's Evan Perez. Evan, what happened?

EVAN PEREZ, CNN SENIOR JUSTICE CORRESPONDENT: While the judge, Dana, is saying in court to the two sides that she has concerns as to whether the two agreements that the two sides had come to terms with. One of them having to do with Hunter Biden agreeing to plead guilty to two misdemeanor tax charges, failing to pay his taxes on time in 2017 and 2018.

And then the second agreement having to do with a gun charge under which the government says, you know, they will wipe it away if he agrees to a diversion program, a program whereby, you know, if he satisfies all of the conditions that the court sets out, that simply goes away.

This is him purchasing a gun during the time that he was addicted to drugs and did not qualify to purchase a firearm under federal law. And this is a serious charge, it could get up to 10 years in prison as a result of that charge. And so, it's very much in Hunter Biden's interest to have these two things very linked.

And what happened is during this court hearing, the judge Maryellen Noreika, she's a Trump appointee. Essentially, she started pulling a tiny little thread, trying to make sure that Hunter Biden understands what he is pleading to. And she pulled out that one little thread, and the entire cloth kind of came tumbling down because it was clear that the Hunter Biden legal team and the prosecution had different understandings of what they had agreed to.

And so, now we're in a recess, the judge has asked the two sides to talk about it. And to figure out whether there is a deal or whether there is something, you know, something else that's going to come from this hearing today. She could simply just tell them go back and work this out or she could reject this in the end, right?

One of the things that we did hear though, at the top of this hearing was Hunter Biden did say, he was ready to plead guilty to these two misdemeanor charges. And so that's where things stood before the judge started asking some very important questions that it appears the two sides were not ready to answer. Dana?

BASH: Before I let you go, I just want you to quickly Evan, put this in context. Let our viewers know that you and I right before the show, we're texting a little bit about how rarely this kind of thing happens. Can you further explain?

PEREZ: We're going to censor some of those texts that what you and I were exchanging because we were so astonished, and we were so surprised. This doesn't happen ever. I mean, this is just so strange, especially for the two sides to not have a firm agreement about what it is they had agreed to. Obviously, this is a historic thing, right.

The son of the sitting president is coming into a federal courthouse and pleading to crimes. So, from the beginning, this is just a very unusual day. But certainly, what we've seen trends transpire over the last hour or so, is just something out of this world.

BASH: Evan, I know you're working your sources, so just let us know when you want to come back up with any more information. Here to talk more about what exactly is happening right now in Delaware, CNN's Sara Murray, former federal prosecutor Shan Wu, and former prosecutor for the Southern District of New York, Elie Honig.

Sara, I want to start with you, because you have been talking to sources all in and around this almost plea agreement for months and months. And what does seem to be striking are the kinds of questions Evan mentioned this, that the judge is asking.

And most specifically, it is about whether or not these two minor charges in the scheme of the way that things could be charged misdemeanors and deferring a gun charge. Whether this means the federal investigation into Hunter Biden is over. Can you explain this?

SARA MURRAY, CNN POLITICAL CORRESPONDENT: So, this has been a lingering question, because David Weiss, a U.S. attorney overseeing this investigation has been in correspondence with Republicans on Capitol Hill who want to hear from him.

And in a number of these letters, he's made a point of saying, you know, this is an ongoing investigation or suggesting that when he comes to the Hill to testify, he's offered to come in September or October that there may be things that he can't talk about because of an ongoing investigation.

[12:05:00]

And a lot of us looked at that and sort of read it as, of course, the justice department is going to refer to this and Weiss is going refer to this as an ongoing investigation when Hunter hasn't formally entered his plea, when the judge hasn't signed off on it, when we haven't gone through the sentencing process. But there was a lingering question, is there another part of this investigation that's going on here?

And this is what prosecutors are affirming in court is that this investigation is ongoing. And this appears to be a source of, you know, the tension that led to this plea deal to crumble. The question of, you know, what exactly is included in the scope of the plea deal? And by entering into this plea agreement, is Hunter Biden essentially making sure that he's not going to be charged with any other crimes as part of this investigation.

And I think Hunter Biden's team felt like this plea deal was going to be the end of it. They were going to put his legal troubles behind him. And it sounds like prosecutors are not willing or able to make that guarantee. And now they're in another way of research trying to figure it out.

