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Sniper Take Stand Against Partner; Rival Factions War in Gaza; FBI Investigating Public Corruption; Iraqi Soldiers Get On the Job Training

Aired May 23, 2006 - 13:00   ET

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


KYRA PHILLIPS, HOST: Face to face, two snipers together in the same room. This time one's a witness for the prosecution.
Getting out in a hurry. New Orleans tries its new evacuation plans with little over a week to go until hurricane season.

And this desperate redhead suffers like many of you do. Now she helps migraine patients find relief. Oh, and we will ask her about that nail-biting "Housewives" finale, too.

Hello, everyone. I'm Kyra Phillips.

One sniper turns against another. A courtroom drama in Maryland 3 1/2 years after a series of shootings that terrorized millions of people. CNN's Kathleen Koch was in the court -- or courtroom, rather, when Lee Boyd Malvo took the stand today as a witness for the prosecution of John Allen Muhammad. Tell us about those moments.

KATHLEEN KOCH, CNN CORRESPONDENT: Very dramatic when Lee Boyd Malvo came into the courtroom, the first time these two men have been face to face since Muhammad was on trial in Virginia back in October of 2003.

First Lee Boyd Malvo talked to the judge and said, yes, that he had an intention of pleading guilty to the six murders with which -- for which these two men are charged here in Montgomery County, Maryland.

And, then he launched into a chilling description of the murders as they committed them. And made a very dramatic pronouncement about what their initial plans had been.

Initially, he said the two men planned to simply terrorize this entire area, conduct six murders a day for an entire month. And then after that, they would move on to a phase two, where they used improvised explosives packed with ball bearings and nails. And then they would hit schools, school buses, children's hospitals in order to just create maximum damage.

As he went through these -- these murders today, he described how they scouted locations. He made sure there was no surveillance cameras, very few witnesses, a quick escape route. And he said each and every time it was Muhammad who pulled the trigger. He would tell him, quote, "I told him he had to go, and he took the shot."

It was chilling in the courtroom today, Kyra.

PHILLIPS: Were victims' families in the courtroom, as well?

KOCH: They were. And it was very painful to see them sit through this, this very cool, calm, methodical plan of how their loved ones were murdered. And tears were rolling down their cheeks. You could hear them sniffling in the courtroom.

And at one point the family of Perm (ph) Walker, the taxi driver who was the third victim killed, one of them just disintegrated into tears. And Malvo continued testifying. But he slowed down as the crying woman was taken out of the courtroom. And he did have some difficulty continuing his, again, his very clear and precise description of how each person was killed.

PHILLIPS: Kathleen, what about the chemistry between Muhammad and Malvo? Obviously, it was a volatile relationship from the start.

KOCH: In the courtroom when he first came in, John Allen Muhammad really did stare very intently at Malvo, and Malvo didn't look at him.

Now, as he was testifying Malvo really directed his comments to the prosecuting attorney. And Kate Winfrey, who's really not looked at Muhammad much. Muhammad has watched very intently, watching Malvo every second, often with his hands on his chin staring at him.

And Malvo described how Muhammad was the father he never had. How he really didn't have a loving relationship with his own father. How he told Muhammad that he loved him. Muhammad told him that he loved him, as well. And he told the prosecutor, quote, "I absorbed everything he taught. I trusted him. And I believed him" -- Kyra.

PHILLIPS: Kathleen Koch, continue to follow up with you today. Thank you so much.

Well, could be another bad hurricane season. Is New Orleans ready? The next two days could tell us, New Orleans and Baton Rouge, as they hold a two-day evacuation drill just ahead of a mock Category Three disaster.

This is what everybody wants to avoid, the confusion, misery and utter chaos witnessed by the world after Hurricane Katrina.

Some of the searing images from Katrina were the pets abandoned, deserted, neglected, often by necessity. That prompted action in Congress, and the House of Representatives has now passed a bill requiring states and cities to consider pets when they make evacuation plans. If they don't they wouldn't qualify for FEMA grants.

A lot of Katrina victims refused to leave their homes when they couldn't take their pets with them. And estimated 600,000 animals died or were left without shelter.

The stakes are high, but expectations are pretty low. Americans and Israelis alike are downplaying the likelihood of drama or breakthroughs as Israeli Prime Minister Ehud Olmert visits the U.S.

It's his first trip here since he was elected to replace an ailing Ariel Sharon, and two pressing issues will likely come up when Olmert sits down with President Bush today: Iran's alleged nuclear threat and stalled Mideast peace process.

Olmert has already vowed to define Israel's permanent borders in the next four years, with or without Palestinian talks. Many European and Arab allies are opposed to unilateral action, and Mr. Bush is expected to urge a more moderate approach.

