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Potential Targets in New York City, New Jersey and Washington on High Alert

Aired August 02, 2004 - 13:39   ET

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

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


KYRA PHILLIPS, CNN ANCHOR: Now the backdrop for the intel overhaul is a code orange alert, now pinpointing five potential financial targets in New York, New Jersey and Washington, and that's apparently based on highly detailed information gleaned from one or more al Qaeda figures recently arrested in Pakistan.
We get the latest on this now from CNN's Deborah Feyerick, at the nerve center of U.S. capitalism, the New York Stock Exchange -- Deb.

DEBORAH FEYERICK, CNN CORRESPONDENT: Well, Kyra, for those people who thought that Wall Street and the New York Stock Exchange would be deserted, quite the opposite is true. Just a short while ago, a dance troupe actually performed two short pieces for about 30 minutes on the steps of Federal Hall, just in front of me. Hundreds of people stopped and watched, some them eating their lunch, taking everything in stride.

Except for the terror threat, it really does appear to be a normal day here on Wall Street. Traders were in position for the opening bell. New York City Mayor Michael Bloomberg doing that honor. He later told people that New Yorkers remain undaunted.

(BEGIN VIDEO CLIP)

MYR. MICHAEL BLOOMBERG: New York City is not going to be cowed by the terrorists, make no mistake about that. We're not going to spare any expense in protecting us, but also the people of New York City know that giving in to terrorism is exactly the wrong thing to do -- Governor.

(END VIDEO CLIP)

FEYERICK: We did speak to some people. They said that they were a little nervous. One woman told us she is definitely planning on working from home during the Republican National Convention at the end of August. Security then, the mayor says, will be increased even more than it already is.

Now, authorities are trying to determine whether the specifics of this surveillance have actually moved to the planning stages, though the mayor does say that there's no information that this plan or that the surveillance in any way is operational.

There is a bit concern that there might be either a truck bomb or some sort of device smuggled inside of a backpack. But right now, the city is simply taking precautions, the ones that we have seen over the last months -- Kyra?

PHILLIPS: Deborah Feyerick, live from the New York Stock Exchange, thank you so much.

And the Pakistan connection may be an al Qaeda computer expert who officials there say gave up some very important information which they passed on to the CIA.

With more on that, here's CNN military analyst Ken Robinson. He's in Washington. Ken, first of all, let's talk about now since Afghanistan has pretty much been blown out with regard as command and control for al Qaeda, let's talk about the switch to a virtual command and control.

KEN ROBINSON, CNN MILITARY INTELLIGENCE ANALYST: Exactly right. They have a virtual al Qaeda network, which is leaderless, which is communicating over the Internet and is enabling them to, with no risk, be able to pass on what we call distance learning -- to be able to take standards and practices for surveillance, for targeting sites, for how to operate, install, maintain an RPG or surface-to-air missile. And they pass it through the Internet, and it's able to be distributed to about 60 countries.

PHILLIPS: And also, with the advantage of an Internet, I mean this is something that it's hard to trace. It's hard to trace e- mails. It's hard to trace any type of virus or things that have been sent forward.

ROBINSON: They have the -- they have, in al Qaeda, what is called stenography. And stenography, if you can imagine, if you take a JPEG, a photograph, which is commonly sent throughout the Internet every single day, let's say it's a picture of a building or it's a picture of a flower or a picture of an animal, within that photograph, they're able to embed an encrypted message. And they share the key to decrypt -- to decrypt that message with the people that they are in communication with.

Where others only see a photograph, they're able to pass messages of command and control back and forth. This is one of the hardest things that the intelligence community is chasing. So, the collection of cell phones, the collection of computer disks, the collection of computers leads to being able to get those keys.

PHILLIPS: So, how long is military intelligence been tracking these terrorists on the Internet and these sites and the communication that's taking place?

ROBINSON: For years. The intelligence community has what they call an Information Dominance Center, where they attempt to analyze all kinds of information that's in the open source and that's in the closed.

You know, the intelligence community -- as was spoken to by the national security adviser a few minutes ago -- the intelligence community focuses on leadership communication at the national level of foreign governments that may threaten us. And what they're talking about now is taking that transition, because you also now have to focus on leadership of terrorist organizations and you have to focus on the leadership of rogue states, which may try to employ WMD. So, this whole reorganization of intelligence and the issues of budget is key to making that better, cheaper, and faster.