BASH: How does this happen?

SHAN WU, FORMER FEDERAL PROSECUTOR: Plea deals break down all the time, but not in high profile cases where there's been this much time to iron out the details. So, this particular fact that they kept saying, Weiss keeps saying it's an ongoing investigation, struck me as troubling from the beginning, as a defense counsel putting on that hat.

Now, he could be saying it for a couple of reasons. One, it could be just as you were saying, Sara, that they hadn't done the plea deal yet. So therefore, it's still open. Two, he could be saying it for kind of political cover. And that will help him when he goes to the Hill to say, oh, I have an ongoing investigation, I can't talk about it.

But for Hunter Biden's lawyers, it's like, you know, what do you talk about. Why should my guide plead guilty? If you're saying, there's still stuff out there. You can't, and I think the judge probably said this to them, you can't have your cake and eat it too.

So, the fact they didn't cover this ahead of time is really sloppy on the prosecution's part. For Biden's team, if it's ambiguous, it's good for them. But the fact that the judge is pointing out now, that's when the prosecution they should have taken care of this a long time ago.

BASH: And Elie Honig, what we're -- at least we thought we were talking about what this plea deal was two misdemeanor on two tax issues and -- two misdemeanors on tax issues and again, deferring a gun charge. But what has been kind of in the zeitgeist and what Republicans have been screaming about politically speaking.

Is that the DOJ should be investigating more about the questions of whether or not Hunter Biden did anything that was illegal criminal, when it came to the connections that he had to Ukrainian businesses to Chinese businesses, which have so far proven come up. There's been no evidence at all. And the thought was because the DOJ didn't charge him with any of this, it meant that there wasn't enough evidence to charge him on that.

In today's hearing, according to our reporters there, the prosecutors highlighted Biden's substantial income from Ukrainian and Chinese energy companies. As a part of the question of why Hunter repeatedly missed federal tax deadline. Does that tell you anything? ELIE HONIG, FORMER ASST. U.S. ATTORNEY, SOUTHERN DISTRICT OF NY: So, today's developments tell me that DOJ is still investigating in a meaningful way, and that they're not necessarily willing to close the books altogether on Hunter Biden, perhaps that's what some Republicans on Capitol Hill were hoping to see.

The key problem here, the fundamental disconnect between the parties is this. When Hunter Biden was ready to go into court and plead guilty to two tax charges and a gun charge, he clearly was going to be covered for those charges, meaning he would not be charged again in the future for those charges, or anything substantially covered by them, substantially related to them.

But the big question, which apparently the parties have not come to a full agreement on is, when he enters those guilty pleas. Is he covered for other conduct to use Evan's reporting? Is he covered for potential foreign lobbying violations? Is he covered for potential money laundering violations? We do not know how substantiated those allegations are that reporting is, but that's the question.

How broad is his coverage? And the fact that the parties did not have that written out and completely on the same page, and a full understanding on that and went into court today is a failure by both sides here. And that's why we couldn't see this deal in jeopardy.

I think it's important to note lawyers do sometimes get together under the gun at the last moment and work things out. And that's what waiting to see. But the fact that they went in there without having a complete understanding on that is really inexplicable to me.

BASH: Inexplicable Elie, but Sara, I mean, you made this point earlier, Shan, there's no question in the conversations I've had with Hunter Biden's legal team that they were hoping to just plow through this and make it so that the federal investigation much more broadly than these three charges, two and a half charges was over. And that clearly -- unclear if it was the prosecutors who said, whoa, whoa, whoa, are the judge looking at holistically who said, wait a second?

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MURRAY: Yes. I mean, I think it was pretty clear that Hunter Biden's legal team went into this thinking, you know, by the end of the day, we'll be able to say, at least, our legal problems are behind us, if not our political headaches. And it seems right now, like they're mired in both.

And you know, Capitol Hill right now, the Republicans are scrambling to figure out what is going on, asking us for updates. And if we know what's going on with this plea deal, because a lot of you know, what prosecutors have still sort of held out.

