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Interview With Utah Congressman Jason Chaffetz; Sweetheart Deals for Congress on Mortgages?; Mitt Romney Under Fire; Scientology at Fault for Cruise Divorce?; Man Dies in Court in Apparent Suicide

Aired July 5, 2012 - 22:00   ET


ANDERSON COOPER, CNN ANCHOR: Good evening, everyone. It's 10:00 here on the East Coast.

And we begin tonight "Keeping Them Honest" with allegations that a whole bunch of members of Congress and their staffers got sweetheart deals on personal home mortgages, deals that most Americans had no chance of ever getting, that is, unless you knew the right people.

A new report out today focuses on allegations that the failed mortgage lender Countrywide Financial gave special treatment to the very senators and congress members and their staffers who were supposed to be regulating them and the rest of the lending industry.

Today's report is by the House Oversight Committee. And it details how this guy, Countrywide CEO Angelo Mozilo, oversaw the program giving a lot of people on Capitol Hill this preferential treatment. It was called, fittingly, the Friends of Angelo program.

Now, the report today names a string of lawmakers and regulators from both parties, Democrats and Republicans, who benefited from this VIP treatment, Senate Budget Committee Chairman, for instance, Democrat Kent Conrad, former Democratic Senator Chris Dodd, Republican House Armed Services Committee Chairman Buck McKeon.

All three, by the way, deny any wrongdoing. The report also says the former CEO of home loan giant Fannie Mae, officials at Freddie Mac and a secretary of housing and urban development were also in this Friends of Angelo program. So were congressional staffers from both parties who played a role in legislation which affected Countrywide.

Now, these VIPs, as I said, got favorable mortgage rates and points. One, a Democrat, Edolphus Towns, was a former chairman of the House Oversight Committee, the very same committee investigating Countrywide. He also denies any wrongdoing.

According to the House report, "Documents and testimony obtained by the committee show the VIP loan program was a tool used by Countrywide to build goodwill with lawmakers and other individuals positioned to benefit the company." The report went on to say that the effort, well, it worked.

There's a lot to talk about. Joining me tonight is Jason Chaffetz, Republican of Utah.


COOPER: So, Congressman, I think a lot people will be very upset to realize that politicians and their staffs were getting these sweetheart deals from a company that was actually lobbying them.

In your opinion, did anyone here commit a crime?

REP. JASON CHAFFETZ (R), UTAH: Well, there was no quid pro quo. We could not directly tie somebody's vote directly to getting this benefit as the report points out.

But, boy, it skirts awfully close. You're given a benefit to something that your friends and neighbors or somebody off the street wouldn't be able to get because they were members of Congress or because they were working for members of Congress.

COOPER: What I found amazing in your report is that according to the report, these sweetheart deals basically came about because so many congressional staffers were actually complaining to the Countrywide lobbyists about their own personal loans, and so the lobbyists sort of spent the first 30 minutes of meetings dealing with people's personal complaints. That just seems outrageous to me.

CHAFFETZ: It does, particularly when you're on the committees that are charged with maybe tightening up the rules and regulations, because we were dealing with all these bad loans and whatnot.

And these people, they were complaining about them, but then -- so they took this program, internal program and they called it Friends of Angelo and decided to go ahead and start helping these people. And it's just wrong. It didn't smell right, didn't look right because it wasn't right.

COOPER: It would be as if I went to interview the head of Countrywide and I spent the first 30 minutes of the interview or before the cameras are rolling complaining about my personal mortgage to the guy and then get directed to some program. I would be fired for that.

CHAFFETZ: Look, they were put -- a little bait was put out in front of these people and unfortunately a number of them bit on both sides of the aisle. Key, important people, they bit at this stuff. Some claim that, well, they didn't really understand what they were doing, but that doesn't seem like much of a defense to me.

COOPER: Yes. A lot of the members of Congress claim they never knew they were part of any preferential program. Are they lying? Do you have any proof that they did in fact know they were?

CHAFFETZ: Could not directly tie that.

This investigation lasted some three years. Again, people on both sides of the aisle. But this was something you couldn't just pick up the phone or go down to your local Countrywide representative and get. You could only get it by dealing with the Friends of Angelo. And it seems obvious to me. But I don't know. COOPER: Yes, the Senate Budget Committee chairman, Kent Conrad, said to Politico that the Senate Ethics Committee concluded unanimously he didn't receive any sweetheart deal on any transaction.