That meeting due to take place around 3 p.m. Eastern. We're going to keep in the loop.

Well, many people wonder how peace can exist between Israelis and Palestinians when there's no peace among Palestinians. In Gaza, forces loyal to President Mahmoud Abbas are facing off with a pro- Hamas militia.

CNN's John Vause has the latest.

(BEGIN VIDEOTAPE)

JOHN VAUSE, CNN CORRESPONDENT: This is one of the main intersections in Gaza city. These men are loyal to the Palestinian Authority president, Mahmoud Abbas. They are the regular police service here in the Gaza Strip.

Now, just across the road a member of the new Hamas militia in the trademark camouflage trousers and also the black T-shirt. It is like this throughout the Gaza Strip: thousands of heavily armed men facing off amid escalating tension.

Occasionally, that tension erupts in gunfire like it did on Monday. Caught and killed in that crossfire, a member of the Jordanian embassy, a driver for the Jordanian ambassador here. His body has now been taken back to Israel for the return to Jordan, where the government there is demanding an official investigation.

Overnight Egyptian officials held urgent talks between both sides to try and defuse this crisis, but so far they've had little success. Palestinian Authority President Mahmoud Abbas will meet with the Hamas prime minister, Ismail Haniyeh, on Thursday. But there are fears if those talks fail, Gaza will move closer to civil war.

John Vause, CNN, Gaza City.

(END VIDEOTAPE)

PHILLIPS: Air Force General Michael Hayden could take a big step closer to the CIA this afternoon. The Senate Intelligence Committee is expected to confirm his nomination for CIA director in a closed- door session. The Bush administration hopes for a vote in the full Senate right before Memorial Day.

Talk about your border crossings. Mexican President Vicente Fox is due to arrive shortly in Utah. He's also visiting Washington state and California this week.

The trip comes amid a heated immigration reform battle across the U.S. Utah's biggest minority group is Hispanic, but there's growing frustration over illegal immigrants coming into the state. The Minutemen Project, which wants to get tougher on illegal immigrants, plans protests during Fox's visit.

Well, the issue is still front and center on Capitol Hill, where debate has resumed on immigration reform bill. That measure still has its critics, but even they acknowledge it's on track for passage this week. The bill would toughen the borders but also provide an eventual chance at citizenship for most of the illegal immigrants already in the U.S. It would still have to be reconciled with a much tougher House bill.

And we're waiting for the White House briefing this afternoon. As soon as Tony Snow steps up to the podium, we'll take it live.

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

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(BEGIN VIDEO CLIP)

LLOYD BENTSEN (D), FORMER VICE PRESIDENTIAL CANDIDATE: Senator, I served with Jack Kennedy. I knew Jack Kennedy. Jack Kennedy was a friend of mine. Senator, you're no Jack Kennedy.

(END VIDEO CLIP)

PHILLIPS: Who could forget that line? Well, today we're remembering the man who uttered it. Lloyd Bensten has died at his home in Houston. He was 85 years old. The 1988 Democratic vice presidential nominee delivered the Jack Kennedy quip in a debate with Dan Quayle. Bensten also served as President Clinton's first treasury secretary and as Texas congressman and senator. He had been in poor health since a stroke in 1999.

A public stand against public corruption. The FBI is investigating hundreds of public servants suspected of being on the take, most prominently, Louisiana Congressman William Jefferson. Here's our justice correspondent, Kelli Arena.

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KELLI ARENA, CNN CORRESPONDENT (voice-over): FBI agents are examining materials they collected over the weekend from Congressman William Jefferson's Capitol Hill office. Their search lasted nearly 18 hours. Jefferson, a Louisiana Democrat, is under investigation for bribery. He denies any wrong doing.

REP. WILLIAM JEFFERSON (D), LOUISIANA: I will simply say to you that there's two sides to this story, and we'll have a chance in the right forum to express our side of it. ARENA: According to newly unsealed court papers federal agents found $90,000 in cash last year in Jefferson's Washington, D.C., home. It was allegedly stashed in a freezer and divided among several food containers. Agents told a judge the money was part of a $100,000 payment made by an FBI informant.

The case is just one of more than 2,000 FBI public corruption investigations that are currently under way.

ROBERT MUELLER, FBI DIRECTOR: Corrupt public officials betray the trust of our society and threaten the foundation of our democracy.

ARENA: Other highly visible cases include the investigation of lobbyist Jack Abramoff and the probe into associates of Congressman Randy Cunningham.

Considering the huge amounts of money in play, government watchdog groups say the temptation for public officials is greater than it's ever been.

