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U.S. Tourists Killed; Corrupt Congressman

Aired March 23, 2006 - 13:30   ET

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

KYRA PHILLIPS, CNN ANCHOR: Fire aboard the Star Princess, in the Caribbean between Grand Cayman and Jamaica. Carol Lin working that story for us in the newsroom.
Carol, what do we know?

CAROL LIN, CNN ANCHOR: That's right, Kyra. Here's what we know, that the fire affected some 100 cabins. It started in the passenger area. And it's one thing to talk about this fire. It's another thing to take a look at these picture just in from Jamaica Television, these stills. Look at how the fire spread over multiple levels of that cruise ship. One person did die during this fire, which broke out at 3:00 in the morning. The person died of a heart attack, and about 11 people suffered smoke inhalation. The ship docked right now in Montego Bay. They're still investigating the cause of that fire.

But, Kyra, can you imagine, in the middle of the night, 3:00 in the morning, the loud speaker goes off, as many of these passengers were trained to do when they first boarded that cruise ship, but nobody realizing or certainly anticipating a major fire on that cruise ship.

So we don't know the cause, but we wanted to bring you those dramatic pictures that just came into the CNN Center.

PHILLIPS: All right, we'll stay on top of it. Thanks so much, Carol.

LIN: You bet.

PHILLIPS: A South American cruise, a port call in Chile. A sightseeing trip and a deadly accident. A dozen Americans were killed on a side trip they arranged themselves in northern Chile. Their tour bus went off the road and plunged nearly 300 feet down the rocky hillside. The 12 were passengers aboard a Celebrity Cruise ship based in Florida.

CNN's John Zarrella following that story from there.

John, what do we know?

JOHN ZARRELLA, CNN CORRESPONDENT: Kyra, it's still unclear as to what exactly happened on the side of that mountain, but reports we're getting in is that the driver, who survived the crash, is telling authorities that he had to swerve in order to avoid an oncoming truck, a very, very narrow road. We've also had the opportunity to talk with some other people who took a tour in that same area a couple of days earlier, and they say, to put it mildly, the trip is harrowing, very, very dangerous, very, very narrow, the area where this bus ended up going off the edge and careening some 250 feet down an embankment to where it broke apart.

Now, the cruise ship line, Celebrity Cruise, is based here in Miami, owns the Millennium, operates the Millennium cruise ship, and they -- company officials, the president, held a press briefing this morning and outlined exactly what he knows took place.

(BEGIN VIDEO CLIP)

DAN HANRAHAN, PRES., CELEBRITY CRUISES: The bus in which they were riding swerved to avoid an approaching truck on a rugged mountain highway. The bus apparently ran off the road and plunged 300 feet down a mountainside. Twelve guests on the bus were killed, and two other guests were injured in the accident.

ZARRELLA: Now, this was not, as we've been told repeatedly now, a sanctioned shore excursion by the cruise line. It was not authorized by the cruise line. In other words, for many people who've taken cruises, you know before you reach your port of call, you can book through the cruise desk, through the tour desk on the ship, shore excursions. This was not one of those. It was independently booked by this group of people. And the cruise line president, again, at that news briefing this morning reiterated that they believe that people should be taking the authorized excursions.

(BEGIN VIDEO CLIP)

HANRAHAN: We encourage our guests to take our score excursions, because we have thoroughly checked out the providers, and have a lot of confidence in the providers. What we cannot do is tell guests how to -- what to do on their own time. So our guests do, oftentimes, go off on their own excursions. But we encourage them to take ours because they have been so thoroughly checked out.

(END VIDEO CLIP)

ZARRELLA: We understand from late reports starting to come in from Chile, along those same line, Kyra, that this particular tour group, this particular, Andean Tours, was not authorized, according to officials down in Chile, reports we're getting, was not authorized to be carrying passengers, certainly not authorized by the cruise line itself.

As for the victims, we understand they were from a Bnai Brith (ph) group out of New Jersey and Connecticut. Their identities, of course, are not being released at this point. And the cruise line is saying it planning, and may already have, begun to take relatives on a chartered flight down to Chile to go ahead and get down there to be with their relatives -- Kyra.

PHILLIPS: John, we should definitely hit home on that point. You've talked about it we heard it in the news conference, think about our world travels and how many times we'll negotiate a taxi driver or a bus driver to work out a deal for us, versus going through a travel agent or some other agency. It really is a tremendous risk.