PHILLIPS: All right, so when it comes to finding some of the best leads right now, with regard to military intelligence, do you think it's coming from computers that have been seized, or maybe cracking some of these Internet sites or the communication? Or do you think it's still human intelligence on the ground, or spies that have infiltrated some of these terrorist networks?

ROBINSON: It's a combination of all of that, Kyra, but most important is what they call TAREX, the targeted exploitation of stuff -- when you find a PDA, when you get a computer, when you get pocket litter, when you get an address in someone's pocket that then leads you to another place where you find a computer or a PDA.

So, the information that may have come over the last week may not necessarily have come from the interrogation of those who have been captured as much as from that which was rounded up with them.

PHILLIPS: Ken Robinson, our CNN military analyst. Thank you so much, Ken.

ROBINSON: Thanks, Kyra.

PHILLIPS: All right. I'm just getting information on the missing Salt Lake City woman case. We're talking, of course, about Lori Hacking. As you know, the family of Lori Hacking has come forward and asked volunteers to stop searching for her. That's because we are being told that her husband has given some information to police.

Well, now we are being told police have taken that information from Mark Hacking and have decided to hold a news conference -- we are told with possibly a major break in this case. We're going to bring it to you as soon as they step up to the mike.

We're going to take a quick break. More LIVE FROM right after this.

(COMMERCIAL BREAK)

PHILLIPS: Well, as the mystery deepens into the disappearance of the pregnant Utah woman, Lori Hacking, we are now being told there may be a major break in that case. Police are expected to step to the podium in Salt Lake City, Utah. We'll bring that to you live as soon as it happens.

Meanwhile, we're going to check in on business. The New York Stock Exchange -- things a little different there as we check in with Darby Mullany.

Can you hear me OK there, Darby?

DARBY MULLANY, CNN FINANCIAL CORRESPONDENT: Sorry, Kyra...

PHILLIPS: That's OK. I know we were kind of throwing this together at the last minute. I'm sure it's been pretty busy for you -- a lot of security changes. While you're usually listening to what Fed. Chairman Alan Greenspan has to stay, you guys have been listening to what Tom Ridge has been saying at Homeland Security.

MULLANY: Exactly. It has been a very hectic day here at the New York Stock Exchange, but really for the traders here and for investors, it has been pretty much business at usual.

In fact, the markets are shrugging off the latest terror warnings right now. Shares of industry leaders such as Prudential and -- Financial and American Express are lower. But we're not seeing really dramatic moves there either, and that's because most of the traders and analysts say that terrorism fears are already factored into the markets right now.

The Dow Jones Industrial Average up in positive territory -- up 44 points at 10,183. The Nasdaq is also in positive territory, thanks in part to a strong profit report, as far as the Dow is concerned, from the blue chip Proctor & Gamble.

Now, oil is on the retreat. Oil futures hit record highs last week, but are modestly lower today -- Kyra?

PHILLIPS: All right, tell us about the new government study talking about job security, layoffs...

MULLANY: That's right. Of course, that's something that's on everybody's mind. Layoffs occurred at the second fastest rate on record during the first three years of the Bush administration.

According to a new report from the government, the layoff rate rose to 8.7%. That is nearly the same as the 9% rate reached during the 1981 to 1983 period. And workers are going back to work for less money than they earned before.

About 57% who lost full-time jobs had to accept a job that did not pay as much as they once were getting paid. And about one-third of those with smaller paychecks were being paid at least 20% less.

Now, keep in mind this week we also get the jobs report on Friday. Investors and political pundits alike will be keeping a close eye on those all important numbers.

That's the latest from Wall Street. Kyra, back to you.

PHILLIPS: All right. Darby Mullany, thank you so much.

Well, sorting through all of the conversation from Salt Lake City, CNN's Miguel Marquez with more on this search for Lori Hacking that has apparently been ended because of information provided by her husband. What can you tell us, Miguel? I'm told there might be a major break in the case.

MIGUEL MARQUEZ, CNN CORRESPONDENT: Police came out here excitedly a short time ago. They set up a riser (ph), an area for the police chief, Rick Dinse, to come out, in a short time, to make a big announcement, as they put it. I spoke to the lawyers office for Mark Hacking. The person who answered the phone there said that Mr. Gil Athay. Mr. Hacking's lawyer, was aware of this press conference, and that he was going to be monitoring it, and it sounds as though this is the definitive press conference. Certainly this is the first time we've heard from the police chief in this sort of setting before, and it sounds like the Salt Lake City police have a very big announcement to make.