BILL HOGAN, CENTER FOR PUBLIC INTEGRITY: The opportunities for corruption on a grand scale, I think, are just sitting there. We have more than $2 billion a year spent on lobbying members of Congress.

ARENA: As part of the FBI's post-9/11 restructuring, more than 200 agents were shifted to public corruption units, an area where it was believed the FBI could have a greater impact.

MUELLER: Public corruption and protecting civil rights are the top criminal priorities for the FBI.

ARENA (on camera): The investment seems to be working. In the last two years Director Mueller says more than 1,000 corrupt government employees have been convicted.

Kelli Arena, CNN, Washington.

(END VIDEOTAPE)

PHILLIPS: She escaped from a machine a hospital just in time to save her daughter from the hands of a killer. How can you resist a TV show with that set-up? We can't. So we're bringing in our own "Desperate Housewife" for the dishy details. Stick around or you know we'll just have to talk about you.

(COMMERCIAL BREAK)

PHILLIPS: Well, the chickens are sick, but it's the people who are getting cooped up in Romania. In the past few days, officials in Bucharest have quarantined at least one street and restricted access in dozens of other areas. This happened after domestic poultry tested positive for a form of bird flu but not necessarily H5N1. There are still no human cases of bird flu reported anywhere in Romania.

We're still waiting on a verdict in the Enron trial. But former Enron founder Ken Lay has even more to worry about. Susan Lisovicz joins us live from the New York Stock Exchange with that story.

Hey, Susan.

SUSAN LISOVICZ, CNN CORRESPONDENT: Hey, Kyra. I think a lot of people don't realize there is a separate trial involving Ken Lay in the very same courtroom with the very same judge. And Ken Lay, again, in court declaring his innocence.

He'll be finishing his testimony today in defense of criminal bank fraud charges. Lay is accused of using $75 million in loans he received from three banks in 1999 to buy stocks, in violation of federal rules forbidding the use of loans in stock and mutual fund sales.

Lay admits to buying stocks with the loans but says he wasn't aware he was breaking the law. Under questioning Lay said he didn't remember having any discussions about the rules, even during the years he spent as a director of several banks.

Closing arguments in the case are expected early this afternoon.

The judge in the case, U.S. district Judge Sim Lake is hearing the case without a jury. He will not release his decision until after the verdict in the main fraud and conspiracy case involving Lay and former Enron chief executive, Jeffrey Skilling. The jury is in the fourth day of deliberations in that case -- Kyra.

PHILLIPS: All right. Back to Ken Lay for minute. We're talking about two high profile trials. Can he afford all these legal fees?

LISOVICZ: Well, that's an excellent question, Kyra, because he hasn't worked for years. He has a very, very expensive legal team. Mike Ramsey is a legend in Houston.

We do know that Ken Lay is asking that a $1.1 million donation he made before Enron's collapse be returned to him to help cover those expenses. Lay donated the money to his alma mater, the University of Missouri, to establish a chair in economics.

After Hurricane Katrina hit the Gulf Coast last year he requested that the unspent money go to relief efforts. The university not only turned down that request, it also turned down the request to return the money to his legal fund more than seven years after the original donation.

The Ken Lay chair in economics at the University of Missouri remains vacant. Of course, it's deeply ironic, of course, because Enron collapsed in a wave of questionable accounting, to say the least -- Kyra.

PHILLIPS: Well, we're on stand by with you to when we get more from the courtroom there. Meanwhile, how are the numbers on Wall Street?

(STOCK REPORT)

PHILLIPS: That's a good tease. All right. We'll be listening. Susan, thanks.

LISOVICZ: You're welcome.

PHILLIPS: Ready or not, nervous Iraqi troops experience their first air assault. On-the-job training on the battlefield, straight ahead right here on LIVE FROM.

(COMMERCIAL BREAK)

PHILLIPS: Tony Harris, what are you working on for us in Miami?

TONY HARRIS, CNN ANCHOR: Kyra, good to see you.

PHILLIPS: Good to see you, too.

HARRIS: Just keeping an eye on a brush fire, just another brush fire. Seems like we've been talking about brush fires for the last couple of months now. This is in Miami. Let's go to these live pictures. And our thanks to our Miami affiliate, WSVN, with the pictures here.

No structures appear to be at risk right now, but this could clearly burn for awhile. Doesn't look like that's going to happen, though. Firefighters are on the scene getting at it, knocking it back, knocking it down. The white smoke, obviously, a pretty good sign that they're getting the upper hand on this thing.

We understand that there is an air rescue helicopter on the way to make some water drops. The Florida Turnpike is closed, but right now all lanes open, clean and green for the moment. But that smoke could blow over to some of the lanes of the highway and that might force some closures. But we'll keep an eye on it for you, Kyra.