ZARRELLA: Oh, no question about it. And yet this is just a tragic accident. I talked to one travel expert who said, you know, 99 percent of the time, you might take one of these that you book either online before you leave or when you get there. You know, you may get there, you walk off your ship, we always see people holding up sign, take our excursion, and 99 percent of the time nothing will happen. This is a very tragic instance.

But yes, and you know, the issue is, take the sanctioned one is what's recommended by everyone that we spoke with, simply because there's a better chance that at least they have been checked out and are responsible, and that the cruise line is backing them, unlike these independent groups. Unfortunately this one was one of those -- Kyra.

PHILLIPS: John Zarrella, thanks.

From legendary fighter pilot to political power broker, former Congressman Randy Duke Cunningham was larger than life, then his own life caught up with him. Today, he's serving eight years in prison for taking bribes, and his pricey possessions are being auctioned by the government.

Our John king Reports that even before Cunningham's rise and fall in Washington, his ups and downs were already the stuff of Hollywood.

(BEGIN VIDEOTAPE)

JOHN KING, CNN NATIONAL CORRESPONDENT (voice-over): Randy Cunningham and high risk, have been partners a long time.

UNIDENTIFIED MALE: His name is Randy Duke Cunningham and he is a legend of air power.

KING: The Vietnam ace whose daring exploits were an inspiration for Maverick in Hollywood's "Top Gun." And from famous war hero, Cunningham parachuted into a seemingly less risky business, politics.

UNIDENTIFIED FEMALE: Duke Cunningham will be a congressman we can be proud of.

KING: Now 16 years after that first campaign, San Diego Congressman Duke Cunningham's exploits are once again the stuff of Hollywood.

REP. RANDY CUNNINGHAM (R) CALIFORNIA: I broke the law, concealed my conduct and disgraced my office.

KING: His corruption is stunning in its scope and in its sheer audacity, $2.4 million in bribes, at least, private jets for resort getaways, a California mansion, a Rolls Royce, a lifestyle well beyond his means and a thirst for more. That appetite, long-time friends like Charles Nesby say perhaps born of one of the same traits that made Duke Cunningham a successful ace, cockiness. CAPT. CHARLES NESBY, CUNNINGHAM FRIEND: That's the nature of the beast in all of us that are fighter pilots. You're naturally aggressive.

KING: Naked avarice is what prosecutors call it. And look at this. Cunningham actually scribbled this bribe menu on his congressional notepad. Want a $16 million contract. The cost is a boat, BT for short, worth $140,000. Add in another 50,000 for each additional million dollars in contracts.

NORMAN ORNSTEIN, AMERICAN ENTERPRISE INSTITUTE: What Cunningham did is breath taking.

KING: Norman Ornstein has been studying Congress for 30 years and says there has been nothing like this before.

ORNSTEIN: This is somebody who set out to live a lavish lifestyle by making sure he could shake down contractors, lobbyists and interest groups.

KING: Thousands of dollars in meals at the Capitol Grille and other pricey Washington restaurants. Cunningham's tab picked up by defense contractors. Private jets, again paid for by contractors to whisk the congressman around the country. The trendy Delano Hotel on Miami's South Beach was one destination two years ago, $1254 for the room, $848 for Cunningham's meals at the hotel, nearly $13,000 for the chartered jet.

Cunningham grew to expect luxury, the prosecution memo says. His co-conspirators eagerly plied him with it. He was, after all, on the House Appropriations Committee, a leading voice on its defense subcommittee, able to insert multimillion dollar favors into the Pentagon and other budgets. His Navy days gave him standing on military matters and stories worthy of the big screen.

CUNNINGHAM: I met my wife by singing "You Lost That Loving Feeling" to her at (INAUDIBLE) officer's club.

KING: Perhaps they should have raised questions, some friends say, when a congressman with a $165,000 a year salary bought a penthouse condominium here just outside Washington, in addition to the pricey home he owned in southern California.

The condo came courtesy of a defense contractor's $200,000 down payment. Inside, tens of thousands of dollars worth of antiques the congressman demanded in exchange for favors, all now in a warehouse awaiting government auction.

This is the boat from the bribe menu, "The Dukester," a flashy exhibit of Cunningham's life style. Real estate records like these, the more mundane evidence that would begin his fall from grace.

November, 2003, Cunningham sold his home in Delmar to a defense contractor for nearly $1.7 million. The contractor lost $700,000 when he resold it. That caught the eye of a Copley News Service reporter and then that caught the eye of the Feds. What they found is eye popping.

