Return to Transcripts main page


White House Refusing to Confirm or Deny Existence of Memos Objecting to Kushner Security Clearance; Manafort Lawyers File Court Papers Asking for Reduced Sentence; Interview with Democratic Congressman Gerry Connolly (D-VA); Battle Over Security Clearances Accelerates With Report Of Trump Intervention; U.S. Officials Predict Surge In North Korean Cyber Attacks; Trump Responds To Rebuke From Dead Student's Family. Aired 5-6pm ET

Aired March 1, 2019 - 17:00   ET




BRIANNA KEILAR, CNN HOST (voice-over): Happening now: immediate compliance. Top House Democrat is demanding that the White House provide documents on how it issues security clearances but there are new signs of foot dragging following a stunning report that Trump personally ordered a top secret clearance for Kushner over the advice of intelligence officials.

Cohen again: former Trump lawyer will return to Capitol Hill for another closed door hearing. This week's testimony has Trump frantically firing back with a bizarre Twitter rant.

Is the president worried?

Make it public: in a strange twist Donald Trump Jr. and a key Republican congressman called for the Mueller report to be made public. That's just for starters.

What are they really driving at?

And no excuses: the family of Otto Warmbier rebukes President Trump for defending dictator Kim Jong-un in the brutal treatment and death of their son. They say no excuses or lavish praise can cover up the regime's cruelty.

Wolf Blitzer is off. I'm Brianna Keilar. You're in THE SITUATION ROOM.


UNIDENTIFIED MALE (voice-over): This is CNN breaking news.

KEILAR: A powerful House Democratic warning the White House must hand over security clearances for some of the president's closest advisers. It follows "The New York Times" report that President Trump personally ordered a top secret clearance for his son-in-law despite concerns from senior officials and intelligence agencies. Oversight Chairman Elijah Cummings wants to know exactly what those

concerns were and he is threatening subpoenas. His committee says the White House won't even confirm or deny that certain documents exist.

White House counselor Kellyanne Conway says the president "has the absolute right to order clearances."

The president, who denied doing this, went on offense today, capping a bad week with an incoherent Twitter tirade aimed variously at former lawyer Michael Cohen, the Russia investigation and Democrats.

I'll be speaking with Congressman Gerry Connolly of the Oversight Committee and our correspondents and analysts have full coverage of the day's top stories.

We begin with breaking news and CNN White House correspondent Abby Phillip.

Abby, the House Oversight Committee is saying the White House is dragging its feet over demands that it immediately provide documents about how it issued security clearances.

What's the latest?

ABBY PHILLIP, CNN WHITE HOUSE CORRESPONDENT: The House Oversight Committee is furious as the White House appear to be in their view stonewalling requests for information about "The New York Times" report that the president ordered officials to give Kushner top secret security clearance.

The committee says they've asked about two memos, one written by John Kelly and the White House counsel, Don McGahn, about this issue and that the White House hasn't responded multiple times. I asked the White House about that and no response yet.

But it is clearly one more issue raising tensions between this White House and this new House majority.


PHILLIP (voice-over): Tonight, the White House now defending President Trump's power to grant a top secret clearance to his son-in- law and top White House adviser Jared Kushner over the objections of career intelligence officials who raised concerns about his background check.

UNIDENTIFIED FEMALE: Was the president involved in Kushner's security clearance process?

KELLYANNE CONWAY, TRUMP SENIOR ADVISER: The -- we don't discuss security clearances. I'm not going to discuss my own. But I will tell you that the president has the absolute right to do what was described.

PHILLIP (voice-over): Counselor to the president Kellyanne Conway not standing by Ivanka Trump's claim in an interview three weeks ago that her father wasn't involved in the process.

IVANKA TRUMP, PRESIDENT TRUMP'S DAUGHTER: The president had no involvement pertaining to my clearance or my husband's clearance.


PHILLIP (voice-over): "The New York Times" reports that last year Trump ordered White House chief of staff John Kelly to grant Kushner's clearance despite Trump's denial in an interview in January.

