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U.S. Officials Claim Iranian Quds Force Behind Assassination Plot; Underwear Bomber Pleads Guilty to Charges; Libyan Revolutionary Forces May Have Captured a Son of Moammar Gadhafi; Mitt Romney and Rick Perry Face off in GOP Debate; Millions of BlackBerry Messages on Hold; Interview With Israeli Ambassador to the United States Michael Oren; Israeli Soldier Freed in Prisoner Swap; Panic in Corn Maze

Aired October 12, 2011 - 17:00   ET


WOLF BLITZER, HOST: And to our viewers here in THE SITUATION ROOM.

Happening now, the missing link within Iran's military to an alleged assassination plot on U.S. soil. This hour, new information about one of the suspects, an officer in Iran's feared Quds force.

Where is he and what proof does the United States have to blame Iran? Plus, the Republican presidential candidates are gearing up for their next presidential debate and at least one of them still has a lot to prove. Standby for the winners and the losers of the face off on the economy.

Plus, the Republican presidential candidates are gearing up for their next presidential debate and at least one of them still has a lot to prove. Stand by for the winners and the losers of the faceoff on the economy.

And a BlackBerry blackout is spreading around the world. You're going to find out why millions of customers don't have service and when your BlackBerry might work again.

We want to welcome our viewers in the United States and around the world. Breaking news, political headlines, and Jeanne Moos all straight ahead. I'm Wolf Blitzer. You're in THE SITUATION ROOM.

The Obama White House says it's keeping all options open to punish Iran for an alleged assassination plot here in the nation's capital. The Obama administration is standing firm in saying that Iran must be held accountable for a foiled scheme to kill the Saudi ambassador to the United States.

The U.S. treasury department announced today that an Iranian commercial airline has been sanctioned for its ties to Iran's Quds Force. U.S. officials say senior members of the elite branch of the Islamic Revolutionary Guard were behind this alleged plot. The chairman of the House Homeland Security committee right here in Washington, Representative Peter King, tells me he believes someone even higher in the Iranian regime may have been involved.

(BEGIN VIDEO CLIP) REP. PETER KING (R), NEW YORK: It would be an act of war if it was carried out. So I just have to believe that considering what an elite force this is, this would not have been done unless it was sanctioned by the highest levels of the Quds Force, and I can't imagine they would sanction it unless they had been given the sign off by people higher in government, perhaps all the way to the top.


BLITZER: The Iranian government lodged a formal complaint about the U.S. allegations today, accusing the Obama administration of fabricating the entire thing. And an Iranian-American suspect in the plot is in custody in New York and facing another court date in two weeks. Manssor Arbabsiar is accused of conspiracy to murder a foreign official and to commit terrorism. But a longtime friend is describing the former used car salesman as, quote, "a happy go lucky guy." And his estranged wife says she believes he's innocent.


MARTHA GUERRERO, MANSSOR ARBABSIAR'S ESTRANGED WIFE: I cannot for the life of me think that he would be capable of doing that. He was at the wrong place at the wrong time, I'm sure of that. And I know that his innocence is going to come out.


BLITZER: Let's bring in CNN's Brian Todd. You're not only looking at Arbabsiar, you're looking at the other suspect named in the criminal complaint yesterday.

BRIAN TODD, CNN CORRESPONDENT: That's right. That suspect, Wolf, is at large. He is apparently a long way away from the reach of U.S. officials. He could very well be protected by a powerful and feared Iranian military unit, and he could still be very dangerous to western citizens.


TODD: U.S. officials say chief suspect Manssor Arbabsiar was given a code word for the plot to kill the Saudi ambassador, "Chevrolet." They say when Arbabsiar told his Iranian handlers the Chevrolet was ready, he was told, "buy it," meaning go ahead and kill him. The man who told him that, U.S. officials say, is Gholam Shakuri, an officer in Iran's feared Quds Force. Shakuri is charged as conspirator, but where is he?

ERIC HOLDER, U.S. ATTORNEY GENERAL: Shakuri, based in Iran, remains at large.

TODD: At large and experts say very elusive. They say he's probably in Tehran, likely a focus on western law enforcement, but for now out of their reach.

(on camera): Is there no chance of getting him? TOM FUENTES, CNN CONTRIBUTOR: No, there's a chance. I think the next step would be for the U.S. to issue provisional arrest warrants for him, then go to Interpol in Lyons, France, and submit their package to the attorneys there.

TODD (voice-over): Former FBI assistant director Tom Fuentes says then Shakuri could be apprehended, but only if he leaves Iran.

(on camera): U.S. officials say Gholam Shakuri, who they believe managed big money transactions in this plot, is a deputy to one official in the Quds force identified as a cousin of suspect Manssor Arbabsiar. They all allegedly worked for General Qassem Suleimani, commander of the Quds force.

