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American Morning
Breaking News: Hostage Standoff Ends in California; Levee Land Grab; Hamas Claims Victory in Palestinian Elections; Controversial Kanye
Aired January 26, 2006 - 06:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
SOLEDAD O'BRIEN, CNN ANCHOR: Morning. Welcome, everybody. I'm Soledad O'Brien.
MILES O'BRIEN, CNN ANCHOR: And I'm Miles O'Brien. Good morning to you.
A stunning turn of events in the Middle East, Palestinians choose Hamas, a political party that would like to see Israel wiped off the map. Is it a dead end on the road map to peace? We're live in the West Bank.
S. O'BRIEN: And it's now one hostage held captive inside a California bank. SWAT team is on the scene. We're going to take you there live for the very latest on this developing story.
And why would this woman, take a look, why would she travel with her kids in the trunk of her car? The cops pulled her over. Will she serve any time in jail?
M. O'BRIEN: And Jesus Kanye? The rapper gets wrapped for wearing a crown of thorns on the cover of the "Rolling Stone." He may want to buy five copies for his mother, but you may be outraged.
And haven't we seen enough already? Apparently they have finally come to their senses in the U.K. and that kitty-playing, leotard- wearing Member of Parliament is sent packing at last.
S. O'BRIEN: Lots to get to this morning. We begin with that stunning turn of events for peace in the Middle East. A group on the U.S. list of terrorists, Hamas, is going to run the next Palestinian government. Hamas appears to have won a majority in Wednesday's elections. Any chance of peace talks in the near future, at this point, is not seeming likely.
Let's get right to John Vause. He's live for us in front of the Election Commission in Ramallah, which is on the West Bank.
John, good morning. Give us a sense of what's happened here peace talks wise.
JOHN VAUSE, CNN CORRESPONDENT: Well, Soledad, of course Israel and Hamas are true to their word and the peace process from this point on goes into the deep freeze. Israel has already said today that it cannot trust a Palestinian leadership in which Hamas plays a role. The Hamas officials down in Gaza are saying that negotiations with Israel simply are not on the agenda.
All of this against the backdrop of that stunning parliamentary win by Hamas, as many as 80 seats in the 132-seat Parliament. These figures, though, coming from Hamas election observers who were there at counting stations. They say they have won 80 seats, Fatah has won as few as 30 seats. Those numbers have not been confirmed by the Central Election Commission, that is still six hours away.
But already today, the Palestinian Prime Minister, Ahmed Qorei, has resigned and called on the Cabinet to submit their resignation as well -- Soledad.
S. O'BRIEN: So then what happens next, do you think -- John?
VAUSE: Well what we are likely to see on the Israeli side, more unilateral withdrawals from Jewish settlements in the West Bank, an increase in speed on the construction of the West Bank barrier. On the Palestinian side, slightly harder to tell. The big question, though, will Hamas stick to the cease-fire, a 12-month-long cease-fire which its fighters have mostly stuck to. That is a big question today -- Soledad.
S. O'BRIEN: There were some who thought that Hamas should not participate in the election at all, obviously a massive mistake on the part of Fatah.
VAUSE: Well it certainly appears that in hindsight it was a mistake. But really, the Palestinian Authority President, Mahmoud Abbas, had no choice, Palestinians were demanding these elections and there was a great deal of support for Hamas to participate.
And Abbas wanted Hamas to participate in politics, hoping that if Hamas did get into power, not under these circumstances, certainly not receiving this huge mandate, but certainly taking part in government might moderate the group and turn it away from suicide bombings and attacks to mainstream politics. Whether or not that strategy works, we'll know in the weeks, months and years ahead -- Soledad.
S. O'BRIEN: Yes, everyone, I guess, will just watch and wait.
John Vause for us this morning.
John, thank you.
You want to stay with us this morning. We're going to talk live with former Senator George Mitchell, obviously somebody who has been very much in the middle of peace negotiations, knows the players in the Middle East. We'll talk about the implications in this stunning victory, apparently it seems at this early point, by Hamas. That's coming up this morning -- Miles.
M. O'BRIEN: Now to Iraq and what could be good news for U.S. hostage Jill Carroll. The U.S. military releasing five Iraqi women currently held behind bars. You'll recall Jill Carroll's kidnappers are threatening to kill her unless all women held by the U.S. are released. Aneesh Raman is in Baghdad.
Aneesh, this is apparently a coincidence but might help Jill Carroll's plight.
ANEESH RAMAN, CNN INTERNATIONAL CORRESPONDENT: Miles, good morning.
Exactly. The cause, we're told from the U.S. military, is different, it is not in reaction to the demands of those holding Jill Carroll. They say these five Iraqi women being released today in a mass release of some 420 detainees were under review prior to Jill Carroll being abducted. The hope, of course, is that the affects may be the same.
Now these releases are taking place today. Some might go into tomorrow. It still leaves four Iraqi women, we understand, in custody. Their cases are being reviewed.
Those who are holding Jill Carroll, a group called Brigades of Vengeance, last week demanded the release of all Iraqi women. But we have not heard from them, nor any news on the fate of Jill Carroll, especially since that Friday deadline came and went, but again, the release under way today.
We have some video of it. You just see the men being released, but five Iraqi women part of this mass release. And the hope is, of course, that this may go a long way to helping to free Jill Carroll -- Miles.
M. O'BRIEN: Aneesh Raman in Baghdad, thanks much -- Soledad.
S. O'BRIEN: Now let's get the latest on that hostage situation in California. It's been going on for about 13 hours now. One person is still being held inside a bank in Exeter. And Exeter is just about halfway between L.A. and San Francisco.
