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Trump CFO Surrenders after Grand Jury Indictments; Bill Cosby Freed from Prison after Conviction Overturned; Biden Departing to Meet with Families in Surfside, Florida. Aired 7-7:30a ET

Aired July 01, 2021 - 07:00   ET

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

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JOHN BERMAN, CNN NEW DAY: Are unsealed.

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ERICA HILL, CNN NEW DAY: Now, these are the first charges in a year's long investigation by prosecutors in New York. At this time, there's no indication Donald Trump or members of his family have been charged.

CNN's Kara Scannell is outside the courthouse in Lower Manhattan with the very latest for us this morning. Kara, good morning.

KARA SCANNELL, CNN REPORTER: Good morning, Erica. Yes, just a few moments ago, Allen Weisselberg, the chief financial officer of the Trump Organization, surrendered to authorities just around the corner from here. He is going to face charges this afternoon in an indictment that's related to tax crimes.

Now, we don't know the detail of the indictment just yet because it will become public later today, but this investigation has been looking into compensation and benefits that he received as a top official at the Trump Organization that includes a rent-free apartment, company cars, bonuses and school tuition for at least one of his grandchildren.

This investigation has been going on for years. It went all the way up to the Supreme Court in the D.A. -- Cy Vance Jr.s' effort to get the former president's tax returns, both his personal returns and his business returns. This is all culminating today with the charges against Allen Weisselberg and the Trump Organization.

As you noted, the former president, Donald Trump, is not expected to be charged nor any members of his family but this investigation remains ongoing and active, sources tell CNN.

The Trump Organization will also have an attorney in court this afternoon. While, they are expected to enter a plea of not guilty to these charges, the big question here will be the breadth of the charges, what exactly are they alleging, how much money is involved, because that goes to how severe the potential penalties can be, particularly for Allen Weisselberg. Now, he has not cooperated at all as part of this investigation. The big question here is also, does that change as this goes forward. I think we'll learn a lot more this afternoon when we have a sense of just how serious these charges are and what penalties he might be facing. Erica?

HILL: And, Kara, any more information this morning from Trump camp?

SCANNELL: You know, we have not heard anything from the Trump camp. And we were expecting them to issue some sort of statement overnight to address the pending charges after they were informed that the company was under indictment. We have not heard any statement. I mean, the former president issued a statement on Monday where he was saying the types of crimes or the practices that are being prosecuted, he called them standard business practices.

So we're expecting a robust defense from them. They have been, I think we believe they are going be arguing that these types of cases are normally handled in a civil matter and this is being criminal. He has said this investigation is politically-motivated, he's called it a witch hunt, I expect we'll hear a lot more this afternoon. Erica?

HILL: As far as we know, this is Allen Weisselberg and the company itself, but there are a lot of questions, obviously, about the former president's children, Eric and Don Jr. still at the company. Is there a sense that they could potentially be named at some point?

SCANNELL: Well, this investigation is ongoing. And as we've been reporting, it is very broad in nature. They have looked into the hush money payments that were made to silence Stormy Daniels who had alleged that she had an affair with former President Donald Trump. It also includes looking into other types of tax treatments, different deductions and expenses that the company has taken, and it includes how they value their properties, whether they misled banks, whether they misled insurance companies and whether they misled tax authorities in those values.

So this all has been under scrutiny. It really narrowed its focus in recent weeks on this issue of compensation and whether the Trump Organization was not reporting income that they were providing to employees, somehow essentially hiding it from the tax authorities, but this might be the first move that we've seen. This investigation is ongoing.

What also sometimes happens in a case like this is when they bring these initial charges, it can influence other people's willingness to cooperate, and I think that's the question here. Now, that Allen Weisselberg is indicted, it's no longer an open question or a looming possibility. It is reality.

And so he will then make a decision of whether he wants to fight these charges or if he thinks that there's anything in it for him to cooperate. And that will depend, I think, in part on just the severity of these charges and what he thinks he has in terms of evidence to give to prosecutors as part of their ongoing investigation. Erica?

HILL: Kara, thank you.

Let's dig a little deeper now into what to expect. Joining me is CNN Senior Legal Analyst Elie Honig. So, we were just going over this a little bit with Kara. But the question today is we know about Allen Weisselberg. So, give us a better sense of the who right now in terms of who is being charged today because at him but it's also the company.