(voice-over): Under Suleimani's leadership, experts say, this shadowy, secretive unit, an arm of Iran's Revolutionary Guard, uses terrorist groups around the world to do its lethal bidding.

PROFESSOR VALI NASR, TULSA UNIVERSITY: The Quds forces has their training, army, their recruitment, all of them. Bombing attacks, use of IEDs, assassinations, all of these happen as part of the conflicts in places like Lebanon and Iraq.

TODD: I asked Fuentes if western citizens should be worried about Gholam Shakuri.

FUENTES: I would think he's a threat, yes, because you don't know if this is the only person he was dealing with. If he has many operatives in various parts of the world or others possibly in the United States, although that seems probably unlikely in this case, you would think he would have responsibility for more than one potential attack.


TODD: Tom Fuentes says that means there could be other attacks being planned right now by Gholam Shakuri and the Quds Force, possibly targeting Europe, South America, or elsewhere, and using different cells of operatives, Wolf, a pretty scary thought.

BLITZER: Yes, very scary, but what are you hearing about these suggestions that perhaps this alleged plot was part of some sort of Iranian retaliation against the Saudis?

TODD: That's right. You blogged about the rivalry between Iran and Saudi Arabia. That's been going on for centuries. Experts are telling us this plot could have been in retaliation for Saudi Arabia's actions during the Arab spring. The Saudi's sent troops in to help the ruling family to put down the revolution there. The ruling family is minority Sunni Muslim like the Saudis. Well, that apparently angered the Iranians, who sided with the Shia majority in Bahrain, and this may have been in retaliation for that. So this is a lot of intrigue between the Iranian and Saudis.

BLITZER: It's murky. Check out my blog at Brian, thanks very much. Meanwhile, Top U.S. lawmakers are being briefed about the alleged assassination plot and why the Obama administration is directly blaming Iran. Republicans are urging the White House to keep the pressure on the Tehran government.


SEN. JOHN MCCAIN (R), ARIZONA: I think it's certainly a hostile act and probably meets that parameter. But whatever definition it is, it's a brazen act attempted to be carried out on American soil, and I don't think this administration has made the American people well enough aware of all of the activities. Put it in the context of all the activities of the Iranian.

REP. JOHN BOEHNER (R-OH), HOUSE SPEAKER: I think this plot is -- it's a very serious breach of international behavior. And I would hope that our administration would hold the Iranian government -- and hold their feet to the fire over the actions that have been alleged in this complaint.


BLITZER: Still not clear who if anyone within the highest levels of the Iranian government knew about the alleged scheme to murder the Saudi ambassador in Washington. The vice president, Joe Biden, says there will be serious consequences for the regime.

Let's bring in our foreign affairs correspondent, Jill Dougherty. Jill, what's the next step for the Obama administration?

JILL DOUGHERTY, CNN FOREIGN AFFAIRS CORRESPONDENT: Wolf, I can tell you here at the State Department, they are in overdrive here right now. Ambassadors, U.S. ambassadors around the world have been directed to brief the governments of the countries in which they are working about this alleged plot and to urge those governments to join with the United States to pressure Iran.


DOUGHERTY: The Obama administration's rallying cry right now -- isolate Iran.

HILLARY CLINTON, U.S. SECRETARY OF STATE: We will work closely with our international partners to increase Iran's isolation and the pressure on its government and we call upon other nations to join us in condemning this threat to international peace and security.

DOUGHERTY: But why didn't economic sanctions stop Iran from allegedly making a down payment on the plot? A Treasury Department announcement of more sanctions says up to $5 million was approved by a top figure in Iran's Quds force, part of Iran's Revolutionary Guard Corps, to allegedly pay for the plot. The complaint says Manssor Arbabsiar was able to transfer a total of $100,000 from Iran to an unnamed country, from there to a bank in New York, and finally to an account monitored by the FBI. One expert on Iran says it can be done in spite of sanctions. ALIREZA NADER, IRAN EXPERT: There are banking sanctions in place against Iran and also very broad sanctions. They can use other individuals to transfer relatively small sums of money to the United States.

DOUGHERTY: An official at the Treasury Department admits Iran is not totally cut off from the international banking system, but, they say, Treasury does not believe the foreign bank knew it was dealing with money for an assassination plot. The top Treasury Department official admitted on THE SITUATION ROOM with Wolf Blitzer that by laundering to a third country, the sanctions were circumvented.

DAVID COHEN, TREASURY UNDER SECRETARY FOR TERRORISM: The particular transmission network is something we are continuing to unravel.

DOUGHERTY: And U.S. officials say that underscores the risks financial institutions face in dealing with Iran.

VICTORIA NULAND, STATE DEPARTMENT SPOKESPERSON: We believe that all countries should look hard at how they can tighten sanctions, how they can enforce sanctions, and whether sanctions are well enforced.