Peter Viles is in Exeter for us this morning. He's on the phone.
Hey, Peter, what's the latest? Good morning.
PETER VILES, CNN CORRESPONDENT: Good morning, Soledad.
This started about 5:00 last night with a foiled -- excuse me -- a foiled bank robbery and eight hostages were taken at that time. Five of those hostages were released. And about an hour and a half ago, in a real dramatic episode here, the three remaining hostages made a run for it. Two of them managed to escape. The third hostage did not manage to escape. She is still being held.
Now we're told by police here that there is a dialogue. There are negotiations between the sheriff's department here and this guy who tried to rob the bank and has been holding hostages now for going on nine hours here in Exeter, California -- Soledad.
S. O'BRIEN: All right, we'll continue to watch this story with you, Peter, thank you.
Peter Viles joining us by phone.
And ahead in the next hour, we're going to talk with one witness who has been watching the standoff just across the street. We'll get an update from him -- Miles.
M. O'BRIEN: A horrifying crash in Florida leaving seven kids dead and a host of unanswered questions this morning. Seven children killed when a truck rammed their stopped car at high speed. The car stopped behind a school bus in Lake Butler, Florida. That's about 60 miles southwest of Jacksonville.
Police say the driver of the truck never hit the brakes, just slammed into the car, which then rammed the school bus. The car burst into flames. There is almost nothing left of it, as you can see there. The school bus driver and three kids were thrown from the school bus. Neighbors heard the crash and ran to the scene.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: And then I could see there was a little boy laying on his belly and there's a little 4-year-old girl right next to him, you know, crying for her mom.
UNIDENTIFIED FEMALE: And I asked him, you know, are you all right? The little boy laid down on his backpack and I got down there with him. And you know he says I can't move, my shoulder hurts. And I just told him, you know, to lie still until help arrived.
(END VIDEO CLIP)
M. O'BRIEN: All seven kids killed in the car were adopted in the same family, ranging from 20 months to 15 years old. The 15-year-old driving the car illegally, but her actions do not seem to have been a cause in the crash. There are conflicting reports, but at least three kids are in serious condition out of that school bus. The truck driver is slightly injured. Police, of course, want to talk to him. They are testing his blood for alcohol, possibly.
Later on AMERICAN MORNING, we will update the investigation and find out how the school is handling this tragedy. We will talk to the Florida Highway Patrol and the school's superintendent. That's coming up at 8:30 Eastern Time right here on AMERICAN MORNING.
An update now on a story we have followed closely here. In just about two hours, a Maryland woman faces sentencing for driving around with three kids in her trunk.
CNN's Kathleen Koch with details.
(BEGIN VIDEOTAPE)
KATHLEEN KOCH, CNN CORRESPONDENT (on camera): When this incident occurred back in June, everyone wondered what was this mother thinking. And watching the tape doesn't really make it much clearer. It looks like a normal traffic stop on a warm June day. But then 37-year-old Lanora Lucas of Thurmont, Maryland goes to the trunk and out come her 9-year-old son, 3-year-old daughter and an 8-year-old friend. Lucas puts the children in the car and Sergeant Shawn Tyler begins questioning her.
He asks her why she let the kids ride in the trunk? She says they wanted to and she wanted them to think she was cool. Sergeant Tyler discovered all of this because he had seen Lucas put the kids in the trunk in the parking lot of a video store. He followed her and he made the stop.
Perhaps the most stunning exchange of all, he asks what she does for a living? She says, drive a school bus.
Well Lucas was convicted in November of three counts of reckless endangerment. And at this morning's sentencing, she does face up to 15 years in prison, but the prosecutor is seeking probation since Lucas has no prior criminal record and has taken remedial steps, including parenting classes.
Kathleen Koch, CNN, Washington.
(END VIDEOTAPE)
S. O'BRIEN: You shouldn't need parenting classes to know you don't put your kids in the trunk. That's my little soapbox for the day.
Chad Myers, I'm sure you agree.
CHAD MYERS, CNN METEOROLOGIST: I agree.
S. O'BRIEN: Yes.
MYERS: Yes, I concur.
S. O'BRIEN: Seems pretty clear to me, no trunk for the kiddies.
MYERS: It sure is.
S. O'BRIEN: They ride in car seats inside the car.
MYERS: Inside.
S. O'BRIEN: Yes.
MYERS: Yes. I've even seen like seven kids crawling around a car, like all of 2 years old. And I'm thinking to myself, where are the police? I mean you...
S. O'BRIEN: Right, where are the car seats, where are the cops? But you know...
MYERS: Yes.
S. O'BRIEN: But the trunk, have you ever?
MYERS: No.
S. O'BRIEN: No.
Anyway, how is the weather looking?
(WEATHER REPORT)
S. O'BRIEN: All right, Chad, thank you.
MYERS: You're welcome.
S. O'BRIEN: Rap star Kanye West has never been shy. Now his brass style is on display once again. It's kind of in another controversial way. He's on the cover of "Rolling Stone" magazine.
And CNN's Chris Lawrence reports on this from Los Angeles.
(BEGIN VIDEOTAPE)
CHRIS LAWRENCE, CNN CORRESPONDENT (on camera): This issue just hit newsstands in New York and Los Angeles and it's going to be out all over the country tomorrow. The cover of the latest issue of "Rolling Stone," with a caption the passion of Kanye West, wearing a crown of thorns on his head, an obvious play on "The Passion of the Christ," generating a lot of controversy.