ELIE HONIG, CNN SENIOR LEGAL ANALYST: Erica, big day, we're going to learn a lot of important detail, but there are some things that we do know already. Today's indictment is going to charge two defendants.

Now, the first defendant is the Trump Organization itself. Yes, prosecutors can indict corporations even though they are not people but it's important to know they're only financial penalties. Now, this could mean the end of the Trump Organization, ultimately, if they get convicted, but there's nobody that can go to jail based on a corporate charge.

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The second defendant, however, is an individual, it's Allen Weisselberg, longtime chief financial officer of the Trump Organization. If convicted, of course, as an individual, he can go to jail. He is going to be a focal point because, as Kara just said, prosecutors are clearly trying to put pressure on Allen Weisselberg to flip him and get him to cooperate.

HILL: And so what types of crimes are we talking about here?

HONIG: So there's a lot of details we're going to get out of the indictment today. But the gist of it is tax fraud. Let me lay it out. I prepared a little demonstrative. Let's say in a normal company, you had an employee whose annual salary was $100,000, and the person was paid through normal paychecks, like you and I would get, $100,000. When tax time comes, they are going pay taxes, both the employee and the company, on $100,000.

The general gist of the allegation here, we're using round numbers, is the Trump Orgs, if they had an employee who made $100,000, what they would do is they would pay, let's say, $50,000 via paycheck but the other $50,000 through fringe benefits, tuition payments, cars and rent. And, therefore, when it came tax time, they are only paying taxes on $50,000.

So, this right here, that hypothetical $50,000 that they're paying through fringe benefits and then not paying taxes on, that is the fraud. So that's the gist of the allegations we're going to see today.

HILL: But correct me if I'm wrong. One of the things we've talked about a lot, I feel like, in the last several weeks, is that it's kind of rare that you're bringing charges solely on fringe benefits.

HONIG: It is. And if you look at other examples of other corporations who have been charged criminally, you get a sense. B.P., formerly British Petroleum, was charged in connection with the deepwater horizon disaster, where people were killed, where there was massive oil spill. You had Tyson Poultry was charged with enormous environmental violations. And then you had Volkswagen, who was criminally indicted as a corporation for violating emission standards, for installing cheap devices in over half a million cars.

I mean, these are high level examples, but it does gives you a sense of scale that if we're talking about fringe benefits, that's on the lower end of scale that I've seen corporate indictments from.

HILL: So, what does that make you think then about what could actually be in the indictment?

HONIG: Well, here's a couple of things I'm going to be looking for, for sure. The Trump Organization, despite all the cover of being this glamorous organization, is really just a small family held corporation. I'm going to be looking for two big things today.

First of all, does the indictment mention any of the Trumps who served as V.P, executive V.P. and owner? It's not going to say their names but there could be references, executive one, V.P. two, that kind of thing.

The other thing I'm looking for is what is the loss amount, how much tax loss are we talking about on Allen Weisselberg, because New York State law has a huge range of potential penalties depending on how much tax fraud. It could be anything from a little misdemeanor, no one is going to flip on that, up to charges carrying 25-year maximums. So I'm going to be looking for that as soon as the indictments come out.

HILL: As you mentioned, you said no one is going to flip on a little misdemeanor.

HONIG: Right.

HILL: Now, we were told from Allen Weisselberg's attorney he was not going to cooperate. Obviously, this is where we are today. He could still choose to do so.

HONIG: He absolutely could. And, look, this is clearly what the prosecutors on the case are trying to do. I will tell you from my own experience, Erica. I've had defendants who have sworn up and down, I'll never flip. Lawyers have told me they will never flip. When you see that indictment, when you get hit with that piece of paper, the state of New York versus Allen Weisselberg, that can be a game changer.

With that said, time is running out. You can flip at any point in a proceeding, but they are on the clock here. And the earlier someone flips, the better for the person who is cooperating and for prosecutors.

HILL: He has been with this company so long, right, since the '70s, 20-plus years as CFO. The amount of knowledge he would have is deep, to put it mild.

HONIG: Indeed. If you look at the inner circle, I mean, one of these things is not like the other, he's the only person whose last name is not Trump who has really been on the inner circle. He's been with them going back decades. He has been described by people who know the organization as the financial gate keeper, the guy who knew where every nickel went. So he is going to be so key. Let's see what happens with him. Let's see how much of an incentive he has to flip. And let's see where his loyalties lie. Do they sit with Trumps or do they sit with trying to keep himself out of prison?