DOUGHERTY: And that is why Secretary Clinton and other top officials here at the state department are burning up the phone lines talking with the leaders of ore countries and up in New York at the United Nations, Ambassador Susan Rice is meeting with all of the members of the U.N. Security Council, because the real truth is that on its own, at least economically, there really isn't a lot that the United States can do against Iran. Wolf?

BLITZER: Good point, Jill. Thanks very much.

We certainly may never know why so-called of the Iranian regime would want to kill the Saudi ambassador to the United States even if the Obama administration's claims are proven correct. A lot of unanswered questions in this case.

Let's bring in our national security contributor, Fran Townsend, the former Bush Homeland Security adviser. Some are already voicing skepticism that the evidence may turn out to be less damming to the highest elements of the Iranian government than were currently suspecting right now. What are you hearing, Fran?

FRAN TOWNSEND, CNN NATIONAL SECURITY CONTRIBUTOR: Wolf, when I speak to law enforcement sources, they say they've got the direct links into the Quds force and you know, bank transfers and the trail of the money is going to be kind of hard to deny for them, but they don't yet have the direct link.

The issue really comes down to, those of us what have been looking at this issue for the last few decades will tell you the Quds force doesn't act independent of the supreme leader. They wouldn't undertake an operation of this magnitude with these potential consequences, it's hard to imagine, without having their political leadership have approved this. Is it possible? Anything is, but the focus of the investigation right now is on what is the connection into the political leadership.

BLITZER: When you heard last night that the State Department was issues yet another worldwide terror alert, warning American citizens to be careful out there, was that time? Was that coincidental or directly related to this announcement yesterday?

TOWNSEND: That was directly related. We know that the Quds force in particular, Iran nor generally, have used proxies around the world. We've heard a lot over the last 24 hours about the attack in Buenos Aires against the cultural center and Israeli embassy in the early '90s and Beirut barracks bombings. There are a number of instances where Iran has used terrorism as a tool of their foreign policy.

But even recently we know and we've heard the information about the Quds force and Iran using proxies to attack U.S. and coalition forces in Iraq. Most recently in Syria, the Quds force has been accused of training Syrian forces that are then used against the Syrian people. This is a very active organization for the Iranian government used to project their power asymmetrically around the world working through proxies to project violence.

BLITZER: We're going to learn a lot more about this in the coming days and weeks. Fran, thank you. Meanwhile, a stunning turn of events in the trial of the so-called underwear bomber. We're going to tell you what happened today.

And the controversial deal to free an Israeli soldier and more than 1,000 Palestinian prisoners. Is Israel sending the right or wrong message? What's going on? The Israeli ambassador to the United States Michael Orrin is here this hour in THE SITUATION ROOM.


BLITZER: Jack Cafferty is here with the "Cafferty File." Jack?

JACK CAFFERTY, CNN CONTRIBUTOR: It was curious timing, Wolf, for the administration to announce the detail of that Iranian terror plot yesterday. The news conveniently took the focus of the growing scandal surrounding Attorney General Eric Holder and the federal gunrunning operation dubbed "Fast and Furious."

President Obama was reportedly briefed on the supposed terror plot four months ago in June. But the Feds chose yesterday to go public with it. When Attorney General Eric Holder was asked about being subpoenaed over fast and furious, he quickly ended his news conference on the terror plot.

Terror plot or not, the story is not going away about Fast and Furious. Congressional investigators have issued a subpoena now. They want to get their hands on communications from top Justice Department officials, including Attorney General Eric Holder. The head of the House oversight and government reform committee, Republican Darrell Issa of California, says, quote, "It's time to know the whole truth," unquote. Issa says Holder has made numerous statements about the program that have proven to be untrue. Translation -- Holder's lying. Fast and furious allowed illegal guns to walk from Arizona gun stores into Mexico. The idea was to track sellers and buyers of the guns to the Mexican drug cartels. But it all went terribly wrong when weapons found at Mexican and American murder scenes were traced back to the program. In fact, two of those guns linked to Fast and Furious were found at the scene of a murder of a border patrol agent.

Holder testified in May that he only found out about the program a few weeks before then, but Republicans point to Justice Department documents that indicate holder knew about it much, much earlier than that.

So, here's the question. Is it time now for Attorney General Eric Holder to resign over the Fast and Furious gun scandal. Go to, post a comment on my blog, or go to our post on THE SITUATION ROOM Facebook page, or write your answer on your bedroom wall.


BLITZER: Jack, thanks very much.

Meanwhile, a new twist in the case of the 2009 Christmas Day terror plot here in the United States which nearly brought down a commercial airliner in -- over Detroit, changed airport screening as we know it. Here's CNN's Deborah Feyerick.