Some say Kanye West sees himself as a persecuted artist, especially after last year. He took a lot of flack for criticizing President Bush after Hurricane Katrina. And he took a lot of flack for demanding that hip-hop stop spreading homophobia, while religious groups say it's a cheap ploy to just play on classic religious icons, Christian icons, in order to pump up sales. Controversy is going to sell a lot of copies. Again, this issue of "Rolling Stone" out on Friday.
Chris Lawrence, CNN, Los Angeles.
(END VIDEOTAPE)
S. O'BRIEN: A cheap ploy to sell your CD, that's shocking.
M. O'BRIEN: Imagine that. Now here is some breaking news.
S. O'BRIEN: Gosh, that's a strategy.
M. O'BRIEN: Wow!
S. O'BRIEN: Later this morning, we're going to be talking to noted music journalist Danielle Smith (ph). She's going to be along in our 9:00 hour this morning to talk a little bit more about this story.
M. O'BRIEN: I'm shocked, shocked.
S. O'BRIEN: Yes.
M. O'BRIEN: There's gambling going on here.
S. O'BRIEN: Who would have thought?
M. O'BRIEN: Yes.
All right, coming up, he may be a prince, but he's facing some pretty tough duty. Prince Harry to Iraq? We'll explain.
S. O'BRIEN: Also this morning, Richard Hatch, remember him from "Survivor," charged with cheating on his taxes. Well now a judge has ruled in the case. Is he going win immunity in real life? We'll tell you about that story.
M. O'BRIEN: Yes, "Survivor," jail term.
And later, more antics from Saddam Hussein, while his trial is on hold, he is trying to drag President Bush into court.
That's ahead on AMERICAN MORNING.
(COMMERCIAL BREAK)
S. O'BRIEN: Who?
M. O'BRIEN: We continue our journey down obscure musical trails on AMERICAN MORNING.
S. O'BRIEN: I'm sorry, who is this group?
M. O'BRIEN: No one knows the...
S. O'BRIEN: Franz Ferdinand. Is it just me? Am I disconnected with the pulse of America...
M. O'BRIEN: We are so out of touch.
S. O'BRIEN: ... or has no one heard of this group? No.
M. O'BRIEN: We are so out of touch.
S. O'BRIEN: Pete (ph) hasn't. Bruce (ph) kind of has.
M. O'BRIEN: No one has.
S. O'BRIEN: So I'm not alone.
M. O'BRIEN: Bruce. Thank you, Bruce.
S. O'BRIEN: Kary (ph), too, he's like not a fan.
Anyway, welcome back, everybody. Let's get to some of our top stories this morning. We start overseas.
Good morning -- Carol. CAROL COSTELLO, CNN ANCHOR: Good morning, Soledad. Good morning to all of you.
We start with breaking news out of the Middle East. It's expected to have an impact on peace efforts. The militant Islamic group, Hamas, claiming a major victory in elections for a Palestinian legislative council, 132 seats were at stake. The Fatah-led Palestinian Authority Cabinet says it will resign so Hamas can form the next government. Hamas says it's committed to the destruction of Israel. Israel's top security officials are discussing the apparent Hamas victory as we speak.
President Bush, yet again, defending the government's domestic wiretapping program aimed at stopping terrorists. He says it's vital and it's legal.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I have the authority, both from the Constitution and the Congress, to undertake this vital program. The American people expect me to protect their lives and their civil liberties, and that's exactly what we're doing with this program. I'll continue to reauthorize this program for so long as our country faces a continuing threat from al Qaeda and related groups.
(END VIDEO CLIP)
COSTELLO: Those comments came after he spoke privately to workers at the National Security Agency, the agency that runs the surveillance program.
Defense Secretary Donald Rumsfeld has some words about a study warning the U.S. Army is stretched too thin. He disagrees.
(BEGIN VIDEO CLIP)
DONALD RUMSFELD, DEFENSE SECRETARY: I just can't imagine someone looking at the United States Armed Forces today and suggesting that they are close to breaking. That's just not the case.
(END VIDEO CLIP)
COSTELLO: The study was done for the Pentagon by a military analyst and a former Army officer. Rumsfeld, by the way, said he hasn't read it. The report says the strain on the Army, not the improvement of Iraqi forces, has led the Pentagon to plan the withdrawal of some troops from Iraq this year.
Speaking of Iraq, Britain's Prince Harry could be heading that way. In April, the prince will join the Blues and Royals Regiment of the Household Cavalry as a lieutenant. Or, as they say in Britain, lieutenant. That's after his training at the Sandhurst Military Academy. A Defense Ministry spokesman says if the prince's squadron is sent to Iraq, he probably will go with it. Harry is third in line to the British throne. And in line for a trip to prison, Richard Hatch, the first winner of the CBS reality TV show "Survivor," he has been convicted of tax evasion. A jury in Providence, Rhode Island says he failed to pay taxes on the $1 million he won on "Survivor." He faces between two and four years in prison. Hatch's attorney is a guest in the next hour of AMERICAN MORNING. And I'm sure Soledad will ask him how exactly a person forgets to pay taxes on a million bucks -- Chad.
MYERS: Well he actually thought CBS was going to pay, or at least that's his claim.
COSTELLO: I don't think the jury bought it.
M. O'BRIEN: That's right, tell it to the judge.
MYERS: If you want more, it's the number four story on Most Popular CNN.com. It's all there.
(WEATHER REPORT)
Back to you guys.
S. O'BRIEN: All right, we'll wait for that.
Thanks, Chad.
Well good news, a lot of good news for women in business, actually, to talk about, plus a preview of what's ahead for Wall Street.