There is the meet of what Republicans are really interested in, is how Hunter Biden made his money. You know whether there should have been additional charges beyond these kinds of tax charges? And now I think that's a very big open question. WU: And I want to say, I still think this is really the defense is in the catbird seat here. If they had gotten this through, and then later, the department tries to come back and say, oh, there's still these open charges, they have an argument says, hey, you got a problem. We already resolved this issue.

The fact that it's stuck now, the defense is going to say, OK fine. Go back to your investigation, go through that lousy laptop and see what you can come up with. And his exposure on a tax ultimately, relatively low amount at issue. And that's very helpful for him in terms of what exposure he might face.

So, they're in a better position here, they'd like to get resolved, obviously. But if it had gone through, something comes up later, it would have been helpful. If it doesn't go through at all, do I go, OK, you know, do your worst.

BASH: Yes. I mean, it was pretty obvious based on how the Hunter Biden defense team operated, not just behind the scenes with their negotiations, but their public posture meant that they did feel that they were in the catbird seat, and we'll see if that blew up inside that courtroom.

Elie, Shan just mentioned that, relatively speaking, the taxes that Hunter Biden owed and didn't pay were not that much. I mean, maybe for normal people. $1.1 million and $1.5 million in federal taxes is sounds like a lot of money and it is. A couple of things. One is that those taxes are now paid.

Actually, you know what, standby, I'm going to come back to you on this. I wanted to get to Kara Scannell who is in Wilmington, Delaware. Kara?

KARA SCANNELL, CNN CORRESPONDENT: Hey, Dana. So, the deal appears to be back on track. After I was just out here, the Biden's team had asked for 10 minutes to speak with the prosecution. They were doing that while the judge was off the bench. Then after a bit of period, they came back, the judge came on and she asked them where they are. So essentially, Biden's team is agreeing to the plea deal, but a much more limited in scope deal.

Part of the issue here was that the judge didn't understand exactly what this plea agreement was covering, because it seems to be very all encompassing. So, she wanted them to really narrow down what it was that was covered under this plea agreement.

And so, the prosecutors had said that this plea agreement would cover any charges that were tax charges from 2014 to 2019. Any drug use charges because Biden has admitted that he used illegal drugs and the specific firearm possession charge that is included in this deal.

So, Biden's lawyers got up and said that, yes, they will agree to the prosecution's understanding of the scope of this agreement. And then the judge started to proceed with the usual questioning of Hunter Biden, if he was willingly going to enter in this plea agreement, were any additional promises made. So, things are back on track, and Biden is in the process of beginning his plea to this -- to the tax and misdemeanor charges, and then the firearm offense. But it appeared it was on the brink of collapse over what the potential scope here and what other charges existed because the prosecutor said that this investigation was still ongoing.

And when asked by the judge, if it would cover potentially other charges, he said yes, so that was the friction point. But after this break, they seem to be back on the same page. And Biden is going unless something has happened in the time I've been out here. He's moving forward to pleading guilty to the charges as we expect it today.

And it was just this issue of what the scope of this included and appears that the prosecution is saying very much that their investigation is ongoing. And that what Hunter Biden is fleeing to and what this plea agreement covers are just tax charges, these tax misdemeanor charges, gun possession charges and drug use charges. Dana?

BASH: Kara, thank you so much for that important reporting. I want to bring Evan Perez back in. The idea that it sounds like the Hunter Biden legal team conceded that this plea deal is just specifically to the tax evasion charges and the gun charge leaves open the fact that the prosecution and they're considering the prosecution very well could come back and charge Hunter Biden with other unrelated issues. Some of those you were talking about before.

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PEREZ: Right, exactly. It does appear what the scope of this now is a lot more narrow, certainly it doesn't cover the entire waterfront. If you're Hunter Biden and his legal team, you know, you wanted a deal where all of the things, all of the things related to his overseas business dealings, all of that would be covered up -- covered by this agreement that it appears.

What the government is saying, what the prosecution is saying, is that no, there's some aspects of that are still being investigated, and that what this cover is simply the tax violations that cover the years 2014 to 2019. He's pleading to two years of misdemeanors for those 2017 and 2018 tax years. And then, of course, the diversion program for the gun.

But what this means, Dana, is that there is still the cloud of legal uncertainty for Hunter Biden going forward that it appears, some aspect of this is still being investigated by the justice department. We don't know what the scope of that is. We don't know whether there's new facts that have emerged.