DEBORAH FEYERICK, CNN CORRESPONDENT: In a major surprise on day two of his trial, accused underwear bomber Umar Farouk Abdulmutallab pleaded guilty to all eight charges against him, including conspiracy to commit terrorism and attempted murder. After a long recess, Abdulmutallab replied, "I plead guilty" to each count read to him by the judge.

Sounding defiant, Abdulmutallab read a statement saying he did it to avenge the death of innocent Muslims. "I am guilty of this by U.S. law, but not in the Koran," he said. He warned the United States if it continued to kill Muslims, a calamity would befall the country. "If you laugh at us now, we will laugh at you later."

Abdulmutallab's standby counsel and legal adviser Anthony Chambers spoke outside the courthouse.

ANTHONY CHAMBERS, ABDULMUTALLAB'S ATTORNEY: Pleading to something where there's a life sentence is not something I'd recommend.

FEYERICK: It's been nearly two years since the Nigerian graduate student turned wannabe suicide bomber tried to blow up Delta Northwest flight 253 with a bomb planted in his underwear. The bomb contained PETN, a compound that's been used in other Al Qaeda plots. Prosecutors were pleased with the outcome. BARBARA MCQUADE, U.S. ATTORNEY: There are other options available. There is a military tribunal system. But I believe that the civilian court system is a valid use. It's a good tool in the terrorism tool box.

FEYERICK: Passengers aboard the plane were ready to testify against him in court.

DIMITRIOS BESSIS, NORTHWEST FLIGHT 253 PASSENGER: He was guilty. He put terror in children's eyes.

FEYERICK: Bessis says he sat two rows behind Abdulmutallab.

BESSIS: We all made it.

FEYERICK: The underwear bomber now faces life in prison. His sentencing will be in January.

Deborah Feyerick, CNN, Detroit.


BLITZER: We're getting some breaking news out of Libya right now. CNN's Dan Rivers is joining us from near Sirte, Moammar Gadhafi's hometown. What are you learning, Dan?

DAN RIVERS, CNN INTERNATIONAL CORRESPONDENT: We're getting reports that the fifth son of the former leader has been captured here in Sirte. I'm being cautious about this. This is only from one single source that CNN has confirmed with so far from the revolutionary counsel in Tripoli. Here on the ground in Sirte, it's just a big rumor mill I'm afraid. There was a lot of celebratory gunfire about a half an hour ago when this flashed up on the local TV station attributed to Reuters.

We're being told he was captured around noon in Sirte. We've been in the thick of it. We didn't see him being taken out, captured, didn't hear anything either. That's why it's a little perplexing to us here on the ground. But we're being told he was captured around noon and has been taken to Benghazi, further to the east.

If this is true, clearly it's a massive boost to moral here. There were rumors swirling around that he was here directing operations, directing the military operation. He's a senior figure in the former Libyan army, a lieutenant colonel, and served as a national security adviser I believe at one point. If he has been captured, it's a great boost for this battle, which is in its final days, and we think they're being driven, the pro-Gadhafi forces, back to one tiny corner of the city with the sea behind them and nowhere to run.

BLITZER: Dan Rivers on the scene for us, good to be cautious. There have been other erroneous reports about Gadhafi's sons being captured. They turned out to be false. We'll stay on top of this story.

Meanwhile, a Syrian born naturalized American citizen is being charged with spying on Syrian protesters here in the United States and has been ordered by a judge held in custody. The suspect, who lives in Virginia, was arrested in connection with alleged conspiracy to collect video and audio recordings of those demonstrating against the Syrian government of Bashar al Assad. The indictment also says he spoke privately with the country's embattled president, all this coming amidst the brutal seven month long government crackdown still underway right now in Syria. We'll have more on this story coming up as well.

Does Israel plan to take action for the alleged assassination plot which allegedly targeted its embassy here in Washington? My interview with the Israeli ambassador to the United States Michael Orrin just ahead.

Plus, a mass outage plaguing millions of BlackBerry users in the United States and around the world. We're going to tell you what's behind it. Stay with us. You're in THE SITUATION ROOM.


BLITZER: All right, anticipation already building right now for the next faceoff among the Republican presidential candidates. CNN will host the western Republican presidential debate next Tuesday, October 18, 8:00 p.m. eastern. Listen to some of the sparring in the debate last night between Rick Perry and Mitt Romney. The subject, health care. Rick Perry pressed Mitt Romney.


GOV. RICK PERRY (R-TX), PRESIDENTIAL CANDIDATE: My question for you would be how would you respond to his criticism of your signature legislative achievement?

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: The great thing about running for president is you get the chance the talk about your experience as governor, and I'm proud of the fact we took on a major problem. We have the lowest number of kids uninsured in America. You have the highest. I'm still speaking. I'm still speaking. We have -- we have less than one percent of our kids that are uninsured. You have a million kids uninsured in Texas. Under President Bush, the percentage uninsured went down. Under your leadership it's gone up.