Carrie Lee has got our "Financial News Update."
Good morning.
CARRIE LEE, CNN CORRESPONDENT: Thank you. Good morning.
Looking like some green arrows at the 9:30 opening bell for stocks this Thursday morning. This, after we saw a little bit of selling at the close yesterday. Dow, Nasdaq, S&P all fractionally lower.
One piece of economic data yesterday, existing home sales saw another record, the fifth consecutive record for 2005, despite a weak ending to the year. The year ended on a weak note with three straight months of declines, but still, really strong year.
Home prices up nearly 13 percent for the year, and that is the biggest hike since 1979. The National Association of Realtors expects home prices will continue to rise this year, but just 5 to 6 percent. So looking like a pretty soft landing there.
Now, on to women-owned businesses and this is a very encouraging survey here. The number of women-owned businesses grew at twice the national rate for all private companies. From 1997 through 2002, 28 percent of private companies, that's 6.5 million, were owned by women in 2002. And that's up 20 percent from 1997. And take a look here, you can see men still own more businesses, but the number of women- owned businesses growing at a faster pace.
Now a lot of these are single enterprise, with just one employee, owned companies. But so what, it's still an encouraging trend. And this is the type of thing we like to see.
S. O'BRIEN: So it sounds (ph).
LEE: Right -- Soledad?
S. O'BRIEN: Absolutely. Let's hear it for the sisterhood this morning.
M. O'BRIEN: Bring it on.
LEE: There you go.
M. O'BRIEN: Absolutely.
S. O'BRIEN: Miles, too, he's a good feminist.
M. O'BRIEN: Bring it on. Absolutely.
LEE: Right.
S. O'BRIEN: Thanks -- Carrie.
LEE: Right.
S. O'BRIEN: Appreciate it.
LEE: Sure.
S. O'BRIEN: Carol's got a look at "Morning Coffee" this morning, a little preview. What have you got?
COSTELLO: He's back. Author James Frey will be on "Oprah" today to explain, once again, why exactly he made up some of his memories. Will he get a free pass on "Oprah?" That's next in "Morning Coffee."
(COMMERCIAL BREAK)
S. O'BRIEN: That's Franz Ferdinand, that...
M. O'BRIEN: Franz Ferdinand, of course.
S. O'BRIEN: ... famous U.K. band. A minute ago we said we didn't know them, and we didn't know them. But we have Googled them, and apparently they are in the running for six awards at the NME Awards, including best British band and also, apparently, best dressed, too.
M. O'BRIEN: The NME, is that the nummies (ph)? The nummies?
S. O'BRIEN: I don't know.
M. O'BRIEN: Anyway, they are apparently very popular with the kids. So we're getting plugged in now.
COSTELLO: Man, you guys make yourselves sound so old.
S. O'BRIEN: Hi, he did, not me, jeez.
(CROSSTALK)
S. O'BRIEN: I just never heard of them, but they are very good. I'm very impressed.
COSTELLO: Yes.
S. O'BRIEN: And they are cute, too.
Anyway, to "Morning Coffee."
COSTELLO: "Morning Coffee."
S. O'BRIEN: Good morning.
COSTELLO: This will make you steam. Saddam Hussein's antics have thrown his trial into confusion. You know that. Well now he's come up with another tactic, a lawsuit. Yes, he's filed a lawsuit against President Bush and British Prime Minister Tony Blair. He's going to sue. The suit claims the United States and Britain used weapons of mass destruction against unarmed Iraqis, that they tortured prisoners, and, yes, they polluted the air in Iraq. You...
M. O'BRIEN: What about those oil fires after the first Gulf War, that doesn't count? I think he lit those.
COSTELLO: Well that's not in the lawsuit.
M. O'BRIEN: It's not in the suit, OK, omitted.
COSTELLO: No, no, no. He wants our president, President Bush, brought before the International Criminal Court in The Hague. Of course we'll keep you posted.
They say never underestimate the power of Oprah, but some feel she has some explaining to do herself. And maybe we'll get some answers today. James Frey, the guy who wrote "A Million Little Pieces," will be on her show.
Unless you've been living in a cave, Frey's book came under fire over allegations he made up some of his own memoir. But Oprah stood by him, and she did so on Larry King. You remember that. Some wonder why. Was it because she chose Frey's book for her book club and didn't want to admit she was wrong? Should be a spirited debate. Several journalists will be there with their own stories about Frey's story.
S. O'BRIEN: I am so excited for this "Oprah."
M. O'BRIEN: You're watching?
S. O'BRIEN: She's -- yes, she's...
M. O'BRIEN: She's brilliant to bring him on, don't you think? Yes.
S. O'BRIEN: Brilliant. Brilliant. Brilliant. Because you know, not only, first, she had the smoking gun kind of take apart the legal part of his story, his, you know his time in prison that he claimed, blah, blah, blah. Now a lot of people in rehab are saying what he's describing just doesn't happen in these rehab centers. Like the whole thing might be just a complete sham.
COSTELLO: Yes, and maybe she'll change her tune after the show. Who knows? That will be interesting to see what she has to say today.
S. O'BRIEN: I want to see her take him apart...
M. O'BRIEN: Big numbers today, big numbers.
COSTELLO: I don't know, she's been standing by him, so I don't know.
S. O'BRIEN: We'll see. We'll see.
COSTELLO: Now for Chad's favorite story. This is for you, Chad, because now we know why a Member of the British Parliament acted so wacky. George Galloway was voted off Britain's version of "Celebrity Big Brother" last night. Surely you remember his cat impersonation.