Mr. Hacking, by the way, remains in the hospital, in a psychiatric hospital at this point, still not in police custody.

Back to you.

PHILLIPS: Miguel Marquez, live there from Salt Lake. We'll continue to follow what happens out of there. You'll let us know once you have information. We'll take you again -- once again live. We're going to take a quick break now. More live from, right after this.

(COMMERCIAL BREAK)

PHILLIPS: Guards and guns on the streets of New York and Washington. Financial wizards from Wall Street to D.C. Usually listen to Fed chair Alan Greenspan. Well, today, it's homeland security chief Tom Ridge. Two of the most important financial institutions in the world are the focus for intense new levels of security.

CNN's Mike Brooks has the latest on the impact at the IMF and the World Bank. He's with us now live from D.C.

Mike, kind of set the scene for us and tell us what you've seen.

BROOKS: Well Kyra, here in Washington D.C., at the International Monetary Fund and the World Bank, it's fairly low key. Just within the last hour, the D.C. police did block off a short block in front of the World Bank.

Chief Ramsey, who I spoke to just moments ago, told me that they're doing that as a precautionary measure. They don't think it will affect traffic much at all.

Now on 19th Street and 18th Street, that runs on either side of the World Bank, they also have put up emergency no parking signs and restricted no parking. They've also set up an inspection point a block up from the world bank, so all trucks going in front of the World Bank and the International Monetary Fund -- they're right across the street from each other -- will be inspected by police officers.

You see a stronger police presence than usual, but not compared to what you're seeing in New York City. He also said that you're -- there are many, many plain-clothes people, there is a camera system, a very sophisticated camera system that the D.C. police uses, that can monitor this area. They've used them in the past for the demonstrations that are usually here in April and also in the fall. They're utilizing those to see if there's any unusual activity, but if you go anywhere else in the city, Kyra, you really can't notice that they are on an orange alert -- Kyra.

PHILLIPS: Mike Brooks, live from the streets of D.C. there, thanks so much. We'll check in with you next hour.

Coming up in the second hour of LIVE FROM, live from Salt Lake City, a break in the Lori Hacking case. The police press conference is next.

LIVE FROM's hour of power begins right after this.

(COMMERCIAL BREAK)

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com


Aired August 2, 2004 - 13:39   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KYRA PHILLIPS, CNN ANCHOR: Now the backdrop for the intel overhaul is a code orange alert, now pinpointing five potential financial targets in New York, New Jersey and Washington, and that's apparently based on highly detailed information gleaned from one or more al Qaeda figures recently arrested in Pakistan.
We get the latest on this now from CNN's Deborah Feyerick, at the nerve center of U.S. capitalism, the New York Stock Exchange -- Deb.

DEBORAH FEYERICK, CNN CORRESPONDENT: Well, Kyra, for those people who thought that Wall Street and the New York Stock Exchange would be deserted, quite the opposite is true. Just a short while ago, a dance troupe actually performed two short pieces for about 30 minutes on the steps of Federal Hall, just in front of me. Hundreds of people stopped and watched, some them eating their lunch, taking everything in stride.

Except for the terror threat, it really does appear to be a normal day here on Wall Street. Traders were in position for the opening bell. New York City Mayor Michael Bloomberg doing that honor. He later told people that New Yorkers remain undaunted.

(BEGIN VIDEO CLIP)

MYR. MICHAEL BLOOMBERG: New York City is not going to be cowed by the terrorists, make no mistake about that. We're not going to spare any expense in protecting us, but also the people of New York City know that giving in to terrorism is exactly the wrong thing to do -- Governor.

(END VIDEO CLIP)

FEYERICK: We did speak to some people. They said that they were a little nervous. One woman told us she is definitely planning on working from home during the Republican National Convention at the end of August. Security then, the mayor says, will be increased even more than it already is.

Now, authorities are trying to determine whether the specifics of this surveillance have actually moved to the planning stages, though the mayor does say that there's no information that this plan or that the surveillance in any way is operational.

There is a bit concern that there might be either a truck bomb or some sort of device smuggled inside of a backpack. But right now, the city is simply taking precautions, the ones that we have seen over the last months -- Kyra?

PHILLIPS: Deborah Feyerick, live from the New York Stock Exchange, thank you so much.

And the Pakistan connection may be an al Qaeda computer expert who officials there say gave up some very important information which they passed on to the CIA.