BLITZER: Let's bring in our chief political analyst Gloria Borger. Gloria, I think by all accounts Mitt Romney once again did a pretty good job last night.

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: He did. "I'm still speaking." How did you like that? What he did was turned a weakness, which is his Massachusetts health care plan, into an attack. When he was asked about it by Rick Perry, he was very strong about it.

I spoke with some Republican strategists today who said, look, it's become clear that if you want someone who can go toe to toe with Barack Obama in a debate, that it looks more and more like it's Mitt Romney. And again, what was interesting was he admitted that he supported for example the bank bailouts, which is not a popular position among conservatives. But he feels clearly that he's got to admit what he supports, and that if they don't like it, they can go somewhere else. But increasingly, it looks like there's nowhere else to go.

And that's why David Axelrod of the Obama campaign had a conference call with reporters today in which he took on Mitt Romney. It's clear they've moved from this primary to the general, and they think Mitt Romney is the person they're going to be running against.

BLITZER: Rick Perry's performance last night by almost all accounts, not so fabulous.

BORGER: Well, he needed really to have a good performance. He didn't have it. He was given an opportunity to lay out his economic plan. And what he did was he said, well, I have a plan on energy, and then proceeded not to give you the details of his energy plan. So this is not his best format.

And what was strange was that he had released a very brutal web ad earlier in the week about Mitt Romney, attacking Mitt Romney on health care reform, and then he seemed kind of oddly passive in this debate and let it continue kind of while he sort of sit back. So not a very strong performance.

BLITZER: And really for the first time Herman Cain came under attack.

BORGER: He did. His nine-nine-nine plan, which we heard over 20 times being mentioned, nine percent personal tax rate, nine corporate rate, nine percent national sales tax. Republicans don't like a national sales tax. They don't believe that the personal tax rate is going to be contained to nine percent.

I think Herman Cain is now in a different tier of this campaign and he's got to be able to handle these attacks better than he did last night. He also can't say things like "I have no facts to back this up, but -- " He has to start having the facts So we'll see how he does in our debate in Las Vegas.

BLITZER: Next Tuesday night, 8:00 p.m.

Gloria, thanks very much.


BLITZER: Millions of BlackBerry users not only in the United State but around the world practically on every continent are victims now to a mass three-day service outage, but now some possible, possible good news.

Let's bring in our Silicon Valley correspondent, Dan Simon. He's got the very latest.

What's the latest, Dan? DAN SIMON, CNN CORRESPONDENT: Well, Wolf, first of all, this has been a problem of the highest magnitude for RIM, the maker of BlackBerry. It appears that service is being restored to some users here in the United States, but the company has yet to put out a statement saying that the problem is over.

We should tell you that at this point, they say they don't know what the problem is. They know that there's some kind of issue with its key infrastructure, but they haven't said what has caused that outage.

I want you to listen now to what a senior manager said earlier today. Take a look.


STEPHEN BATES, RIM'S UK MANAGING DIRECTOR: Also I'd like to say that we fully understand the frustration our customers are feeling on the delays on the messaging and (INAUDIBLE) services. So I'd like to apologize to our customers who are experiencing these problems. The service issue we're dealing with we're treating with the utmost urgency and we're throwing all of our sources out to get this solved.


SIMON: Well, it looks like service is coming back online again for some users here in the United States, but this has been a PR nightmare for this company. As we all know, RIM has suffered some severe declines in its user base. They're losing to ground to Android's -- to Google's Android system and of course to Apple with the iPhone. The iPhone releasing a new version coming on Friday.

And look, if people are on the fence, they might be thinking twice about purchasing another BlackBerry product -- Wolf.

BLITZER: It's a nightmare for -- certainly for BlackBerry, for RIM, its manufacturer, but certainly for millions of people who don't have their e-mail service.

All right, Dan. We'll stay in close touch with you. Thanks very much.

When we come back, the Israeli ambassador to the United States, Michael Oren, will talk about this alleged -- alleged Iranian plot to blow up the Israeli embassy here in Washington.


BLITZER: All right. This just coming in to the SITUATION ROOM.

The Republican presidential candidate Rick Perry, he's just commented on the alleged Iranian plot to assassinate Saudi Arabia's ambassador to the United States. Listen to what Rick Perry said in Indiana just a little while ago.

(BEGIN VIDEO CLIP) GOV. RICK PERRY (R), PRESIDENTIAL CANDIDATE: Iran again has demonstrated how its engagement in the world community consists of plotting violence and terror against its neighbors and its critics. Unfortunately this is all too often business as usual for Iran.