Certainly, we know that as part of our reporting over the last couple of years, that, you know, the FBI and the IRS looked at a number of things, including his business dealings in Ukraine, in China, and in other countries, it's someone who has foreign income, and also whether there was any money laundering, whether there was any violation of the Foreign Agents Registration Act. Those are the things that we know already had been very, very much investigated. The question is, what else is there? And how much longer could that take? And for Hunter Biden, this means this is not over.

BASH: And that really is the key point that you just made there that we've just learned, has come out of the courtroom, Evan, in Delaware. And Sara, just politically speaking, you mentioned this earlier. A big part of the story, as we speak, is the House Republican majority led by the House speaker, leaning further and further into an impeachment inquiry.

Unclear what that exactly means, trying to get information about the other things. The things that are now still left out there, as a big question mark, as part of a federal investigation, in addition to what we know, is being investigated by House Republicans.

MURRAY: Right. And, you know, House Republicans have done a lot already to try to zero in on the Biden family's business dealings, focusing on Hunter Biden's business partners and trying to get various bank records in that kind of thing. They've never been able to tie Joe Biden to what Hunter Biden was doing.

They've never shown the Joe Biden profited off of Hunter Biden's overseas business dealings, despite what some Republicans on Capitol Hill may say, in some of their interviews. And you know, they've sort of been holding out this notion of this impeachment inquiry is maybe this is another mechanism for us to get more information.

And certainly, you know, there's a way that you could do that to get more information around Hunter Biden, even around President Biden. But getting more information from the Feds at this point, when we now have them in court saying these parts are ongoing.

I mean, it's going to make it really difficult for House Republicans to get answers to their questions about what exactly is the scope of the David Weiss investigation? Did he look into, you know, x, y, or z? Did he look into certain payments? I mean, they're not going to answer questions like that when this is still ongoing.

BASH: But it truly is ongoing, and they basically just said that in court, the federal prosecutors.

WU: Right, yes. They did have to say that in court, otherwise, they'd have to concede that it's all close. And for the defense, again, using that perspective, it's been going on for a long time, and they still hadn't figured out what charges to bring corruption, Sara, what they want to do. So, for the defense is like, OK, fine, just keep going with this thing. And we're going to close the book, for sure on any tax concerns, and this gun registration charge.

BASH: Yes. And Elie, just again, politically speaking, Republicans really look at what he pled guilty to today or is in the process of pleading guilty to today as small ball, because they are looking at trying to which they have not as Sara just said, and we need to say this over and over again.

There has been no evidence that we have seen that bolsters or makes those claims true, yet. And when I say those claims about his business dealings, whether there was anything nefarious when he dealt with China and Ukraine and more importantly, any alleged or potential links to his father.

HONIG: Yes. So, this is a much more narrow deal. It sounds like what this will do is close the book on Hunter Biden's personal tax issues, his personal use of drugs and his personal possession of firearms. And that's it, Hunter Biden's legal problems, potential criminal problems are not over here. And it sounds like what's being made clear in the court right now is that anything outside the scope of guns, taxes and drugs is still in play for DOJ. And it'll be interesting to see how this plays politically.

[12:20:00]

On the one hand, if there are people on Capitol Hill, hoping Hunter Biden gets charged with more serious conduct that could happen now. On the other hand, as Sara said, exactly right. DOJ is going to be much more reluctant now to share information to go up to Capitol Hill to talk about their ongoing investigation.

Now, of course, Congress, the House Judiciary Committee, or whoever else is free to investigate at will, but they're going to have to do that on their own. And I don't think they can count on DOJ providing any meaningful information because we now know this investigation is ongoing.

BASH: Yes. And the way you just phrase it guns, taxes and drugs, it's just a reminder that despite the fact that there are other things that might be still investigated by the federal government, by the justice department. This is history happening right now, which is a sitting president son is pleading guilty to federal crime misdemeanor on issues of guns, taxes, and related to drugs.

Thank you so much. Appreciate it. Everybody standby because we're going to go to Capitol Hill to hear what Republicans have to say about this off again, on again. Hunter Biden lead to more breaking news, right after a quick break.