NESBY: It's a power and then some people handle the power correctly. Other people, the power can be misused. Duke lost his moral compass.

KING: Nesby is one of 40 Cunningham friends and family members who wrote the judge appealing for leniency. In his letter, Nesby recalled a white naval officer who took a risk standing up for a young black pilot.

NESBY: It was not popular for him to do that, but I appreciated it. What he did, he leveled the playing field and allowed me to compete and gave me what I deserve and I'll always love him for that.

KING: In his note to the judge, Cunningham wrote, it all started very slowly and innocently, that he's sorry, worried about dying in prison but I will accept your sentence without complaints.

KING: A career that is the stuff of Hollywood, then...

CUNNINGHAM: In my life, I have had great joy and great sorrow. And now I know great shame.

KING: And now.

John King, CNN, Washington.

(END VIDEOTAPE)

PHILLIPS: Well, Duke Cunningham has admitted he could be bought. But one thing's for sure, he didn't come cheap. Let's lay out some of the loot for you. Up for grabs in today's government auction are marble-topped night stands, armoires and sideboards. Plus these blue vases, almost a dozen rugs and a leather sofa. And don't forget the ornamental elephant and other carvings.

This is what it sounded like when they sold a set of candelabra.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Fifteen hundred. The more you pay, the more you're worth. Seventeen -- we have $1,800, 19, $1900, now two, $2,000 bid. Now you get both of them.

(END VIDEO CLIP)

PHILLIPS: You can see the stuff isn't cheap. We're thousands and thousands of dollars.

Our congressional correspondent Ed Henry, well, he doesn't come cheaply either. This live shot is costing us a fortune, but that's a whole other story.

So Ed, do we know anything about these goods? Do we know the story behind the elephant, where it came from, or the vase? Or have you been able to work any intel? ED HENRY, CNN CONGRESSIONAL CORRESPONDENT: Well, in general, Mitchell Wade, one of the contractors who's gotten caught up in this case, gave about $1 million of the $2.4 million in bribes to Duke Cunningham. And Mitchell Wade provided some of these furnishings that you're seeing. In other cases, Wade and other contractors gave Cunningham cash and he picked them out himself.

As you heard John King report there, there's an actual bribe menu, as John noted, and Duke Cunningham wanted $140,000 from these contractors for basically a $16 million defense contract. And each million dollars more in the contract, he would get another $50,000, either in furnishings or cash. He had a yacht. He had a Rolls Royce.

And what's really interesting, when you look through these furnishings, some of them, is the sort of the refined taste of this military man. He had been the stuff of legend, as John was reporting. And such a spectacular fall.

And now you go through it and you mention, the candelabras just sold for about $2,000. There was an ice stand -- whatever that is -- that sold for $500. Another ice stand sold for $650. Persian rugs. There's a French commode that has gotten a lot of laughter. A cedar- lined lingerie cabinet also on the block. The proceeds are going to end up going to the U.S. Treasury Department, the IRS, some of the federal agencies that were investigating this, so that they can recoup some of this money and it will go back to taxpayers -- Kyra.

PHILLIPS: Unbelievable, his taste. I mean, I don't know about you, but the military men that I know, they're not picking out any sort of French commode, that's for darn sure.

HENRY: Yes, that's right. I mean, it's remarkable. And when you look ahead, obviously, a somewhat comical end to a tragic story, to hear that auctioneer auctioning this off. But you can bet the Democrats are going to turn this into an election year issue. Not just about Cunningham. They're trying to broaden it out, say that there's a Republican culture of corruption. It's something that is still a little early as to whether it's really going to resonate with voters -- Kyra.

PHILLIPS: Now, what is this I'm reading about a Katherine Harris connection?

HENRY: Well, she also received campaign money from some of the contractors involved here, and that's tripped her up a bit in her Senate campaign down in Florida. In fairness to her, she has not -- there have been no allegations that she received any bribes or anything like Cunningham did, clearly, that he's already pleaded guilty to and he's already in jail for. The longest prison term, we're told, for any Congressman ever caught up in a corruption case.

But Harris, Katherine Harris, it's just tainted her a bit that she's been dragged into this case at all. And she's having a lot of trouble down there, as you know. Now she's basically staked $10 million of her own money to pour into this Senate race in an effort to try to resuscitate that campaign. The polls showing that she's down. And clearly, just having any sort of tie to this case has been difficult for her politically -- Kyra.