Your report, though, alleges that he did, that he saved something like $20,000 through two preferred loans. So did the Ethics Committee get it wrong in the Senate?

CHAFFETZ: Well, the Ethics Committee in general is fairly impotent. Usually, it's -- the voters have to deal with this and make these types of decisions.

What we could not directly tie was, hey, you got this sweetheart deal in exchange directly for this particular vote or for changing a piece of legislation. We could never directly tie those two together, but you can see what the consequences were. The taxpayers ended up footing all of these bills. And at the same time, some of the key people on Finance and Banking and the key staffers, one term that was used is this person has the pen in hand.

That is, they were a staffer that was actually helping to write this piece of legislation. You can understand why when this lobbyist said to the committee this is why this person was targeted, you can see that there was there was an attempt here to influence.

COOPER: The report now concludes that Congress should consider making it illegal for companies to offer discounts or other types of preferential treatment to members of Congress or their staff. I think most people would say that seems like common sense. Do you expect that is actually going to happen, though?

CHAFFETZ: Well, as you said, it's very difficult to legislate common sense.

And, look, it is already inappropriate and illegal for a member of Congress to accept something that they wouldn't otherwise be able to get.

So I don't understand why the Ethics Committee thinks that there's nothing. Here in the House,I think there's still some outstanding issues. But it was wrong. It doesn't look right, it doesn't smell right because it wasn't right, Anderson. And I'm glad that we did this report and hopefully it sheds more light on the issue.

COOPER: Yes, I'm glad you did it too. And again as you point out, this is folks on both sides of the aisle here, Republicans and Democrats, involved in this.

Congressman Chaffetz, I appreciate your time. Thank you.

CHAFFETZ: Thanks, Anderson.


COOPER: Well, we mentioned at the top that all lawmakers named in the House report today deny any wrongdoing. Former Senator Dodd's spokesman sent us a statement reading -- quote -- "This report recycles old allegations that Republicans and Democrats on the Senate Ethics Committee investigated for 14 months before concluding that Senator Dodd did nothing wrong."

It went on to say, "The Senate Ethics Committee found that the rates and terms Senator Dodd received were widely advertised and available to other borrowers. When questions were first raised about his loans, Senator Dodd was clear in saying he became a Countrywide customer back in 1999, something noted on the first page of the Senate Ethics Committee's report."

Senator Conrad also denies that he received preferential rates. Now, in all we heard from six of the seven lawmakers named in the House report. You can find their statements right now at

Let us know what you think about this. Follow me on Twitter @AndersonCooper talking about it right now on Twitter. I'm tweeting in the hour ahead.

A lot more happening tonight also, including Mitt Romney's latest newest position on health care reform. He's now in line with his own party, but big-name supporters have some doubts about his campaign. That's next.


COOPER: "Keeping Them Honest" tonight on the campaign trail on Mitt Romney's latest attempt to paint President Obama's health care reform law as bad and his own Massachusetts plan as good.

Since the Supreme Court ruled last week, Governor Romney and members of his campaign have seemingly tied themselves in verbal knots over it. Ironically, though, the Supreme Court offered him a way out, upholding the mandate that people buy health insurance on the basis that the penalty for not buying insurance is a tax. That's what the court said.

Most Republicans took that ball and ran with it. Take a look.



REP. MICHELE BACHMANN (R), MINNESOTA: Obamacare is the biggest tax increase in American history.

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: The government could decide that we're going to tax you if you don't eat broccoli on Tuesday.

REP. CATHY MCMORRIS RODGERS (R), WASHINGTON: In fact, the Affordable Care Act is a tax. It is the largest tax in America's history.

SEN. MARCO RUBIO (R), FLORIDA: Middle-class tax increase.

GOV. BOB MCDONNELL (R), VIRGINIA: It's the largest tax increases on the middle class in history.

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: Obamacare raises taxes on the American people.


COOPER: It's actually nowhere near the biggest tax increase in history.

But all the same, according to the court, it is a tax. So there was a minor political tremor when Romney's campaign chief bucked the party line and said this.


QUESTION: The governor does not believe the mandate is a tax; that's what you're saying?

ERIC FEHRNSTROM, SENIOR ROMNEY CAMPAIGN ADVISER: The governor believes that what we put in place in Massachusetts was a penalty and he disagrees with the court's ruling that the mandate was a tax. But again...


QUESTION: So he agrees with the president, but he agrees with the president that it is not -- and he believes that you shouldn't call the tax penalty a tax; you should call it a penalty or a fee or a fine?