HILL: All right. We will be watching. Elie, I appreciate it, as always.

HONIG: Thanks, Erica.

HILL: John?

BERMAN: Much more on this breaking news coming up, the president's -- former president's family business accused of criminal activity.

In the meantime, Bill Cosby is a free man this morning. The Pennsylvania Supreme Court overturned his conviction for sexual assault, saying that the 83-year-old actor's due process rights were violated. Cosby had been in prison since 2018.

I want to bring in Bill Cosby's former attorney, Tom Mesereau. Counselor, thank you for being with us.

So, the court made no ruling on whether Cosby did the things he was accused of. They did not say that the evidence and testimony was false. What they did say is the case should not have been brought at all because of a previous deal. Your reaction to all of this this morning.

TOM MESEREAU, BILL COSBY'S RETRIAL ATTORNEY: Well, yesterday was a great day for the Cosby family and was a great day for the justice system.

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There are two misconceptions floating around about what happened with the Pennsylvania Supreme Court. The first misconception is this was strictly a procedural or a technical matter. Not true. The first D.A. looked at the evidence exhaustively, got his staff together, his investigators, the police, they went through all the evidence, they made a substantive decision that this case did not belong in a criminal courtroom. And for that reason, he made an agreement not to prosecute and shifted it to civil court.

The second misconception is that this has never done. Not true. My whole career, we've been talking to prosecutors about trying to shift cases in criminal court to civil court. In fact, in California, where I do most of my practice, there's what is called by statute a civil compromise. Criminal cases can be resolved in a civil compromise where money is paid.

Though those two misconceptions have been floating around (INAUDIBLE) and it was a great day for the Cosbys, so justice was -- BERMAN: I just want to make one thing clear. The Pennsylvania Supreme Court did not say whether Bruce Castor, who was the D.A. at the time, was right or wrong to make the decision not to bring charges and make that deal to put it in civil court. It only said that he did so. And the fact of that deal made the second prosecution basically unfair, a due process violation. So that's what the Pennsylvania Supreme Court ruled on yesterday.

Now, more than 50 women have alleged that Bill Cosby raped or sexually assaulted them. And when asked in that 2005 deposition, when you got the Quaaludes, was it in your mind that you were going to use these Quaaludes for young women that you wanted to have sex with, Cosby responded, yes. And, again, the jury did find him guilty of three accounts.

Okay.

MESEREAU: You're --

BERMAN: Hang on one second, Tom. I just --

MESEREAU: (INAUDIBLE) was consensual.

BERMAN: Okay, go ahead.

Okay. Again, he doesn't admit to criminal activity. He admits buying Quaaludes to give women that he wanted to have sex with. And I just want to know what you think --

MESEREAU: He admits it was consensual (ph) activity.

BERMAN: -- of the women, the 50 women out there, plus, people out there in the country who are looking at all these allegations, what should they make of it now that Bill Cosby is free?

MESEREAU: We have a justice system where all are treated equally, all are entitled to due process, including somebody who has been vilified in the media for something they claimed they didn't do. Everyone is entitled to a fair procedure, a fair hearing, a fair use of evidence, and that didn't happen in this case. He's being treated equally like everybody else is supposed to be treated.

BERMAN: Do you think this will serve to dissuade or as a disincentive for sexual abuse victims to come forward in the future?

MESEREAU: I think it will be an incentive for judges to give people fair trials when they are required to.

BERMAN: And, again, you say deals like this are made all the time. Bruce Castor, who was the district attorney, he told Bill Cosby and his team at the time he was not going to prosecute them and that he should go ahead and testify in that civil case. Why wasn't that deal ever put in writing?

MESEREAU: You'll have to ask Mr. Castor. But according to the Pennsylvania Supreme Court, it doesn't have to be in writing. A prosecutor is held to a high standard of ethics. Their word is supposed to be their bond. He made an agreement not to prosecute, then he testified under oath that he made an agreement not to prosecute, and that should have been enforced by the trial judge.

Mr. Cosby has been treated poorly by the system. Thank God for the Pennsylvania Supreme Court, they have courage, independence, intelligence and they did the right thing.