Galloway now says he was bored in the "Big Brother" house and that was really why he got so involved in that cat thing. And of course the red leotard thing. Hopefully we'll have a picture of that just for Chad. He actually went on the show to get young voters interested in politics again. So there you have it.
S. O'BRIEN: All right, Carol, thank you very much.
We want to break for some breaking news right now. There's a press conference being held. We've been talking about this hostage situation. Let's listen in. They're updating us on the status.
UNIDENTIFIED MALE: All the hostages got out safe, and the suspect, for that matter, and none of your officers were injured whatsoever at all?
KEITH DOUGLASS, EXETER COUNTY SHERIFF'S DEPT.: It's a great conclusion to a very long incident. You know we just want to thank everybody who was involved, the Exeter Police Department, fine men (ph) of the police department, members of the FBI and of course negotiators from the sheriff's office. We have been working on this thing since a little after 5:00, and we would have been out here for hours if that's what it took. But this is a great ending for everybody involved.
UNIDENTIFIED MALE: How are the hostages doing right now?
DOUGLASS: All the hostages are doing great. And, no, there was no force.
QUESTION: (INAUDIBLE) pack of cigarettes in exchange for...
DOUGLASS: There wasn't an exchange. An opportunity presented itself and the SWAT members were able to retrieve the hostage and the suspect had no more negotiating bargaining tools with.
QUESTION: So help us better understand, you said to the guy, hey, if you come and you want to get some cigarettes through us then we'll give them to you. And then what happened?
DOUGLASS: I can't say exactly what the negotiator said, but basically somebody has got to retrieve the cigarettes from the bank, you know, from the people who have them at the door. The opportunity presented itself and the hostage was retrieved.
QUESTION: And what kind of shape is she in, this hostage?
DOUGLASS: I was sitting over here. I can't answer that. I don't know.
QUESTION: When (ph) did you get the cigarettes?
DOUGLASS: I don't have that information. Well there was only one hostage left.
QUESTION: And these situations don't always turn out like this.
DOUGLASS: No, they don't, and we're very grateful this -- that this situation, given everything to take place, we started off with eight hostages and then all of them been retrieved safely. It's -- we're just really blessed to have that.
QUESTION: Can you tell us anything at all about the suspect?
DOUGLASS: Not yet. I will -- we will relieve all the information we can as soon as we find out who it is. We found out. We were sitting right next door -- we didn't -- when they got him out.
QUESTION: How long were you willing to go until you used possibly something more than use the cigarettes, like tear gas, or something to that effect?
DOUGLASS: We would not have made any form of dynamic entry until all forms of verbal negotiation were completely extinguished.
QUESTION: So the line of communication was open throughout the entire...
DOUGLASS: Very much so.
QUESTION: Can you describe the mood or the demeanor of the suspect at times, was he calm throughout this whole ordeal? Was he desperate at times?
DOUGLASS: He appeared to be calm throughout the entire incident. QUESTION: Clearly we'll learn from the family members that what we saw was right and good (ph) because they are all home safely. Could you give us a sense if that's -- we can't talk to them now while you investigate, what was going through their heads as they got released? We saw from a distance those bodies scattered (ph), but those are harrowing moments. Can you explain that feeling...
DOUGLASS: Very much so, a lot of relief. I actually escorted one of the hostages back into the command post for a debrief. Very visually upset, but very relieved that they were safe, but also a lot of concern for the hostages that were still inside the bank at the time.
QUESTION: What did she say to you?
DOUGLASS: She didn't say anything to me. I didn't question her. I just took her right in the command post.
QUESTION: What's the process now for the hostages and the bank tellers, are they going to be debriefed by your law enforcement agency, by FBI?
DOUGLASS: Probably both. They'll also be debriefed by the Exeter Police Department, who, again, is conducting the criminal investigation into this. They'll get their statements. And then the bank will probably provide some form of counseling for them.
QUESTION: And this suspect originally came in as a demand for money.
DOUGLASS: We're still determining that. I'm going to have to defer that question to the Exeter Police Department as it is an investigation part on their tool.
QUESTION: So you know the rest of the country is going to hear this story. It's going to be the guy who, he ended a hostage crisis because of a pack of cigarettes. (INAUDIBLE) best you can (INAUDIBLE).
M. O'BRIEN, CNN ANCHOR: We've been listening to a sergeant from the Exeter, California, police department. And what he's telling us right now is that essentially that hostage situation, which has been going on overnight, has ended peacefully. Apparently nobody hurt. We're very glad to report that.
I think we have CNN's Peter Viles, who is on the scene right now. Is he joining us? OK, let's go to Peter.
Peter, why don't you recap? Because we sort of came into the middle of that news conference. And just back up a little bit and tell our viewers where we are right now.
VILES: Well, we don't have all of the facts about how this happened, this last hostage rescue, if you will. But it sounds like they tricked the guy. He wanted some cigarettes. They brought cigarettes to the door of the bank and said somebody has got to come out and get these cigarettes. And they haven't told us yet who came out to get the cigarettes, whether the bank robber or the final remaining hostage. It sounds like it was the hostage, but we don't know that for sure.
In any event, she comes to get the cigarettes, or he does, and they grab either one of these people, and the hostage situation is over. Essentially they duped this guy over a pack of cigarettes. But it's a nifty piece of law enforcement work.
The whole standoff here has ended peacefully. No shots were ever fired. We're not aware of anyone who was injured in all of this.
The final hostage is free. And the guy who tried to rob the bank and held these hostages overnight is now in custody -- Miles.