FEHRNSTROM: That's correct.


COOPER: Now, that is totally consistent with then Governor Romney's thinking back in 2006. But, as we pointed out, it's totally out of step with his own party right now, and he got blasted for it. So, Tuesday, he changed his position.


MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: The Supreme Court is the final word, right? Isn't that the highest court in the land? And they said it was a tax, didn't they? So it's a tax, of course, if that's what they say it is.


COOPER: So if Romney is now saying it's a tax in the Obama plan, that notion raises the inevitable question, which CBS News' Jan Crawford asked.


QUESTION: Does that mean that the mandate in the state of Massachusetts under your health care law also is a tax and that you raised taxes as governor?

ROMNEY: Actually, the chief justice in his opinion made it very clear that, at the state level, states have the power to put in place mandates. They don't need to require them to be called taxes in order for them to be constitutional. And, as a result, Massachusetts' mandate was a mandate, was a penalty. It was described that way by the legislature and by me.


COOPER: So Mitt Romney yesterday denying that the penalties in Massachusetts amounted to a tax, just as he did back in 2006. What's interesting is that that's not how he described them when he was running for president back in 2008.


UNIDENTIFIED MALE: You imposed tax penalties in Massachusetts.


ROMNEY: Yes. We said, look, if people can afford to buy it, either buy the insurance or pay your own way. Don't be free riders.


COOPER: So he seemed to agree that then they were tax penalties in 2008. He says they were fees in 2006 and a straight-up mandate today.

Now, as we mentioned, all the differing are versions are causing a lot of consternation from some of Romney's supporters, including Rupert Murdoch and former General Electric CEO Jack Welch. They're calling for a Romney campaign shakeup.

Murdoch tweeting -- quote -- "Met Romney last week. Tough O. Chicago pros will be hard to beat unless he drops old friends from team and hires some real pros. Doubtful."

And in today's Murdoch-owned "Wall Street Journal" an editorial with the following lead -- quote -- "If Mitt Romney loses his run for the White House, a turning point will have been his decision Monday to absolve President Obama of raising taxes on the middle class."

Let's talk about it now with's Erick Erickson. He's with us tonight. So is Rick Santorum and Michele Bachmann 2012 spokeswoman Alice Stewart, also senior political analyst Ron Brownstein.

So, Erick, where does this clarification get Romney exactly? Because it certainly doesn't help him with the folks who are worried that he's a flip-flopper, does it?

ERICK ERICKSON, CNN CONTRIBUTOR: No, and that's the problem. I think the Romney campaign doesn't want to be seen as a flip-flopper, so they want to be careful how they do it.

But sometimes you can be so careful you trip over your feet. That's what's happening here. He just needs to go on and say it's a tax. It didn't work well for him in the primary campaign to say, well, it was Massachusetts and states could do something the federal government can't do. He might as well just go on and say, yes, it's a tax. The individual mandate is a tax.

Anderson, I do have to take one issue, when you said it wasn't the largest tax increase in history. Remember that the CBO window only looks at 10 years. And the individual mandate doesn't start for a few years. If you actually move the CBO window to when the individual mandate starts and when it goes into complete effect, it is the biggest tax increase in American history.

COOPER: OK. Point taken.

Alice, though, one of your former bosses, Rick Santorum, who lost the GOP primary obviously to Mitt Romney, said Romney would not be able to make the argument against Obamacare so-called because of his own similar plan in Massachusetts. So was Senator Santorum right? Is that what's going on here?

ALICE STEWART, FORMER SANTORUM CAMPAIGN SPOKESWOMAN: No. There is a tremendous difference between what was instituted in Massachusetts. They have the power to do that in the states.

And Governor Romney made it very clear...


COOPER: So you're saying it was not a tax in Massachusetts?

STEWART: It was a mandate.

He made it very clear in his interview with Jan Crawford. He said while he agrees with the dissent, the Supreme Court has ruled. The majority ruled that it is a tax. Like it or not, it's a tax.

Now, the real question should go to President Obama. He's the one that's come full triangle on this when he was thinking...


STEWART: Just a second.


COOPER: But wait. Are you saying he flip-flopped, though? Because it seemed like earlier in the week he wasn't -- or at least according to his spokesperson he wasn't thinking it was a tax.

STEWART: What Governor Romney said clearly is that he agrees with the dissent, but like it or not the Supreme Court has ruled. That's the final rule. But it will come down to the voters in November as to the court of public opinion.