BERMAN: What do you think Mr. Cosby will do going forward? Do you expect him to take any legal action now?

MESEREAU: I have not talked to him about that. he just got free yesterday. It's a great day for the family. He went to his home. He was unjustly imprisoned, unjustly prosecuted, unjustly tried, and I really haven't talked to him about anything like that.

BERMAN: Tom Mesereau, I do appreciate your time this morning. Thanks so much for joining us.

MESEREAU: Thanks for having me. I appreciate it.

BERMAN: All right. Joining us now is CNN Legal Analyst and Civil Rights Attorney Areva Martin. Areva, thank you for being with us.

Your take on the decision and what you just heard from Tom Mesereau.

AREVA MARTIN, CNN LEGAL ANALYST: Well, Tom and I went to different law schools and we went at different times, but the law school I went to taught us that when a court doesn't reach the merits of a matter and makes a decision that isn't on the merits, then that is a procedural ruling by that court. So I beg to differ with Tom's interpretation of what the Pennsylvania Supreme Court did.

And there's been a lot of reliance by the Cosby team on this so-called non-prosecution agreement that allegedly was made by Bruce Castor, the former district attorney. What we know is that that the trial court had real big issues with that alleged agreement. The agreement, as you stated, John, was not in writing, it was not sanctioned by the court, it wasn't your typical plea agreement that is often made in these kinds of cases.

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And I don't think any lawyer, any expert would take exception if there had been a more official plea agreement made with Cosby and his team that was memorialized in writing. The issue in this case is this seems like a side deal that was made, if it was made at all, between the former district attorney and this argument that somehow that district attorney can bind forever into perpetuity every district attorney that comes into that office is just not consistent with what we see in cases. We see oftentimes prosecutors make decisions not to prosecute. A new district attorney comes into office and looks at the evidence very differently and then moves forward with the prosecution.

So I think the Pennsylvania Supreme Court got this wrong. I think its decision is flawed. And I do have serious concerns about this decision having a chilling effect on women, women who were finally finding their voices, finally being able to come forward and tell their stories without fear of retribution, without fear of being marginalized and disbelieved. And I have real concerns that this decision might reverse the positive momentum that we saw with respect to women coming forth in these kinds of cases.

BERMAN: Well, talk to me more about that, because I talked to one of the victims -- one of the alleged victims last night, and she was really hurt by this. She was really upset that after all the courage it took to come forward that this is what happened. So what should women take from this?

MARTIN: First, I hope that women take that this is one case in one jurisdiction. So we don't want to use this case -- hopefully, women don't see this case as, you know, applying to cases across this country. But what I know, John, having represented women in these kinds of cases for over a decade is that there was a period in this country when women were actually afraid. They knew if they came forward, particularly if they came forward with allegations against a rich and powerful man like Bill Cosby, that they would suffer negative consequence, they would lose their jobs, they would be maligned in the media, they would be disbelieved by their employers and others in the environment.

And Bill Cosby, when he was prosecuted, he was the first celebrity during this Me Too movement that was prosecuted and then convicted on three counts. So his prosecution had, you know, a ripple effect, as you think about the Me Too movement and women coming forward. I just hope that that courage that women demonstrated in coming out, talking about allegations involving Bill Cosby and other rich and powerful men, that that momentum continues because in this moment, women's stories should be heard, their voices should be heard and accountability is the order of the day. And sexual predators should be held to account for their actions and that includes the criminally prosecuted and serving jail time.

BERMAN: Areva Martin, we appreciate your time this morning. Thank you.

MARTIN: Thank you, John.

BERMAN: We have live pictures for you now of President Biden and the first lady about to depart Washington for Surfside, Florida. You're looking at Joint Base Andrews in Maryland right now. When they get to Florida, they will meet with first responders and families. A three- hour block of time carved out for the Bidens to meet with the families of the victims or the families of the unaccounted for. We will bring you their departure live when it happens.

A new video that offers clues into the moments before the condo tower came crashing down.

HILL: And we are live outside the Manhattan District Attorney's Office, where longtime Trump Organization executive just turned himself in after a grand jury indicted him and the company. Stay with us. We have the very latest.

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BERMAN: Live pictures for you from Joint Base Andrews in Maryland. That is Marine One. The president of the United States and the first lady, Dr. Jill Biden, arriving there. They will depart for Surfside, Florida, where they will meet with families of those unaccounted for in the condominium collapse, the families of the victims already known lost there.