M. O'BRIEN: All right, Peter Viles, thank you very much.
So it ends with everybody safe, the suspect in custody. And, Peter Viles, we'll get back with you a little bit later as the details come in on this situation in Exeter, California, south central -- I'm sorry. What were you saying?
S. O'BRIEN: It sounds as if they were saying that since it ended -- you know, it started with hostages going to five.
M. O'BRIEN: OK.
S. O'BRIEN: And really what a remarkable story.
M. O'BRIEN: OK.
S. O'BRIEN: You could see the relief on the face of Keith Douglass, the sergeant from the sheriff's department.
M. O'BRIEN: You bet.
S. O'BRIEN: Rare that it -- and good that it ended so easily and quickly.
Let's get right to Carol. Other stories to tell you about this morning. We want to get to those.
Good morning.
COSTELLO: Yes, because we are following breaking news out of the Middle East, the Palestinian elections. The Islamic militant group, Hamas, is claiming a landslide win in elections for the Legislative Council. The apparently victory could spell further trouble for the already stalled Middle East peace efforts.
In a couple of minutes, Soledad will speak to a guest in Jerusalem to get some Israeli reaction.
In Iraq, five Iraqi women in U.S. custody are among hundreds of detainees being released today and tomorrow, and that could have an impact on the fate of U.S. journalist Jill Carroll. Militants said last week they would kill the freelance journalist. They would not kill her if all female prisoners in U.S. custody were freed. Carroll was abducted in Baghdad on January 7.
A horrible traffic accident on a northern Florida highway. A truck hits a car from behind, pushing it into a school bus that had stopped to let children out. The car's occupants, seven young people, and most of them related to one another, died in the fiery crash near Gainesville. The car was driven by a 15-year-old girl with a learner's permit. Three of nine children on the bus were seriously hurt.
Former President Gerald Ford is home this morning. He was finally released from a southern California hospital after being treated for pneumonia. The 92-year-old ex-president had been at the Eisenhower Medical Center in Rancho Mirage since January 14.
And Isiah Thomas, the president and general manager of the New York Knicks, was told by his attorney not to respond to a sexual harassment lawsuit. But Thomas is anyway, and he's upset.
(BEGIN VIDEO CLIP)
ISIAH THOMAS, PRESIDENT, NEW YORK KNICKS: I did not harass Anuka (ph). I did not discriminate against her. I did not fire her. I did not participate in any discussion that led to her being fired.
(END VIDEO CLIP)
COSTELLO: Anuka Brown Sanders (ph) filed a lawsuit against Thomas in Madison Square Garden. She's a former senior vice president of marketing and business operations for the Knicks.
And that's a look at headlines this morning.
M. O'BRIEN: All right, let's get the forecast now. Chad Myers with that.
(WEATHER REPORT)
M. O'BRIEN: Lawmakers in Louisiana wanted $30 billion to rebuild all of the destroyed homes left after Hurricane Katrina. The state will get 6 billion instead. The White House announcing its decision yesterday. The administration's plan says it will focus on uninsured homeowners. And after all of the money is gone, the state can ask for more.
Right next door, Mississippi, will get $5 billion. Lawmakers there say they are very happy with that number.
In Dallas, Texas, remember all of the Hurricane Katrina evacuees that went there after the storm? Well, today some of them are worried their time is up. That's because the city housing authority there still hasn't paid their December rent. Housing officials say they've been totally overwhelmed by thousands of applications for housing vouchers. They have fallen behind in the payments. The authority says the payments will be made, and that they're hiring extra staff to speed up the process.
Over the last five months we've heard a lot about how much Gulf Coast residents lost to Katrina. Now, many property owners are finding out that even more sacrifices need to be made to help insure the safety in the future.
Sean Callebs reports from Plaquemines Parish south of New Orleans.
(BEGIN VIDEOTAPE)
SEAN CALLEBS, CNN CORRESPONDENT (voice over): First the hurricane took Ken Ragas' house.
KEN RAGAS, PLAQUEMINES PARISH RESIDENT: Let's see, back to here, that was my house. It was about 2,000 square feet.
CALLEBS: Now the government wants a chunk of his land. This yellow stake marks where the new levee will be and how much land Ragas will lose. But he isn't upset. Ragas is willing to sell the land if it means greater protection from hurricanes in the future.
RAGES: I don't think anybody is ignorant enough to live in a place that's not safe and raise children.
CALLEBS: Plaquemines Parish juts out about 80 miles into the Gulf of Mexico, making it vulnerable to damage from hurricanes. The storm surge from Katrina sent water over the levees.
RAGAS: My house, which was here, went in this direction.
CALLEBS: The house that used to be on this concrete slab was pushed all the way across Highway 11.
RAGAS: Well, I'll tell you, at the -- you know, a lot of people now, even my friends, you know, we just kind of laugh about it, you know, because -- I mean, what are you going to do?
CALLEBS: The U.S. Army Corps of Engineers promises to return levees to pre-Katrina strength by June of this year. Yellow stakes dot Plaquemines Parish, marking the land the government is acquiring. About 230 property owners are affected.
At a community meeting to explain the process, the Corps of Engineers told the residents they would get paid based on land value after damage from Katrina.
UNIDENTIFIED FEMALE: I don't see how you can put fair market value, the word "fair" and "market value" in the same sentence.
CALLEBS: The Corps maintains property value here has not plummeted.
JANET CRUPPI, ARMY CORPS OF ENGINEERS: For the most part on vacant land, we'll see those values be very close. CALLEBS: Federal officials say the government is spending $140 million to upgrade the levee system here. But they couldn't answer the toughest question, just how much homeowners will be paid for their land. But to be clear, the government is taking the land. If residents don't like the offer, authorities say the dispute will be resolved in federal court.