We saw with their -- we saw what their dictators would do to their own people during the Green Revolution. We've seen what Iran does with impunity to its friends -- particularly I should say not their friends, but the friends of America. When I think about Israel. How they sow the seeds of mayhem and instability in the Middle East.


BLITZER: Governor Perry went on to say that the United States and its allies cannot allow Iran to develop or secure nuclear weapons.

U.S. officials say the Saudi ambassador was not the only target of an alleged Iranian assassination plot. They also say the suspects discussed attacking the Israeli and Saudi embassies here in Washington and possibly in Buenos Aires, Argentina, as well.

Joining us now is the Israeli ambassador to the United States, Michael Oren.

Mr. Ambassador, thanks very much for coming in.

MICHAEL OREN, ISRAELI AMBASSADOR TO U.S.: Wolf, good to be here as always.

BLITZER: What have U.S. officials told you about this alleged plot to bomb your embassy here in Washington?

OREN: Well, first of all, we very much applaud the success of American intelligence and law enforcement officials in thwarting this heinous plot. We are in close communication with them as always. And I wouldn't want to jeopardize their further investigation by going into details, but we are in close communication.

BLITZER: But was this a serious plot? Was it just a little talk? Were there actual plans to go to your embassy and blow it up? What can you tell us?

OREN: Well, you can never underestimate the Iranian regime. This is the Iranian regime which is -- which is to get killing American soldiers in Iraq, whose president appeared before the general assembly a month after 9/11 and blamed the United States for destroying the twin towers, and has killed American servicemen in Saudi Arabia and just about everywhere.

And this is the Iranian regime that supports Hezbollah, Hamas, that has fired thousands of rockets at Israelis and killed hundreds of Israelis through suicide bombers. We can never be anything but vigilant and take these threats very, very seriously.

BLITZER: But was it just talk, very preliminary stage, or was there an actual blueprint based on the information you're getting? How serious -- how advanced was this alleged attempt to blow up the embassy?

OREN: We take it very seriously, Wolf. We take it very seriously and we take the steps in accordance with that seriousness. We are always on alert. We're very vigilant. Here in Washington as we are in Israeli where again these thousands of Iranian supplied rockets in the hands of Iranian-backed terrorists are aimed at our neighborhoods and our homes.

BLITZER: Because the Iranian government flatly denies all of these allegations. They accuse the Obama administration of fabricating all of this and they say there's absolutely no truth to any of it.

OREN: Just like they denied blowing up the Israeli embassy and the Jewish community center in Buenos Aires that killed over 100 people, they're always going to deny it. But we know that Iran is the world's leading supporter of terror and we have to take everything seriously. When the Iranian leaders say they're going to wipe Israel off the map, when they say they're going to try -- they're developing nuclear power, we have to take it seriously. They're doing all this without nuclear weapons, Wolf. Imagine what they'd do -- what they would do if they haven't --


BLITZER: So the Obama administration is trying to ratchet up sanctions against the Iranian government. What is the Israeli government planning on doing in the aftermath of this alleged plot?

OREN: Well, we support the president's plan on sanctions. The sanctions have taken a big chunk out of the Iranian economy. We haven't seen that the sanctions have dampened the Iranian leader's appetite for terror or for nuclear power, and our position and the position of the United States of America, is that all options are on the table. And we --

BLITZER: Including the military options?

OREN: All options are on the table and we want people in Tehran who are sponsoring this terror, who are trying to build nuclear weapons, we want them to believe us when we say that all options are on the table.

BLITZER: Sanctions, really -- let's be honest, haven't really stopped the Iranians by any means, have they?

OREN: As I said, they've taken a big chunk out of the economy, they've taken a big chunk out of the Iranian currency. They're causing them real pain. We want to be able to see that it's actually effectively deterring them either from sponsoring terror but particularly from pursuing nuclear weapons.

BLITZER: Let's talk about this other story that's developing, a huge story, a major controversy in Israel, this prisoner exchange between your government, the government of Prime Minister Benjamin Netanyahu and Hamas, an organization you consider to be a terrorist organization. Yet Prime Minister Netanyahu is negotiating with Hamas for the release of an Israeli soldier Gilad Shalit. He's been held, what, for five years by Hamas. And you're about to release a thousand or so Palestinian prisoners in change for Gilad Shalit?

OREN: Well, first of all, keep in mind, it's not just Israel that lists Hamas a terrorist organization. It's also the United States, it's the European Union, the international community considers for the most part Hamas to be a terrorist negotiation. And we're not negotiating with Hamas, we're negotiating through the good offices of the Egyptians and the Germans. And we're very appreciative of their contributions to this.