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BASH: Now more on the breaking news. Hunter Biden's plea deal back on it appears. Prosecutors and Biden attorneys are in court after agreeing to a slimmed down agreement covering tax crimes, drug use and gun possession. It follows the near collapse of the deal.

Let's go straight to Capitol Hill and CNN's Manu Raju. Manu, what are you hearing from lawmakers?

MANU RAJU, CNN CHIEF CONGRESSIONAL CORRESPONDENT: Well, Republicans and Democrats still taking in all of the details. Many of them have been in hearings, have been catching this news as it's been unfolding by the minute. In fact, the House Judiciary Committee which has a keen interest in this. I talked to some of the members who are focused on what's going on right now in their hearing room, which is Alejandro Mayorkas, the homeland security secretary being questioned.

But the question for the House Republicans is how they plan to explore and dive into this plea agreement that seems to be back on again, between the president's son and the justice department. They have contended all along that is the initial agreement. And their view was a sweetheart deal. This came from a whole wide range of Republicans on the committee as well as others in the Senate as well.

One of the big questions will be what they plan to do about the U.S. attorney in this case. David Weiss, the Trump appointed attorney from Delaware, someone who is hauled over in the Biden administration. The justice department has agreed to allow Weiss to come testify about this investigation, to try to rebut allegations that there was improper interference from the justice department.

Yes. Jim Jordan, who is the House Judiciary Committee chairman, about whether or not he would bring Weiss to him to testify as the justice department has suggested. He indicated they're not quite ready to bring him in yet because they want to interview up to a dozen other witnesses in this case.

People who are involved in all the efforts behind the scenes, whether they're actually going to get all those people to come and testify is another question altogether. Democrats see this as an effort to try to suggest that there's something nefarious going on when they believe there is not despite testimony that we heard from whistleblowers who suggest that -- from that there was some DOJ interference in this investigation, something that the justice department robots.

But nevertheless, that is all going to be part of the discussion going forward. We'll see how the Republicans react specifically to this latest news hear about this on again, off again agreement. But it's almost certainly, Dana, not going to stop their drive to try to figure out what is going on with this investigation. Some of the Democrats believe who's blame interference trying to impede an ongoing criminal investigation, but something Republicans say, they plan to get to the bottom line.

BASH: Definitely do not see this news changing. The Republicans probably, just the opposite will bolster what they're trying to do on Capitol Hill. Manu, thank you so much for that reporting. And here with me, is CNN's Nia-Malika Henderson, CNN's David Chalian, and Laura Barron-Lopez of the PBS NewsHour, Shan Wu is still with us as well.

David Chalian, just quickly on the politics of this, because we've been talking, understandably, a lot about the legal implications here because it's so unknown. But just the politics of the House Republicans, already the speaker yesterday, already leaning very far into the notion of an impeachment inquiry. And now they have the potential for the ongoing DOJ investigation into some of the allegations that they have been putting out.

DAVID CHALIAN, CNN POLITICAL DIRECTOR: Yes. The fact that if indeed, the result out of court today is there's clear understanding on both sides, that there is ongoing investigation into Hunter Biden, that fits beautifully into the Republican frame.

You have to understand, you noted Kevin McCarthy the speaker, talking the laying the groundwork for an impeachment inquiry, which goes back to these issues as well, because the whole impeachment inquiry that he wants to set up here is about Biden's business dealings. Hunter Biden's business dealings.

And if indeed, Joe Biden in any way, as vice president may have interfered in some way or exerted influence for the benefit of his son or his family. They haven't produced any evidence that that is the situation yet.

But now at an ongoing investigation to Hunter Biden, and it allows them to portray a picture entering into the campaign season to start chipping away at Joe Biden's character. That's the entire sort of premise here. That's the goal of what they want to do. They want to muddy up Joe Biden in the minds of voters ahead of the reelection.

LAURA BARRON-LOPEZ, WHITE HOUSE CORRESPONDENT, PBS NEWSHOUR: But it's not clear that they're even going to have the votes right to conduct this impeachment inquiry. And so that's the thing is, Speaker McCarthy can try to go down this road, but does he even have his entire conference behind him because there are about 18 or so House Republicans that are sitting in Biden won districts. And I think a number of them are really hesitant about going down this road.