Sean Callebs, CNN, in Plaquemines Parish.
(END VIDEOTAPE)
M. O'BRIEN: Now, the Army Corps of Engineers says about $14.5 million is set aside to compensate parish residents for the property they will lose because of their levee work.
S. O'BRIEN: Ahead this morning, we've got much more on the efforts to save kidnapped American journalist Jill Carroll. This morning we talk to one of her friends, find out if she or if Jill's family has gotten any update on her situation.
M. O'BRIEN: And also, that stunning turn of events in the Middle East. Hamas, a group linked to terror, a group that would like to see Israel wiped off the face of the map, now in control of the Palestinian parliament. What does that mean for peace in the Middle East? Next on AMERICAN MORNING.
(COMMERCIAL BREAK)
S. O'BRIEN: Welcome back, everybody. Let's get right back to the Middle East this morning. It's our top story and really what has become a political earthquake touched off by the Palestinian elections.
The militant group, Hamas, labeled terrorists by the U.S., is now claiming victory. Of course, lots of concern about the peace process.
Joining us this morning is Alvaro DeSoto. He is a special U.N. envoy to the Middle East.
Thank you for talking with us. Certainly appreciate it. I think it's fair to say...
ALVARO DESOTO, SPECIAL U.N. ENVOY TO MIDDLE EAST: My pleasure to be here.
S. O'BRIEN: Thank you. I think it's fair to say stunning developments in this case. Many people predicted Hamas would have a good showing possibly. But to walk away, to a large degree, with the election is stunning, isn't it?
DESOTO: Well, if indeed this is confirmed by the Central Electoral Commission, it does look impressive and surprising. But we shall have to wait and see. We have to note the fact that these were elections for the legislature only.
Another matter is how the executive branch will be composed. And on that it will be up to President Mahmoud Abbas to take the initiative.
S. O'BRIEN: Exactly. Now, as you say, we're still waiting for the sort of official election results to come in. Ahmed Qurie (ph) has stepped down, resigned essentially, and said now Hamas has to create a government and bring it forward. Does this leave a political vacuum right now?
DESOTO: Well, I was not aware of the resignation. I'm sure that someone will be occupying the government as a caretaker until a new government takes over. But I am sure that President Abbas will take the necessary precautions to ensure continuity. We at least, the United Nations in any case, are here to help them out in whatever way we can.
S. O'BRIEN: The United States has said that they will not work with Hamas. We heard it from Scott McClellan. the U.S. spokesperson, the other day. Is that a negotiable position, do you think, considering the results of this election?
DESOTO: Well, I cannot speak for the United States. Let's first see how the government is formed and who is included in the government. I think what's important to bear in mind is that voters take their position on for various reason. Hamas has governed various municipalities, cities, in a way that has been seen as clean and efficient. They are not seen as corrupt. And there is a lot of corruption, which is unfortunately associated with the present government.
However, at the same time the Palestinians have an important yearning for peace. That's the mainstream. The Palestinians want to make peace with Israel, and they want to -- they are prepared to compromise on the understanding that Israel will do the same.
So, Hamas has a past that is condemnable, and they have a covenant, which is from 1988, which is also condemnable. And what we hope is that whatever government emerges, however it is confirmed, it will reflect that wish of the Palestinians to make peace and to do it in accordance with the road map, which means a renunciation of violence as a means to achieve one's ends. It means the acceptance of a two-state solution: Israel and Palestine. It means essentially giving up the arms in a framework of the road map to peace.
S. O'BRIEN: You've sort of listed all of the elements that would have to happen. And while you say Hamas is not perceived as being corrupt, they are certainly by the U.S. perceived as being terrorists. Is it going to be possible to negotiate a peace deal with two groups that clearly don't see eye to eye? I mean, Hamas has called for the destruction of Israel. How do you negotiate a peace treaty between these two groups?
DESOTO: Well, we have to see -- we have to check for signs of evolution. Their covenant is almost 20 years old. And their electoral platform is quite a distance from that covenant, and it doesn't contain a number of those elements.
And perhaps more important than that, in the past several months, before the disengagement from Gaza and parts of the Northwest Bank, and during the disengagement and after the disengagement until now, Hamas has by and large respected a cease-fire. We haven't seen terrorist actions by them.
Now, the important thing is that they be committed to a peaceful solution. So we will have to wait and see.
S. O'BRIEN: I'm sure everyone will have to wait and see. Thank you very much. Appreciate your time. Alvaro DeSoto is a special U.N. envoy to the Middle East.
DESOTO: My pleasure.
S. O'BRIEN: Thanks -- Miles.
M. O'BRIEN: Andy Serwer is here.
Good morning, Andy. Good to have you with us. Enron.
ANDY SERWER, "FORTUNE" MAGAZINE: Yes. Are you ready for the Enron trial, you guys? It starts up on Monday.
S. O'BRIEN: Are you ready?
SERWER: I'm ready. Yes, we're going to be covering it a lot.
M. O'BRIEN: Get ready for some Enron!
SERWER: Already lawyers for Ken Lay and Jeff Skilling seem to be ready to try every trick in the book. More on that. Stay tuned to AMERICAN MORNING.
(COMMERCIAL BREAK)
S. O'BRIEN: Welcome back, everybody. Andy has got business in just a few moments. First, though, Carol has got the headlines.
Good morning again.
COSTELLO: Good morning. Good morning to all of you.