UNIDENTIFIED FEMALE: Did you tell General Kelly or anyone else in the White House to overrule security officials, the career veterans --

PRESIDENT TRUMP: No. I don't think I have the authority to do that. I'm not sure I do. But I wouldn't. I wouldn't do it.

PHILLIP (voice-over): And Kushner's lawyer Abbe Lowell's claim to Blitzer.

ABBE LOWELL, LAWYER: He's a special office that does security measures. They are all career people. There was nobody in the political process that had anything do it, nobody that pressured it. It was just done the normal, regular way.


PHILLIP (voice-over): House Oversight Committee chairman Elijah Cummings in a sharply worded letter is now demanding the White House turn over all documents related to security clearances by Monday.

Meantime, President Trump is firing back in a tweetstorm at his former fixer, Michael Cohen, two days after he testified before the committee in public.

MICHAEL COHEN, FORMER TRUMP ATTORNEY: He is a racist. He is a con man and he is a cheat.

PHILLIP (voice-over): The president suggesting that Congress demand a manuscript of Cohen's book that he claims is a love letter to Trump. Tweeting, "Your heads will spin when you see the lies, misrepresentations and contradictions against his Thursday testimony. Like a different person. He is totally discredited."

As Trump remains fixated on Cohen, his comments this week giving dictator Kim Jong-un a pass for the death of an American student who was returned to the U.S. in a coma after months of detention by the North Korean regime is coming under fire.

The family of Otto Warmbier, who once sat with the first lady at the State of the Union address, now saying this.

"Kim and his evil regime are responsible for unimaginable cruelty and inhumanity. No excuses or lavish praise can change that."

(END VIDEOTAPE) PHILLIP: President Trump is now trying to clean up his comments about Kim. In two tweets, the president says, "I never like being misinterpreted but especially when it comes to Otto Warmbier and his great family.

"Remember, I got Otto out along with three others. The previous administration did nothing."

He continues to say that, "Otto and his family have been a tremendous signal of strong passion and strength which will last for many years in the future."

He adds, "Of course, I hold North Korea responsible for Otto's mistreatment and death."

The president is making it clear that he does hold North Korea responsible. He was asked in Vietnam about whether he holds Kim personally responsible, he says, "I take him at his word" when Kim says he has nothing to do with Otto's death -- Brianna.

KEILAR: It's important to lay that out. Abby Phillip, thank you so much.

We do have some more breaking news. Paul Manafort's lawyers just filed court papers arguing he should get a reduced sentence following his conviction in Virginia.

I want to bring in CNN senior Justice correspondent Evan Perez.

Evan, this is just in. Walk us through this.

EVAN PEREZ, CNN JUSTICE CORRESPONDENT: The bulk of the memo argues that Manafort deserves less time than the special counsel has argued. The guidelines in the Eastern District of Virginia case for which Manafort is convicted is 19 and a half to 24 years. They say this is disproportionate to the offense and they also point out Manafort is a first time offender.

There are a couple of points of the filing that we'll read. One is taunting the special counsel for not finding collusion so far in their investigation as it relates to Manafort. They say -- they talk about his work for political candidates.

They say, "He worked hard and was proud of what he achieved. Mr. Manafort's career culminated as serving as an adviser and campaign chairman for then candidate Donald J. Trump successful campaign in 2016.

They point out, "Shortly after the election, the acting attorney general appointed the special counsel to investigate allegations that Mr. Trump's campaign colluded with the Russian government to influence the election."

They point out, "after being unable to establish that Mr. Manafort engaged in any such collusion, the special counsel charged him with crimes unrelated to Manafort's work in 2016." They make another footnote, calling attention to the fact there has been no collusion charge in this case. They say, "The special counsel's strategy in bringing charges against Mr. Manafort had nothing to do with the special counsel's core mandate, Russian collusion, but was instead designed to 'tighten the screws' in an effort to compel Mr. Manafort to cooperate and provide incriminating information about others."

Again, this is something we have seen in another court filing in the last week in the District of Columbia case where Paul Manafort pleaded guilty. They sort of reminded everyone that, so far from the Mueller investigation, there have been no charges. Nothing directly related to alleged collusion, coordination.