With more on that, here's CNN military analyst Ken Robinson. He's in Washington. Ken, first of all, let's talk about now since Afghanistan has pretty much been blown out with regard as command and control for al Qaeda, let's talk about the switch to a virtual command and control.

KEN ROBINSON, CNN MILITARY INTELLIGENCE ANALYST: Exactly right. They have a virtual al Qaeda network, which is leaderless, which is communicating over the Internet and is enabling them to, with no risk, be able to pass on what we call distance learning -- to be able to take standards and practices for surveillance, for targeting sites, for how to operate, install, maintain an RPG or surface-to-air missile. And they pass it through the Internet, and it's able to be distributed to about 60 countries.

PHILLIPS: And also, with the advantage of an Internet, I mean this is something that it's hard to trace. It's hard to trace e- mails. It's hard to trace any type of virus or things that have been sent forward.

ROBINSON: They have the -- they have, in al Qaeda, what is called stenography. And stenography, if you can imagine, if you take a JPEG, a photograph, which is commonly sent throughout the Internet every single day, let's say it's a picture of a building or it's a picture of a flower or a picture of an animal, within that photograph, they're able to embed an encrypted message. And they share the key to decrypt -- to decrypt that message with the people that they are in communication with.

Where others only see a photograph, they're able to pass messages of command and control back and forth. This is one of the hardest things that the intelligence community is chasing. So, the collection of cell phones, the collection of computer disks, the collection of computers leads to being able to get those keys.

PHILLIPS: So, how long is military intelligence been tracking these terrorists on the Internet and these sites and the communication that's taking place?

ROBINSON: For years. The intelligence community has what they call an Information Dominance Center, where they attempt to analyze all kinds of information that's in the open source and that's in the closed.

You know, the intelligence community -- as was spoken to by the national security adviser a few minutes ago -- the intelligence community focuses on leadership communication at the national level of foreign governments that may threaten us. And what they're talking about now is taking that transition, because you also now have to focus on leadership of terrorist organizations and you have to focus on the leadership of rogue states, which may try to employ WMD. So, this whole reorganization of intelligence and the issues of budget is key to making that better, cheaper, and faster.

PHILLIPS: All right, so when it comes to finding some of the best leads right now, with regard to military intelligence, do you think it's coming from computers that have been seized, or maybe cracking some of these Internet sites or the communication? Or do you think it's still human intelligence on the ground, or spies that have infiltrated some of these terrorist networks?

ROBINSON: It's a combination of all of that, Kyra, but most important is what they call TAREX, the targeted exploitation of stuff -- when you find a PDA, when you get a computer, when you get pocket litter, when you get an address in someone's pocket that then leads you to another place where you find a computer or a PDA.

So, the information that may have come over the last week may not necessarily have come from the interrogation of those who have been captured as much as from that which was rounded up with them.

PHILLIPS: Ken Robinson, our CNN military analyst. Thank you so much, Ken.

ROBINSON: Thanks, Kyra.

PHILLIPS: All right. I'm just getting information on the missing Salt Lake City woman case. We're talking, of course, about Lori Hacking. As you know, the family of Lori Hacking has come forward and asked volunteers to stop searching for her. That's because we are being told that her husband has given some information to police.

Well, now we are being told police have taken that information from Mark Hacking and have decided to hold a news conference -- we are told with possibly a major break in this case. We're going to bring it to you as soon as they step up to the mike.

We're going to take a quick break. More LIVE FROM right after this.

(COMMERCIAL BREAK)

PHILLIPS: Well, as the mystery deepens into the disappearance of the pregnant Utah woman, Lori Hacking, we are now being told there may be a major break in that case. Police are expected to step to the podium in Salt Lake City, Utah. We'll bring that to you live as soon as it happens.

Meanwhile, we're going to check in on business. The New York Stock Exchange -- things a little different there as we check in with Darby Mullany.

Can you hear me OK there, Darby?

DARBY MULLANY, CNN FINANCIAL CORRESPONDENT: Sorry, Kyra...

PHILLIPS: That's OK. I know we were kind of throwing this together at the last minute. I'm sure it's been pretty busy for you -- a lot of security changes. While you're usually listening to what Fed. Chairman Alan Greenspan has to stay, you guys have been listening to what Tom Ridge has been saying at Homeland Security.

MULLANY: Exactly. It has been a very hectic day here at the New York Stock Exchange, but really for the traders here and for investors, it has been pretty much business at usual.