The Bidens have a large amount of time set aside to meet with families to console them, the president in his role as consoler in chief.

Again, there's Marine One at Joint Base Andrews. We're going to keep our eye on this.

Every once in a while, the president does speak before getting on Air Force One, so we want to make sure if he does have comments, we bring that to you live.

The death toll in Surfside stands at 18, 145 people unaccounted for. Overnight, new video surfaced showing water leaking in to the garage just moments before the collapse.

Joining us now is Kobi Karp. He's the local architect whose firm has worked on buildings in Surfside for years. Kobi, you've been so helpful to us this week in understanding what might have happened in Surfside. When you see the water leaking in the garage like that moments before the collapse, what kind of clue is that to you?

KOBI KARP, ARCHITECT WHOSE FIRM HAS WORKED IN SURFSIDE, FLORIDA: Number one, I just want to say that our prayers and our best wishes go out to the families and to the neighbors in our community.

The video that we are seeing shows the water fall essentially coming from above. I don't understand where that is coming from. And I think that the forensic engineering that's currently being done will reveal that. There are multiple options for that water penetration coming in to see that disturbing video.

BERMAN: Again we're watching live pictures from Joint Base Andrews. We see the president and first lady heading to Air Force One.

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They are on their way to Florida, to Surfside, to visit the people working on the site or have been working on the site and also meet with the families of the people either unaccounted for or the people we already know to be lost.

What are some of the possibilities when you look at the video of that water coming down inside the garage? And we do know or we have been told from witnesses that the collapse began in either the pool deck area or the garage area, not far from where we see that water there. What are the possibilities of what the source of that water could be?

KARP: So, the possibilities could be a few. What is interesting is that when you look at the video of the site now, the actual pool is still sitting there and the water is still sitting in the pool. It looks as though the collection of the water came from another location and it looks as though it came from either the pool deck, the rest of the pool deck, which was holding water and/or a bursting pipe due to a movement of the pipe and/or the structure.

As we saw in other videos and images that were taken by the report back in 2018 and later, the pipes that are exposed within the corroded structure has an ability, obviously, to disengage and brake. And at that point, the water just freefalls, and pulls itself down by gravity.

BERMAN: Kobi, we also saw reporting overnight in the Washington Post that in 2019, a number of the condominium board members left apparently over frustration or disputes over the repairs that needed to happen and the assessments, the very expensive assessments that were going on, all the condominium owners. What do you make of that?

KARP: The homeowners association is generally are made up of individuals who not necessarily have knowledge of engineering or construction. And it leads to frustration or politics, if you will, within the current homeowners association as to whether the money should be spent and how it should be spent on the repairs, the maintenance, the waterproofing of these buildings.

This is something that I believe is a new day that we will see a complete overhaul in change in the way we approach the homeowners association and the engineer's report relationships with the building department and the government officials, specifically that we have an ability today to really see more than just by eye but by scanning and by other means of technology, such as checking the salinity in concrete, doing X-rays and infrared to the buildings and seeing exactly what is behind the walls, what is behind the floor tiles and what is behind the ceilings.

That kind of inability, three-dimensional ability, is, critical number one, to have a full understanding, number two, also, to potentially have the homeowners association have individuals on their team that will clearly define for them the responsibility and the liability for not maintaining or correcting these issues.

Look, we all have homes. We cut our grass. We fix our roofs. We clean our gutters. That's what we do on a daily basis. If you do not do that to your home, you can expect it to have issues. If you do not maintain your structure, you have the same issues. It's like our body. If you don't maintain yourself, the waterproofing is like our skin and the saltwater here in the tropics is extremely corrosive.

BERMAN: Kobi Karp, I appreciate you joining us, helping us understand what is going on at that building, what we've seen in this new video. We did just saw the president and first lady board Air Force One. Very shortly, they will be wheels up on their way to Florida. Thank you, Kobi. So, the so-called delta variant now detected in all 50 states, delta variant, a coronavirus. Will the pace of vaccinations prevents a new widespread outbreak? We're going to speak to the former surgeon general.

And we are live outside Manhattan District Attorney's Office where a longtime Trump Organization executive just turned himself in after a grand jury indicted him and the company, the former president's family business facing criminal charges. Stay with us.

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