And so they are sort of reminding everyone of what has not been so far seen in the Mueller investigation and they are asking the judges here to sort of give him a break because these were unrelated to the central focus of what Mueller was supposed to be doing.

KEILAR: Does it strike you how much this document goes after the Mueller investigation?

It would make a lot of observers wonder here if the president isn't part of the audience of this.


PEREZ: I think that's exactly right. If you're someone facing a lot of time -- Manafort is about to turn 70 years old. He is facing perhaps the rest of his life in prison and he is hoping for a pardon from the president -- I think the words "no collusion" are exactly the words you would be saying over and over and over to remind the president of what has happened.

Paul Manafort's team believes, was it not for the fact that he worked for Donald Trump and worked as his campaign chairman, he would not be in this predicament. None of this would have happened if it weren't for the fact that he came to work for Donald Trump.

So he has been punished for having done that work. I think it's a reminder that they believe that he deserves a break as a result of that.

KEILAR: How does it weigh on the judge's decision?

PEREZ: Look, I don't know how much it is going to work for Manafort. He was found guilty. He had a chance at the beginning of this case and he decided to go to trial in two different jurisdictions. We know this judge can be very tough, Judge Ellis in the Eastern District of Virginia. These are serious crimes he's convicted of. So I don't know how much of a break he will get.

Certainly in D.C., that judge has shown no mercy whatsoever with regard to Manafort. She said he has lied repeatedly, has a history of thumbing his nose at the courts. And so she doesn't believe it doesn't seem like he deserves much of a break. In that case, he is only facing perhaps as much as 10 years in

Alexandria, Virginia. It is the case we have this filing today he is looking at decades possibly.

KEILAR: Effectively a life sentence.

PEREZ: Exactly.

KEILAR: Thank you for that report.

Joining me now is Democratic congressman Gerry Connolly of Virginia. He is a member of the Oversight Committee.

Thanks for being with us.


KEILAR: What's your reaction to this sentencing document, the argument from Manafort's lawyers where they were talking about how there is no collusion.

What do you make of that?

CONNOLLY: It is eerily reminiscent of the chant of Donald Trump himself, there was no collusion. There was no collusion. Did I mention there was no collusion?

The other day when Cohen came before our committee he pointed out, when he was being prepped by Donald Trump before testifying, Donald Trump would repeat, remember, there was no collusion.

And I think it's code for Manafort sending to the president that I'm with you. There's no collusion and I never testified that there is. We can't let that distract us from the crimes Manafort is convicted of and why he is going to go to jail, which involved massive fraudulent schemes to hide foreign revenue in the millions and millions of dollars, foreign bank accounts, money laundering, wire fraud and other crimes, for which he actually pled guilty.

KEILAR: Do you think he's fishing for a pardon?

CONNOLLY: I think he's fishing for a pardon and I think that code, no collusion, I think that is a way of signaling I did not testify before Mueller about anything having to do with you and Russia.

KEILAR: I want to ask you about chief of staff John Kelly. You want to bring him in so he can answer questions about the security clearance process in the White House, maybe specifically pertaining to Kushner, the president's son-in-law. "The Times" is reporting that the president intervened to get his clearance pushed through.

Do you think Kelly can shed light on why the Intelligence Committee was so reluctant to approve the idea of Kushner getting a clearance?

CONNOLLY: I do. In fact, what we saw again, you saw it on the clip before, once again trying to deflect our attention, arguing something no one is arguing, that the president has the opportunity to give you a security clearance regardless of your state and the process. No one is arguing against that.

What we are worrying about is why did Trump lie about it?

Why did he say I didn't do that and I never would do that when in fact he did?

Secondly, why was Kushner denied on four tries a security clearance and what bothered Kelly and McGahn so much was they felt they had to memorialize it in a memo?

KEILAR: That's right. You want these contemporaneous memos, your committee does, filed by John Kelly and the White House counsel. Your committee says the White House is not producing them.

What is the committee prepared to do to get them?