We're following that breaking news out of the Middle East this morning. The Islamist fundamentalist group, Hamas, has claimed a landslide victory in the Palestinian elections. Hamas estimates it has won 80 of the 132 seats in the Legislative Council. The Fatah-led Palestinian Authority cabinet is stepping down so the Hamas party can form a new government. Israel's acting prime minister says he will not negotiate with Hamas. Hamas has said it wants the destruction of Israel.
More breaking news to tell you about, this time out of California. That bank hostage situation has now ended. Just a short time ago, the final hostage was released. Two of the remaining three female hostages escaped just a couple of hours ago.
(BEGIN VIDEO CLIP) DOUGLASS: It's a great conclusion to a very long incident. You know, we just want to thank everybody who was involved, the Exeter Police Department, the Farmersville Police Department, members of the FBI and, of course, the negotiations from the sheriff's office. We had been working on this thing since a little after 5:00, and we would have been out here for hours if that's what it took. But this is a great ending for everybody involved.
(END VIDEO CLIP)
COSTELLO: It is. The standoff began Wednesday when bank employees alerted police that a gunman was demanding money.
In Broward County, Florida, a former doctor working with fake Botox is now facing a prison sentence. Bach Macomb (ph) pleaded guilty in November to working with unapproved pharmaceuticals. He temporarily paralyzed four people, including himself, with shots of a knock-off of the drug Botox. He's been sentenced to three years.
Passengers aboard the Queen Mary II may be missing their flights home. The ship is due in Rio de Janeiro tomorrow morning, and that would be 22 hours behind schedule. The ship cancelled all three port trips on a 12-day New York to Rio cruise because of a broken propeller. Oh, the passengers are angry. In fact, 250 of them plan to sue, and some are refusing to leave until they are taken to those islands, Chad.
MYERS: Yes, that's a pretty big suite that was right there. I'm sure that was a couple of grand.
COSTELLO: Oh, yes.
MYERS: A couple of thousand pounds sterling or whatever they do.
(WEATHER REPORT)
M. O'BRIEN: Enron. Imagine that. They're pulling out all of the stops in this trial.
SERWER: Yes.
M. O'BRIEN: They're going to try to get it moved. Is there a chance that will happen?
SERWER: They're going to try to get it moved, and there's no chance that's going to happen at this point. They've been trying to get this trial moved for a year. You know, it's been almost four years now since Enron collapsed, more than four years in fact. And the trial looks to finally begin on Monday. Jury selection is starting up in just a couple of days.
Meanwhile, lawyers for Jeff Skilling and Ken Lay are trying yet again to get the trial moved out of Houston, saying, of course, they couldn't get a fair trial there. They won't be able to find an untainted jury. Judge Simlake (ph) denied the request. He denied it on Monday. He denied it a year ago. A hundred jurors are expected to show up in court on Monday. Ken Lay has a 20-person legal team. Twenty people on his legal team. And get this: 200 million pages of documents in the trial. And that is just staggering.
M. O'BRIEN: The legal bills, do we know what it's going to be?
SERWER: We don't know, but it will be a lot.
S. O'BRIEN: How much money does he have?
SERWER: He has some money left. I mean, he's paid millions of dollars of fines. But, you know, he's not broke. Of course, he's not revealing his net worth at this point.
Another story we want to talk about, though...
M. O'BRIEN: I thought at one point didn't his wife say they were...
SERWER: No, that was, well, Ken Lay.
M. O'BRIEN: OK, Lay was (INAUDIBLE).
(CROSSTALK)
S. O'BRIEN: Well, he had the big diamond ring.
M. O'BRIEN: Yes, that's right.
SERWER: Right, right, yes.
S. O'BRIEN: (INAUDIBLE), yes.
SERWER: It was kind of difficult.
S. O'BRIEN: That was hard to swallow.
SERWER: I want to talk about the story concerning imminent domain. You know, a very controversial subject. It's been in the news lately. You may remember back in June the Supreme Court ruled the city of New London could take over private property for commercial development. Now one of the nation's largest banks, BB&T, says, it will not loan any money to a construction company working on a project that involves imminent domain. In other words, if the city takes over some property, and a construction company starts to develop it, this bank will not lend that construction company money.
S. O'BRIEN: Well, is it a moral issue, or is it sort of a legal, they could be sued, they could lose, and we could lose our money in the end?
SERWER: It's a moral issue.
M. O'BRIEN: Really? SERWER: The CEO of the bank says it's unfair, it's un-American, and he will have nothing to do with it. BB&T, the nation's ninth largest bank, out of Winston-Salem, North Carolina.
M. O'BRIEN: Interesting.
S. O'BRIEN: That's really interesting.
M. O'BRIEN: Taking a stand there.
SERWER: Yes.
M. O'BRIEN: All right.
S. O'BRIEN: Andy, thank you.
SERWER: You're welcome.
S. O'BRIEN: Ahead this morning, no immunity for Richard Hatch. The first-ever "Survivor" champion is now in jail for cheating on his taxes. We're going to talk to one of his lawyers just ahead this morning.
(COMMERCIAL BREAK)
S. O'BRIEN: Be sure to check out our Web site, CNN.com, for the latest on this morning's top stories. And if you're about to head out the door or go to work or school, you can stay in touch with CNN and AMERICAN MORNING by logging on to CNN.com and our pipeline video service. Catch live commercial-free news updates all day. Go there at CNN.com/pipeline.
And as we approach the top of the hour, let's check on the forecast. Chad has got that for us.
(WEATHER REPORT)
MYERS: The next hour of AMERICAN MORNING starts right now.
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