PHILLIPS: So, Ed, have any of your sources said to you, believe me, Cunningham isn't the only one that's going to go down. There are a lot of others that are out in Washington doing the same thing, collecting the same gifts?

HENRY: Some people do it on the record. Like Senator John McCain, just a couple weeks ago, told me, when I asked what's going on, on lobbying reform -- we heard so much about legislation and a stampede to reform the system and we're not really seeing the legislation come up. And McCain said stand by, there are going to be other indictments, other shoes to drop.

And I suspect he's right, not just the Cunningham case, but let's not forget there's a Jack Abramoff lobbying scandal. It's gotten quiet, but Jack Abramoff is cooperating with prosecutors at the Justice Department. We have not heard the last of either one of these cases -- Kyra.

Well, reunited and it feels so good. A Pennsylvania woman is home for the first time since she vanished ten years ago.

And where is Natalee Holloway? Police in Aruba say they have a new witness, new information and a renewed determination to find her. Details when LIVE FROM continues.

(COMMERCIAL BREAK)

PHILLIPS: Unfolding this hour, fresh details of a rescue mission in Iraq. Coalition forces burst into a home near Baghdad to find three surviving colleagues of murdered American hostage Tom Fox. The Christian peace activists were by themselves, their captors gone.

Joining me on the phone right now, Edward Loney, the brother of one of those released hostages, James Loney.

Ed, you and I have talked a number of times about your brother. You must be just elated.

EDWARD LONEY, BROTHER OF FREED HOSTAGE JAMES LONEY: Yes, I'm ecstatic. I'm so happy for Jim and for his colleagues to be found and released.

PHILLIPS: When did you get the word, Jim?

LONEY: Ed.

PHILLIPS: I mean Ed. I'm sorry, I'm thinking of your brother Jim.

LONEY: I know, I know.

PHILLIPS: It's all -- I'm looking at the videotape of him. When did you get the call?

LONEY: It was about midnight our time here on the west coast. PHILLIPS: Wow.

LONEY: After an hour's sleep. And I've been going ever since.

PHILLIPS: I can just imagine. So who called you?

LONEY: My dad called, actually, and said he had some great news, and told me that James had been found and he was on his way home. At first, I didn't believe it. It sounded like a dream and I thought maybe -- you know, maybe this was a joke or something. And then my dad said, no, no. I spoke with him. We talked to him on the phone. And I was like, great. This is, fabulous. Fantastic. And then my wife and I hugged and we had a little cheer and it was great. And we are so happy that this has all been resolved.

PHILLIPS: Well, Ed did you get to talk to Jim?

LONEY: I did. I had the fortune to chat with him about two and a half hours ago.

PHILLIPS: What did you ask him? What did he tell you? Give me all the details.

LONEY: Well, at first he called me and I didn't recognize his voice at first because it was crackling, and calling from Baghdad. And he said he's sitting down, having a lovely chicken dinner with potatoes and nice soup and I was like great, that's great.

He told me about, you know, being rescued and seeing the light of day and, you know, smelling the outside air and he asked how we were all doing, of course, which I was surprised in a certain sense but then I thought, well, of course, the first people he's worried about are us, not him. And so we chatted and we told him that we missed him at Christmastime and we wanted him to come home as quick as he could.

PHILLIPS: Well, I'm sure you didn't have a lot of time to get into all the details because there's probably so much to talk about.

LONEY: Yes.

PHILLIPS: But did you get a chance to ask him anything about what it was like, how did he survive, how did he find his strength, how did he find the motivation, just to keep -- just to not give up faith?

LONEY: Yes, we didn't really get into any sort of heavy topics. I was more interested in just making him laugh, and letting him know that we were all OK. And he started to tell me some stories but, unfortunately, just -- he was starting.

Our conversation got cut out so I didn't have a chance to have any real, meaningful chit chat with him, unfortunately. But that's all right. I mean, I've waited four months. I can wait another couple of days. That's not a big deal.

PHILLIPS: Wow. Do you know if he saw any of the interviews that you've done, pleading to the captors or talking to us on CNN? Did he see any of that coverage or was he completely cut off from the outside world?

LONEY: I get the sense that he was pretty cut off from the outside world. He was talking to my sister who lives in Sault Sainte Marie, Ontario, and they were chatting back and forth and her children mentioned that they see their uncle Ed on television, and Jim heard that and he said, well, what's Ed doing on TV?