CONNOLLY: This goes back a ways. It is not just -- it's not about the Kelly memo. It is about lots of documents in the issuance of interim security clearances we felt could be improper. We know some of them were, like this one.

Those requests go back over a year. And so our committee today issued a final warning to the White House, you have one last chance --


CONNOLLY: -- to get them to us by the end of the first week of March. Or we will seek other ways to compel the issuance of those documents.

KEILAR: A subpoena?

CONNOLLY: A subpoena.

KEILAR: Are you prepared to subpoena John Kelly and those documents?

CONNOLLY: I don't know that we'll need to subpoena John Kelly. My hope is that he is enough of a patriot, he will come forward and voluntarily explain to the committee why he memorialized these concerns in a memo.

KEILAR: If you hear from him on that topic, will there be other topics you want him to talk about?

CONNOLLY: That obviously is always something that is negotiated with the witness unless they are compelled to testify.

KEILAR: So he would have some ability to negotiate the parameters of that?

CONNOLLY: Absolutely.

KEILAR: What would the committee's stance be?

CONNOLLY: Right now I think we have a need to know about this issue.

KEILAR: About this particular issue.

CONNOLLY: So that will drive us. If Mr. Kelly is willing to come back and talk about other subjects as well, obviously we would welcome his cooperation.

KEILAR: After Cohen's testimony this week, which took over Washington, many Democrats are really wanting to dig deeper when it comes to the president's business, the Trump Organization. Michael Cohen named some names here. He talked about Allen Weisselberg, Matthew Calamari, Ron Liebermann.

How do you plan to pursue this line of investigation?

CONNOLLY: Well, our chairman has indicated, if you were named during the hearing by Mr. Cohen, you're likely going to be a subject of interest by the committee and likely to be called for the committee for testimony, either in private deposition or in public session.

KEILAR: So Jared Kushner, Ivanka Trump, Eric Trump?

CONNOLLY: Mr. Cummings made no exceptions. I would carve out a little bit there. I think family members are in a different category and some of them are the subject of possible criminal investigation, Donald Jr. and Ivanka maybe, in the Southern District of New York.

So maybe it is best to let the Southern District do that. I think the optics of family members being compelled to testify before a committee are probably not good.

KEILAR: I talked to Christian Worthy (ph) earlier. He seemed today have a reticence to talk about bringing Ivanka Trump in but not Donald Jr. so much.

Do you share that?

CONNOLLY: I would just say to my fellow Democrats we should be very cautious about pursuing family members when there are so many other targets available to us right now that I think are of equal or even greater interest.

KEILAR: All right, Congressman Connolly. Thank you so much.

CONNOLLY: My great pleasure.

KEILAR: More on our breaking news. Paul Manafort's lawyers just filed court papers arguing he should get a reduced sentence following his conviction in Virginia.





KEILAR: We are following multiple breaking stories. Manafort's lawyers just now filing court papers, arguing the former Trump campaign former chairman is "truly remorseful for his conduct," and they argued that Manafort should get a reduced sentence following his conviction in Virginia.

Jeffrey Toobin, to you first, what do you make of this argument from Manafort's lawyers that the special counsel is essentially trying to railroad Manafort after prosecutors were not able to find collusion?

JEFFREY TOOBIN, CNN SR. LEGAL ANALYST: Well, look, I think Manafort has smart lawyers. They recognize his only hope for getting out of prison has nothing to do with what's going on in court; it's to get a pardon.

Everything in that memo is about how the prosecutors failed to prove collusion. There was no collusion. That is a message that Donald Trump wants to hear. I don't think the judge cares one way or another. He was prosecuted for fraud.

And that's what he's being sentenced for. But the endless emphasis on no collusion is an appeal for a pardon and that's the only way he is getting out of prison. So I don't blame the lawyering for pushing it.

KEILAR: Congressman Connolly just said the same thing, he is fishing for a pardon.

What do you think?

SHAWN TURNER, FORMER DIRECTOR OF COMMUNICATION, U.S. NATIONAL INTELLIGENCE: I think that's absolutely right. As Jeffrey said, when you look at this documentation, it is clear, even though he has gotten in trouble in the past for attempting to communicate directly with members of the White House, what he is doing now is his lawyers are saying, we are not communicating directly.