PHILLIPS: Good deal. Thanks, Tony.

And just as you were updating us on that I'm being told that we just got new sound in from Tony Snow at the White House, reporters questioning him about the investigation into Congressman William Jefferson and those allegations of bribery. This is what he just said.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Tony, how does the president react to concerns from Republican leaders like Speaker Dennis Hastert, put out a very strong statement last night, saying he has deep concern that the raid on Congressman Jefferson's office could basically be an abuse of executive power?

TONY SNOW, WHITE HOUSE PRESS SECRETARY: Well, as I said earlier, we are certainly -- we are hoping that there's a way to balance the constitutional concerns of the House of Representatives with the law enforcement obligations of the executive branch. Those are two things that are in play here. And obviously we're taking note of Speaker Hastert's statements. UNIDENTIFIED MALE: That balance, why were you not trying to strike that balance before you raided the office? Can you really strike a balance after you've...

SNOW: We -- I did not raid the office.

UNIDENTIFIED MALE: You personally did not.

SNOW: The president did not raid the office. And so...

UNIDENTIFIED MALE: Justice Department raided...

SNOW: The Justice Department executed search warrants. I think using the term raid makes it sound a little like did the cavalry's storming into the halls of Congress.

UNIDENTIFIED MALE: The speaker's chief of staff called the Justice Department, and various reports say was basically yelling at them. And Republican officials...

SNOW: Let me just say that the Justice Department -- and I would refer a lot of this back to the Justice Department. The Justice Department has been speaking with the speaker's office and leaders in the House of Representatives. And let me just say, again, we are hoping for a resolution that will balance the concerns of Congress with the obligations of the executive branch.

UNIDENTIFIED MALE: Just final thing. Why wasn't those conversations you say that are taking place in negotiation, why did they not take place before they visited Congressman Jefferson's house?

SNOW: Well, it was -- they were executing a search warrant. My understanding is that there were conversations that went on between the Justice Department and the legal authorities in the House of Representatives. So again, I'm going to have to redirect you there, because they're the ones who are involved in whatever conversations took place before the fact -- Wendell.

(END VIDEOTAPE)

PHILLIPS: Bombers and gunmen out in force in Iraq today. A string of attacks has killed at least 18 people and wounded more than 30 others. Ten of the dead were in car bombings in two Baghdad neighborhoods. The mayhem elsewhere came from roadside bombings and a string of shootings.

On-the-job training at the office, maybe but on the battlefield? Case in point, Iraqi soldiers learning what air assault is all about. Their teachers, U.S. troops. Their school, a real battlefield.

CNN's Arwa Damon reports.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: All right. Let's go ahead and get the first group over there. ARWA DAMON, CNN CORRESPONDENT (voice-over): This is the last rehearsal for these Iraqi army troops. The mission is in minutes.

UNIDENTIFIED MALE: You guys in?

UNIDENTIFIED MALE: We're in.

UNIDENTIFIED MALE: You ready to get out?

UNIDENTIFIED MALE: We're ready to bounce.

LT. ADAM GREGORY, U.S. ARMY: It's like being a teacher anywhere else. You get to see the, you know, the effects of your work as they get better.

DAMON: But test time is over. This is not only their first air assault. It's the first time these men have been up in a helicopter. The Iraqi army doesn't have machines like these, and it shows. The mission: to capture a suspected insurgent.

GREGORY: We're going to move to the next one. Go to the next one right.

DAMON: This is the real thing: learning as they go, instructed by 22-year-old Lieutenant Adam Gregory, himself on his first tour to Iraq.

GREGORY: OK. Take this and -- no. These. We're going to consolidate them in one courtyard, and then we're going sort them out to see if we got our man. Tell him to give the instructions. OK? I'm just to stay here seated, hands out in front of them on their laps. I want them to give the instructions.

DAMON: To the Iraqi army, it's clear instructions at every step.

GREGORY: They can go back to doing what they were doing.

DAMON (on camera): They are now waiting for nightfall to maintain the element of surprise while they continue their search.

(voice-over) Pushing through fields and farmlands, continuing their round-up.

GREGORY: Tell them to put them on their knees. Search complete of the target houses. We are a dry hole once again. And we can be extracted.

DAMON: They'll keep looking for their man. In the meantime, these Iraqi soldiers have conducted their first air assault.

GREGORY: Part of the reason we're out here is so they can get a practice and one day they can do this on their own. And you know, if that's all we get accomplished here, then that's a success.

DAMON: For now the Americans provide the instruction and the helicopters. Arwa Damon, CNN, Kirkuk, Iraq.

(END VIDEOTAPE)

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