Listen, it's a tough call. And Gilad Shalit is a soldier. You know in Israel, we have a citizen's army. We all have kids in the Army. I've had three kids in the army now. And Gilad Shalit is like a son to each and every one of us. And our soldiers have to know that when we send them out to the field of battle, to risk their lives for us, they have to know that if, God forbid, they fall captive, that the state of Israel is going to do everything in its power to try to get them back.

It's a hard call. We know that by releasing terrorists we're taking a terrible risk, but we also know that we have a contract with our soldiers that we're going to do the utmost to get them back and Gilad Shalit literally is like our son.

BLITZER: But some of these prisoners that you're about a release have blood on their hands. They're convicted of killing Israelis and terrorist actions. Don't you think the families of those victims are going to be upset about all of this releasing these prisoners?

OREN: Undoubtedly. And again it's a hard call for Prime Minister Netanyahu to make. But look, it was a brave call, it was a strong call. He has to go out and face those families. Not an easy -- not an easy thing to do, but he has to do this in order --

BLITZER: Doesn't this encourage the taking of more Israeli so-called soldiers to plan for down the road for more of these kinds of swaps?

OREN: Well, there have been attempts to kidnap Israelis over the course of many decades now. And we know that they're always trying and we have to be very aware and very sensitive to it and our soldiers and our civilians are all instructed to take the necessary precautions. And they haven't succeeded for the last five years, though they've tried many, many times.

Again, we live in a tough neighborhood and our soldiers have to know that when they go out to fight for us, we're going to be right behind them with everything we have.

BLITZER: When is this exchange going to happen?

OREN: The next few days. Again I can't go into details about it, but we hope to have Gilad home soon, reunited with his family. Early as possible. BLITZER: And these Palestinian prisoners would go to Gaza, is that what would happen?

OREN: Some would go away from Gaza, not be actually returned to their homes. Some of them would actually be sent abroad.

BLITZER: Sent abroad.

OREN: That's the deal.


BLITZER: And this wouldn't be the first time you've had a lopsided swap like this in Israel's history.

OREN: Well, it's lopsided because we value human life. That's what we're about. As I say, we care about our citizens, we certainly about our soldiers, about our children. That's what distinguishes us from the terrorists. They say they honor death and we honor life, well, I'll second that. It's absolutely true.

BLITZER: Mr. Ambassador, thanks for coming in.

OREN: As always.

BLITZER: Appreciate it.

A congratulatory message from the man who replaced Osama bin Laden. It may surprise you who the new leader of al Qaeda is praising. Stand by.


BLITZER: The chair of the Senate Intelligence Committee, Senator Diane Feinstein, is speaking to reporters right now. She's just been briefed by the Obama administration on the latest on the alleged Iranian plot to kill the Saudi ambassador.

Let's listen in briefly.

SEN. DIANE FEINSTEIN (D), CALIFORNIA: I think we need to explore whether there are other plots going on into other countries -- in other countries.

UNIDENTIFIED REPORTER: Do you know if the administration is actively exploring other --

FEINSTEIN: Well, I do know that intelligence indicates that there may well be problems elsewhere. And I think we need to look at that.


UNIDENTIFIED REPORTER: Is there any specific --

FEINSTEIN: I can't go into it.



FEINSTEIN: I'm not saying any of that. Not saying that. All I'm saying is -- this is a very unusual thing. And because it's unusual, because it's Quds force, because it's Revolutionary Guard, two agencies very high on the hierarchy of the Iranian government, you've got to think if they're going after a Saudi ambassador here, what about a Saudi ambassador there or an Israeli ambassador there or an American ambassador.

And so I think that we should all be alert to that. But I'm not saying there is a broader plot. I'm just saying we need to look that. At that.

UNIDENTIFIED REPORTER: Possibilities against the United States towards its -- these tensions between Iran and Saudi Arabia that playing out of fear.

FEINSTEIN: Well, clearly, the target was the Saudi ambassador here, so you can say, well, why not the Saudi ambassador somewhere else? I can't answer that. It may well be to say look, United States, we can do this right in your midst. I don't know. I simply is what it is.

UNIDENTIFIED REPORTER: And can I ask you, what do you think the U.S. response should be to this? Should it go beyond diplomatic sanctions, economic sanctions? Or should --


FEINSTEIN: Well, I will tell you this. I think from what I heard and it's up to the administration to give you the particulars, I can't. But I think there is already various responses taking place diplomatically, through Treasury, and I think the administration has moved very rapidly.

UNIDENTIFIED REPORTER: Senator, is a military response appropriate at this point?

FEINSTEIN: I don't think so. No. I don't believe it is. I think the administration is really taking some strong actions with Treasury, diplomatically, and we will see what fruit those bear in the coming weeks.

UNIDENTIFIED REPORTER: And there's no indication from them that they are considering military aspect response?

FEINSTEIN: No, none that was mentioned. OK? Thank you.