But we can send subtle messages to the White House that give him a sense of what we are looking for and what we are willing to do to get it. I think this is more of the same.


KEILAR: -- problematic that it's not so subtle?

There's no consequence --


KEILAR: -- it's OK?

TURNER: As Jeffrey said, he has pretty smart lawyers who are probably covering him on this but there's no question about --


healthy. He is not a flight risk. He is remorseful. And by the way, there was no collusion. Hello, Donald Trump.

So I think the more they can make this case and appeal to Donald Trump and say, look, we apologize and, you know -- don't forget Trump has said he doesn't like the way Manafort was treated.

KEILAR: He said positive things about him.

BORGER: -- brave or courageous or words to that effect. So it seems to me that the president is sort of inclined to be very positive toward Manafort.

TOOBIN: Could I raise one other thing?

I know everybody has political enemies and whatnot but I think there should be an element of humanity here. I was looking at what we call the B-roll, what we just showed of Manafort walking out of court in Virginia. He is an utterly transformed person. I saw him in court the other day. He can't walk like that anymore. He is walking with a cane.


TOOBIN: He looks disoriented. He has aged dramatically in prison. You can like Paul Manafort or not but the physical toll this has taken on him is enormous. And I think it's worth remembering that and I think the lawyers are right to point that out.

KEILAR: He had to go to the hospital at one point.

Do you think, Rebecca, that Manafort has an audience, that the president is receptive to this, that he will be comforted by what he is hearing in this memo by Manafort's lawyers?

REBECCA BUCK, CNN POLITICAL CORRESPONDENT: It is certainly possible. When you think about what we have seen in the past from the president, he is comfortable using his pardon power, even when there are potential political ramifications for him.

And number two, he has clearly expressed he believes this is not a legitimate investigation by Mueller. So if you add those two factors up, it seems he would be likely to pardon Manafort.

The other side is what is the political impact on the president?

Democrats are trying to make this a political issue in the 2020 race. Senator Elizabeth Warren saying she would not stand for any pardons of people wrapped up in the Mueller investigation.

KEILAR: How does the judge in this case relate to the special counsel?

(CROSSTALK) TOOBIN: It is very different between Virginia and Washington. In Virginia, Judge Ellis was incredibly hostile to the Mueller team. I mean it was a very contentious relationship. So I anticipate, you know, they will not be terribly receptive. Although most judges follow the sentencing guidelines. They are not mandatory, although they once were. So I think that's one factor.

There was just a guilty plea in front of Judge Berman Jackson in Washington. There was certainly no contention between the prosecutors there and the judge.

But when you look at the two cases, it's just he is looking at an enormous sentence. This is a man that's about to turn 70. It is hard for me to imagine regardless of the relationship between the lawyers and the judges, that he gets anything under a total of at least 10 years.

KEILAR: We'll see if the judge agrees with you on that. Everyone stand by. We have much more ahead with you. I want to ask about another breaking story. A fight between congressional Democrats and the White House over Jared Kushner's top secret security clearance.


[17:32:17], BRIANNA KEILAR, CNN ANCHOR: The breaking news in the latest fight between the White House and Congressional Democrats. The House Oversight Committee says the White House refused three times to confirm or deny whether there are memos with the President's top aides objecting to a Presidential order to grant a top secret security clearance to his son-in-law Jared Kushner.

We're back now with our legal and political experts. So, Shawn you worked in the Intel community, so tell us why this is so unusual in light of how this normally works.

SHAWN TURNER, FORMER DIRECTOR OF COMMUNICATIONS, U.S. NATIONAL INTELLIGENCE: Yes, you know, there are so many reason. This is unusual. First of all it is important to point out that this process is one in which it doesn't matter who you are or who you know, the process is the same for everyone. You go through an exhaustive security process where the intelligence community looks at everything from your finances to your social networks, or your foreign contacts.