In fact, the markets are shrugging off the latest terror warnings right now. Shares of industry leaders such as Prudential and -- Financial and American Express are lower. But we're not seeing really dramatic moves there either, and that's because most of the traders and analysts say that terrorism fears are already factored into the markets right now.

The Dow Jones Industrial Average up in positive territory -- up 44 points at 10,183. The Nasdaq is also in positive territory, thanks in part to a strong profit report, as far as the Dow is concerned, from the blue chip Proctor & Gamble.

Now, oil is on the retreat. Oil futures hit record highs last week, but are modestly lower today -- Kyra?

PHILLIPS: All right, tell us about the new government study talking about job security, layoffs...

MULLANY: That's right. Of course, that's something that's on everybody's mind. Layoffs occurred at the second fastest rate on record during the first three years of the Bush administration.

According to a new report from the government, the layoff rate rose to 8.7%. That is nearly the same as the 9% rate reached during the 1981 to 1983 period. And workers are going back to work for less money than they earned before.

About 57% who lost full-time jobs had to accept a job that did not pay as much as they once were getting paid. And about one-third of those with smaller paychecks were being paid at least 20% less.

Now, keep in mind this week we also get the jobs report on Friday. Investors and political pundits alike will be keeping a close eye on those all important numbers.

That's the latest from Wall Street. Kyra, back to you.

PHILLIPS: All right. Darby Mullany, thank you so much.

Well, sorting through all of the conversation from Salt Lake City, CNN's Miguel Marquez with more on this search for Lori Hacking that has apparently been ended because of information provided by her husband. What can you tell us, Miguel? I'm told there might be a major break in the case.

MIGUEL MARQUEZ, CNN CORRESPONDENT: Police came out here excitedly a short time ago. They set up a riser (ph), an area for the police chief, Rick Dinse, to come out, in a short time, to make a big announcement, as they put it. I spoke to the lawyers office for Mark Hacking. The person who answered the phone there said that Mr. Gil Athay. Mr. Hacking's lawyer, was aware of this press conference, and that he was going to be monitoring it, and it sounds as though this is the definitive press conference. Certainly this is the first time we've heard from the police chief in this sort of setting before, and it sounds like the Salt Lake City police have a very big announcement to make.

Mr. Hacking, by the way, remains in the hospital, in a psychiatric hospital at this point, still not in police custody.

Back to you.

PHILLIPS: Miguel Marquez, live there from Salt Lake. We'll continue to follow what happens out of there. You'll let us know once you have information. We'll take you again -- once again live. We're going to take a quick break now. More live from, right after this.

(COMMERCIAL BREAK)

PHILLIPS: Guards and guns on the streets of New York and Washington. Financial wizards from Wall Street to D.C. Usually listen to Fed chair Alan Greenspan. Well, today, it's homeland security chief Tom Ridge. Two of the most important financial institutions in the world are the focus for intense new levels of security.

CNN's Mike Brooks has the latest on the impact at the IMF and the World Bank. He's with us now live from D.C.

Mike, kind of set the scene for us and tell us what you've seen.

BROOKS: Well Kyra, here in Washington D.C., at the International Monetary Fund and the World Bank, it's fairly low key. Just within the last hour, the D.C. police did block off a short block in front of the World Bank.

Chief Ramsey, who I spoke to just moments ago, told me that they're doing that as a precautionary measure. They don't think it will affect traffic much at all.

Now on 19th Street and 18th Street, that runs on either side of the World Bank, they also have put up emergency no parking signs and restricted no parking. They've also set up an inspection point a block up from the world bank, so all trucks going in front of the World Bank and the International Monetary Fund -- they're right across the street from each other -- will be inspected by police officers.

You see a stronger police presence than usual, but not compared to what you're seeing in New York City. He also said that you're -- there are many, many plain-clothes people, there is a camera system, a very sophisticated camera system that the D.C. police uses, that can monitor this area. They've used them in the past for the demonstrations that are usually here in April and also in the fall. They're utilizing those to see if there's any unusual activity, but if you go anywhere else in the city, Kyra, you really can't notice that they are on an orange alert -- Kyra.

PHILLIPS: Mike Brooks, live from the streets of D.C. there, thanks so much. We'll check in with you next hour.

Coming up in the second hour of LIVE FROM, live from Salt Lake City, a break in the Lori Hacking case. The police press conference is next.

LIVE FROM's hour of power begins right after this.

(COMMERCIAL BREAK)

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com