BLITZER: All right. So there she is, Dianne Feinstein, the chair of the Senate Intelligence Committee. She just emerged from a briefing with the Obama administration officials on this alleged Iranian plot to kill the Saudi ambassador here in Washington.

Much more of the coverage right after this.


BLITZER: For the first time ever CNN is polling -- CNN polling is revealing that fewer Americans favor the death penalty over a life sentence as punishment for a murder charge.

According to our new CNN/ORC poll, 48 percent now say the death penalty is appropriate. That's compared to 53 percent back in 2009, 56 percent in 2005.

Let's get right back to Jack for the "Cafferty File." Jack.

JACK CAFFERTY, CNN CONTRIBUTOR: The question this hour, is it time for the Attorney General Eric Holder to resign over the "Fast and Furious" gun scandal?

David in Virginia writes, "Obama's Cabinet and staff seem to be filled with people with their own political and social agendas, the EPA, Justice, Energy, and the list goes on. The president would be better served taking this opportunity to clean up his act. Holder has done more than enough to warrant winning the race to the door."

Danny in Sacramento writes, "Get real. In a country where Wall Street robber barons don't go to prison for plunging the global village into the great recession, do you really think the U.S. attorney general is going to take the fall for a little messed-up gun running? It's the old story, isn't it? Either Holder is incompetent or he's lying. And neither of these offenses rises higher than a hill of beans post Iraq. Rhetorically speaking how many of George W. Bush's administration went to the slammer for BS-ing us into that little misadventure?"

Tammy on Facebook writes, "It's his watch. Holder is responsible. How does something like that happen and the man in charge is clueless? It should be investigated and Holder should be fired."

Dan in Pennsylvania writes, "It's often said justice is lying. That ranks right up there with someone claiming to be patriotic in order to get out of trouble. Perhaps it's time for Holder to resign and be replaced with an attorney general who has better vision."

And Kevin in Virginia, "The fact that weapons were used for various purposes would have been no surprise to Holder and company and surely must have been seen as an acceptable risk. The bad guys will get guns from somewhere, so why not put some out there that we can track for the purpose of taking the war on drugs and the cartels to the next level."

And Cliff writes, "Yes, he ought to resign, right after Cheney goes to jail."

If you want to read more on this, go to my blog,, or through our posts on THE SITUATION ROOM's Facebook page.

BLITZER: See you tomorrow, Jack. Thank you.

Desperate call to 911 for help from a corn maze. Jeanne Moos is next.


BLITZER: Panic and desperation in a sea of corn. Here's CNN's Jeanne Moos.


JEANNE MOOS, CNN SPECIAL CORRESPONDENT (voice-over): You're lost in a giant cornfield maze. You don't know which way to turn. Darkness is falling. Who you going to call? 911.

You would think that she was being stalked by the corn. A Massachusetts woman, her husband and two kids got lost and called Danver's police an hour after the 6:00 p.m. closing time at the Connor's Farm Maze and we all know from the movies how spooky cornfields can get. Especially after dark. When you fall into the clutches of demonic corn, actually, the killer corn wasn't attacking but --

UNIDENTIFIED FEMALE: The mosquitoes eating us alive.

MOOS: Some folks celebrate getting lost. Oh, yes?

UNIDENTIFIED FEMALE: We thought this would be fun. Instead it's a nightmare.

UNIDENTIFIED 911 DISPATCHER: Can I talk to your husband?

MOOS: The dispatcher told the man to yell to the canine unit that was arriving at the maze to look for the lost family.



MOOS (on camera): At one point the lost dad took the dispatcher so literally he even repeated literally the "say."

UNIDENTIFIED 911 DISPATCHER: Say it again so he -- because he can't see you so say, hello, K-9.


MOOS: Hello, K-9. Hello, K-9. It took a total of at least 10 "Hello, K-9s".

UNIDENTIFIED MALE: Hello, K-9. Hello, K-9.

UNIDENTIFIED 911 DISPATCHER: Keep going, sir. Gives them something to do.

UNIDENTIFIED MALE: Hello, K-9. Hello, K-9.

MOOS (voice-over): Finally towards the end of the 7 1/2 minute call --

UNIDENTIFIED FEMALE: We see a light. MOOS: The K-9 unit officer said he found the family about 25 feet from the entrance, if they get this lost in a corn maze, the next thing you know they'll be calling 911 from the maze at IKEA.

UNIDENTIFIED FEMALE: It's embarrassing.

MOOS: The manager of the farm offered the couple free tickets to come back again.

UNIDENTIFIED MALE: They didn't answer but their faces went --


MOOS: The maze depicts an image of a headless horseman but compared to the lost couple, the horseman kept his head.

Jeanne Moos.




MOOS: New York.


BLITZER: That's it for me. Thanks very much for watching. I'm Wolf Blitzer.