What really concerns me about this particular process is that, you know, the President had every right to do this but Jared Kushner didn't receive its security clearance because he did something that fell into one of two categories. Either he had done something in his past that was of such a nature that it would have disqualified him from getting security clearance, you know, that would have been something that was either illegal activity or suspicious activity, or there was something in his past that would have made him vulnerable to being blackmailed by a foreign entity.

One of those two things, this is not like, you know, the average person who has too much credit card debt or something along those lines. Because the intelligence community tries very hard to make sure that President has the advisors that he wants.

GLORIA BORGER, CNN LEGAL ANALYST: Well you know he had to file this form the SF-86 four times.


BORGER: His first form outlined zero contacts with foreign officials. And we know that was wrong. And his attorneys said that was filed by mistake et cetera. But then he had to update it three other times. So, clearly there were red flags that were raised, particularly since we know Jared Kushner's companies were foreign, dealt with foreigners, and had investments abroad. And we also know that Jared established himself as a so called backchannel to Russia and other foreign entities during the transition, and the original application none of that was listed, is that a red flag?

TURNER: And in every subsequent application there was information that was missing. And so this is not to suggest that Jared Kushner was somehow a threat to National Security. The real question is why would you omit information that's discoverable?

KEILAR: And Jeffrey, as we've learned John Kelly and Don McGahn, the White House counsel, so you have the chief of staff, you have the White House counsel and they are so concerned with the President's involvement in this process that they actually wrote memos which reminds us of course of FBI director Jim Comey. And they detailed their concerns. What does that tell you?

[17:35:03] JEFFREY TOOBIN, CNN CHIEF LEGAL ANALYST: That they had some pretty serious concerns, that they were writing their memos to the file because this was so irregular that they didn't want to be blamed down the line when this came out, this incredibly irregular process.

I mean these all underlines why companies, governments, people with common sense avoid nepotism, because nepotism creates problems where people are treated differently because they are related to the boss. And that's clearly what happened here.

And the President had every right under the applicable laws to do what he did, but this just shows why it looks bad because it's nepotism. And, you know, that's why most companies have rules against it.

KEILAR: One of the oddest things about this Rebecca is the President appearing with this, with these reporters through lying about what he did. Not only what he did but also about knowing whether or not he had the authority to do it. Let's listen to this part of this interview that he did with Maggie Haberman of the New York Times.


MAGGIE HABERMAN, WHITE HOUSE CORRESPONDENT, NEW YORK TIMES: Did you tell General Kelly or anyone else in the White House to overrule security officials? The career veterans?

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: No. I don't think I have the authority to do that. I'm not sure I do. But wouldn't do it.

HABERMAN: OK. You do have the authority to do it.

TRUMP: Jared's a good -- I was never involved with his security. I know that he, you know, just from reading. I know that there were issues back and forth about security for numerous people actually, but I don't want to get involved in that stuff.


KEILAR: We've also seen Ivanka Trump appear to lie about this, so.


KEILAR: How much worse does it make that he appears to lie about this?

BUCK: It makes it so much worse, Brianna, from an optics perspective. Because now this raises the question of why, why is he lying about this? Why did the President and Ivanka and Abbe Lowell, and everyone lie about this? So, instead of just explaining that the President has this authority to grant Jared Kushner a security clearance if he so chooses, if he wants to override the opinion of the intelligence community. And that he did it because he needed Jared to do his job. It would have been a very simple easy explanation. He would have gone some political go back for it.

But now, it leaves us wondering and it's going also probably just spark Democratic investigations in Congress into why this happened.

KEILAR: Why do that do -- what -- do they have an idea of why that happened? Are they lost or do they have suspicions?

BUCK: You know, there are -- House Oversight Committee Chairman Elijah Cummings said he is looking into subpoenaing documents. Of course, we're talking now about John Kelly potentially testifying to Congress about this. It could have been as simple as they did want Jared to have the security clearance.

BORGER: It would be interesting to know exactly what Don McGahn's memo to self it said and what Kelly's memo said, and what they were thinking and why they were upset. And why Kelly apparently felt pressured and didn't want to do it but the President overruled him. Once Congress starts investigating that, I think we'll -- I think we'll be able to unravel this a little bit.