And my sister had to explain to him what was going on. He had no idea. He just -- he couldn't understand that. He couldn't comprehend the fact that we've been -- you know that so many people had come out and supported him and now I think he's sort of getting a sense of how many people sit behind him and the work that he was doing in Iraq.

PHILLIPS: Wow. What did he tell you about the rescue, Ed? Are there any details you can tell me about what he heard or was he frightened? Did he -- when did he realize these were the good guys coming in?

LONEY: I think he seemed to realize it pretty much straightaway that it was the good guys that were coming to get him. He said the door was kicked in and a bunch of fine British gentlemen walked in and basically unshackled him and they walked away.

But he didn't get into any details. I didn't really want to know because -- you know, it clutters my mind and I'm more likely to say things that I shouldn't say probably.

PHILLIPS: Well, I know, and you know I have to ask the questions, right, Ed?

LONEY: Yes, oh no. I appreciate that, yes, everyone want to know, so do I.

PHILLIPS: Well, of course, everyone wants to know the back story. And one of the things that's come up, the issue of negotiations. When we had talked in the past, you told me that the Canadian government was keeping you pretty well-informed, if I remember correctly.

Do you know anything about what led to this rescue? Do you know if there had been any conversations between members of your government with the -- with those that were holding your brother captive?

LONEY: No, we don't know any details like that. We really -- the whole time honestly everything we've known, the media's known as well. It's been pretty quiet in terms of communication, as far as we understand.

PHILLIPS: Did your brother mention anything about how he was treated? You know, physically is he OK now? Did he talk about what happened to him physically? Did he talk about how -- what he was able to eat, how he was treated, any conversations with his captors?

LONEY: Well, he said that he was well taken care of. You know, he was always warm and he was always fed, and things like that. And he was never really -- he was more worried about boredom and, you know, the drudgery of every day, not having anything to do because my brother is a very active person.

He -- you know, he needs to be physically active, he needs to be mentally active, in order to really get a full, you know, workout in his life, so I think to be held captive in that sense, just -- you know, just having these boundaries put on what he can do and what he can say was grueling enough. I think that was probably the worst part of it, as far as I can understand from what he said.

PHILLIPS: Well, Ed, I have to tell you, I'm so glad this day has come and we're talking about your brother, alive and well and on his way home. And I hope that the next time we talk, it will be with you, your brother, the rest of your family, and with Jim. We'd love to have you all on.

LONEY: It would be great to have a little chit chat and you can ask Jim all those hard questions and he can let you know how his personality -- how he just shines as a human being. He's an incredible person. And hopefully now that all these people kind of know what he looks like, maybe he'll be able to garner that and use it for his work, you know.

PHILLIPS: Well, he went there as a missionary and to talk about the power of God. I think that what happened here is a prime example of everything he's preaching, Ed.

LONEY: Yes, and it goes to show you that there's a lot of good people in this world who really want the best that they can do.

PHILLIPS: Ed Loney, I can't wait to talk to you and the whole family.

LONEY: Thanks, Kyra, it was great chatting with you.

PHILLIPS: It was great talking to you. Thanks for calling in, Ed.

LONEY: Thank you.

PHILLIPS: We expect to learn more about how the hostages were rescued at the top of the hour. Defense Secretary Donald Rumsfeld will brief reporters and, of course, CNN will be there live. That's at 2:00 p.m. Eastern.

Another developing story that we're following, fire aboard the Star Princess in the Caribbean. Carol Lin working that story for us in the newsroom. New details, Carol?

LIN: That's right, Kyra. According to the president of the Jamaica Hotel and Tourist Association, you're not going to believe this, but they believe that that huge fire was started by someone smoking a cigarette on their cabin balcony.

Take a look at some of the video we're getting in. You see the amount of damage. And it's not 100 cabins, as we first thought, it's 150 cabins, according to the Associated Press. That fire breaking out at about 3:00 in the morning. They got on the loudspeaker, to warn all the passengers to -- that there was a fire and that they needed to evacuate according to plan.

But someone did die of a heart attack during that evacuation. And about 11 people suffered smoke inhalation, a handful of them very seriously. So, Kyra, this is what's the damage one cigarette can do.

PHILLIPS: Unbelievable. All right, Carol Lin, thanks.

LIN: Sure.

PHILLIPS: The news keeps coming. We'll keep bringing it to you. More LIVE FROM next.

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