KEILAR: We'll see if they reveal why. What the reasoning was --

BORGER: We'll probably get.

KEILAR: -- behind him not getting a security clearance initially was.

BORGER: Right.

KEILAR: You guys, thank you so much. Really appreciate your insight. And coming up, President Trump responds to criticism from the family of U.S. student who died as a result of his time in North Korean custody.


[17:43:10] KEILAR: Tonight in the wake of President Trump's failed summit with Kim Jung-on, there's an ominous new warning to be on the look out from more North Korean cyber attacks. I want to bring back Evan Perez to talk about this. So you have spoken with U.S. officials who say that it is a global threat, that the North Koreans essentially are desperate for cash.

EVAN PEREZ, CNN SENIOR JUSTICE CORRESPONDENT: Right, exactly. I mean, look, they are under severe sanctions as we saw during a summit meeting. That's one I think that we're complaining about. And so, as we've seen those sanctions taken effect, they -- their spy services essentially have unleashed on the world carrying out cyber attacks to try to raise money, everything from ransomware attacks to stealing money, $81 million of the Bank of the Bangladesh back in 2016 which is the central bank there.

We talk to John Demers who's the head of National Security at the Justice Department about this threat. Take a listen to how he put it.


JOHN DEMERS, ASSISTANT ATTORNEY GENERAL FOR NATIONAL SECURITY: The money some times just, you know, stealing actual money. There are current -- there are country that had -- doesn't have --

PEREZ: So straight up bank robbery thing.

DEMERS: Yeah, straight up cyber bank theft. So that's a piece of -- that's a significant piece of what they do in cyber space. They just need money. They need a hard currency. That's a good way to get it. And then if we're going to choose among the banks, you're not going to start with the largest most sophisticated bank with the most sophisticated cyber defense because you're going to see and look around and see maybe who you think might be more vulnerable.


PEREZ: And what he is referring to there is obviously the Bank of Bangladesh. Bangladesh Bank is obviously not city bank and it doesn't have the best sophisticated protections. And so that's what the North Koreans are doing there, going after small businesses. They don't care what amount of cash. They just need cash to fill their economy.

KEILAR: Are they good at hacking?

PEREZ: It turns out they've -- out of nowhere become really good.

[17:45:00] Look, the Russians are looking for ways to destabilize the country. The Chinese are stealing intellectual property, trying to help their own economies. The Iranians are trying to figure out how to infiltrate things in case the United Stated cyber attacks them. The North Koreans, it's totally different kind of spy service they have. They essentially a money making one, a bank robbery operation that they have and it is extremely successful. Hundreds of millions of dollars is what it looks like they are collecting in these schemes around the world.

KEILAR: Wow, Evan Perez, thank you so much for that report.

PEREZ: Thank you.

KEILAR: Coming up, President Trump responding to criticism from the family of a U.S. student who died as a result of his treatment in a North Korean prison. Was the President as he claims misinterpreted?


[17:50:25] KEILAR: The family of Otto Warmbier has issued a sharp rebuke of President Trump after his shocking public defense of dictator Kim Jong-un in the brutal mistreatment and death of their son.

Our Brian Todd is here with this. And the family really did not hold back, Brian.

BRIAN TODD, CNN CORRESPONDENT: They did not, Brianna. A lot of pent up anger coming from the Warmbier family today. And tonight, the White House is still doing damage control following the President's remarks in Hanoi.


TODD (voice-over): Analysts called it a low point in an all ready dismal news conference.

TRUMP: He tells me that he didn't know about it. And I will take him at his word.

TODD: The President's saying he supported North Korean dictator Kim Jong-un's stance that Kim didn't know of American college student Otto Warmbier's deteriorating condition in a North Korean prison.

TRUMP: I don't that believe that he would have allowed that to happen.

TODD: Tonight, that statement is receiving a stinging rebuke from Warmbier's parents. Fred and Cindy Warmbier saying they've not spoken during the summit out of respect, but now could hold back no longer. In a statement saying, "Kim and his evil regime are responsible for the death of our son Otto. No excuses or lavish praise can change that."

ROBERT KING, FORMER U.S. SPECIAL ENVOY TO NORTH KOREA FOR HUMAN RIGHTS: For them, this is a horrible situation to go through. And I can understand their concern about what was said.

TODD: Otto Warmbier, a student at the University of Virginia, was arrested for allegedly stealing a political sign during his tour at Pyongyang in early 2016 during what was widely seen as a show trial, he wept. OTTO WARMBIER, AMERICAN STUDENT WHO WAS IMPRISONED IN NORTH KOREA: Safest core of innocent scapegoat.

TODD: Warmbier was sentenced to 15 years of hard labor. A 1.5 year later, North Korean diplomats abruptly asked for a meeting with their U.S. counterparts and told them the young American was in a coma. Warmbier was quickly evacuated and died just a couple of day after returning home. Trump initially attacked Kim and his regime for the death.

TRUMP: We need only look at the depraved character of the North Korean regime.

TODD: And he embraced Warmbier's parents, inviting them to the State of the Union Address.

TRUMP: You are powerful witnesses to a menace that threatens our world. And your strength truly inspires us all.

TODD: Analysts said that seemed to be a far cry from his comments this week.

TRUMP: He felt badly about it.

TODD: Tonight, facing backlash from the family, the President took to Twitter saying he had been misinterpreted on Thursday. "Of course I hold North Korea responsible for Otto's mistreatment and death. Most important, Otto Warmbier will not have died in vain. I love Otto and think of him often."

KELYANNE CONWAY, WHITE HOUSE COUNSELOR: The President is saying is that there's no indication Chairman Kim knew what happened to Otto Warmbier when it happened.

TODD: But that seems improbable, expert say, because after his death, doctors who examined Otto Warmbier said they believed he'd been in a vegetative state for 14 months before being sent home.

If he is in a vegetative state for 14 months, does Kim Jong-un not know about it at all during that time?

KING: Kim would have known as soon as they had determined that this was something that wasn't reversible. He would have known immediately.

TODD: So why would President Trump have said he believed Kim? Analysts say it could have been for pure political expediency.

MARCUS NOLAND, PETERSON INSTITUTE FOR INTERNATIONAL ECONOMICS: On human rights groups have not been given much access to the administration which is clearly prioritizing the nuclear negotiations and thinking that human rights issues may get in the way.


TODD: So in the end, will Kim Jong-un ever be held accountable in the case of Otto Warmbier? Analysts say that is not likely. The Warmbier family was recently awarded more than $500 million in a wrongful death lawsuit against the North Korean regime. But experts say it's not likely they're going to collect much if any of that. What could happen expert say is that the Warmbier case could be used as leverage with the North Koreas in negotiations over the possible lifting of sanctions. Brianna?

KEILAR: And Otto's parents claim that he had been tortured during his detention in North Korea. What did the doctors who examined him say?

TODD: Right, Brianna. Warmbier's parents have said his legs were deformed when he was returned to the U.S. And they said it looked like someone had rearranged his bottom teeth with a pair of pliers. But the coroner in Hamilton County, Ohio who examined Warmbier said they found no evidence of trauma to the lower teeth, no indications of torture. Still just about everyone agrees that Otto Warmbier deteriorated because of those conditions that North Korea's placed him in, in that prison there.

KEILAR: All right, Brian Todd, thank you so much for that.

Coming up, we have breaking news. Lawyers for Paul Manafort file court papers arguing that the former Trump campaign chairman, who is caught up in the Mueller investigation, is, quote, truly remorseful. They're arguing for a prison term well below sentencing guidelines.


[17:59:33] KEILAR: Happening now, breaking news. Manafort fights back. In a new court filing tonight, the former Trump campaign chairman accuses the Special Counsel of trying to vilify him and send him to prison longer than he deserves. Is Paul Manafort trying to build a case for a presidential pardon?

Demanding clearance, Congress wants answers about how Jared Kushner got access to top secrets, but there's no resistance tonight from the White House. We are following the fallout from a report that the President overruled aides' concerns about his son-in-law and senior adviser.

Questioning Trump world.