But, as I said, it's very important also to look at where President Obama has stood on this. While seeking passage, he promised the American people repeatedly this was not a tax. Yet he sends his attorney to the Supreme Court arguing that it was a tax. Now he's saying it is not a tax. So he's the one that's come full triangle on this issue.

COOPER: Ron, it's one thing when the arrows are coming from Democrats. The fact that they're coming from conservatives and some extremely prominent conservatives, no less, how much trouble does this spell for Romney?

RON BROWNSTEIN, CNN POLITICAL ANALYST: It's kind of a week that has your head spinning.

And despite what Alice said, I think it does kind of underscore the validity of Rick Santorum argued, that it's very difficult for Romney to draw contrasts with Obama on this one particular issue.

Certainly, what they did in Massachusetts, it would pass a DNA paternity test for how the mandate was structured at the national level. The Romney mandate is enforced through the tax code. The penalty for not buying health insurance in Massachusetts is actually double what it is at the national level.

And in fact most people, Anderson, choose to buy health insurance in Massachusetts. Only 44,000 people in the latest year are subject to the mandate, which is worth keeping in mind here. What Justice Roberts said was a tax was not the mandate, per se. As you noted correctly, it's the fine on people who choose not to buy health insurance under the mandate with help from the government.

The best estimate is that would only apply to about four million people, so it's hard to see how this would be the largest tax increase in history if we're talking only about four million people who might choose not to buy the health insurance with help from the government and pay the fine or tax instead.

COOPER: Erick, is the danger -- does it matter at this point if people say Romney is a flip-flopper on this? You're saying it's more important that he -- that he basically embrace this idea that it's a tax?

ERICKSON: Just say it's a tax. Listen to this conversation. In Massachusetts, it's a mandate. In the federal government, it's a tax. But at the federal level, we have all been talking about it as an individual mandate. But an individual mandate at the federal government is a tax. And it's not -- is it a leprechaun or is it a little person?

What's the difference? It's the same thing. It's a tax.


ERICKSON: He might as well as embrace it as a tax, admit that Massachusetts did it and say Barack Obama has done an even bigger tax and then say he's going to get rid of it. He compounds the problem with conservatives who don't trust him.


COOPER: But, Erick, hasn't he been saying all along that he didn't raise taxes in Massachusetts? And if he's saying this was a tax...

ERICKSON: That's the problem.


COOPER: There you go.


ERICKSON: He can say, hey, Justice Roberts decided it was a tax.

STEWART: But the important thing to note is that Governor Romney says, like it or not, the Supreme Court has ruled. It's the law of the land. It is a tax.


COOPER: Right. But earlier in the week, he didn't seem to believe that, or at least according to his spokesman.

STEWART: Well, as I said, what Governor Romney clearly stated is he has agreed with the dissent, which is exactly what Fehrnstrom said.

But the Supreme Court has ruled. It's the law of the land. But in the court of public opinion, that will be decided in November as to overturning this law. But it's also important to point out too what Governor Romney wants to do is he wants to completely do away with this.

He wants to institute free market policies on health care. He wants to take the government out between the patient and their doctors, and he wants to make sure that people have more freedom and choice in their health care and that's what he will do on day one.


BROWNSTEIN: Yes, I was going to say...


BROWNSTEIN: I think this does create a challenge for President Obama.

As they have tried to defend the health care law intermittently since its passage, they have focused mostly on somewhat peripheral issues, like letting your kids stay on your insurance until you're 26. I understand that's important for people who it affects. But it's not the biggest part of this.

The central idea here is they need to explain what the logic behind the mandate is, why Mitt Romney adopted it in Massachusetts, why Arnold Schwarzenegger tried to do it, another Republican governor in California, the argument that the only way to do the insurance reforms that are popular is to bring more people into the risk pool by requiring those who don't have insurance and can afford it to buy it with in most cases substantial government help.


STEWART: But, Ron, it's also important to note that Governor Romney made it clear his plan was the Massachusetts plan. It wasn't a one- size-fits-all plan. It fit for Massachusetts. It's not something that should go across all 50 states.


BROWNSTEIN: The logic is the same, Alice.


BROWNSTEIN: But the underlying logic is the same.

The exact argument that Romney has made -- and we can play the tape of him many times talking about free riders and the need to bring people into the system to broaden the risk pool, which allows you to do the insurance reforms that are popular with the public, that is a case Obama has never really, I think, successful tried to make. He's focused on things that seem a little easier to defend, and that has been a failure.

At various points, they have had almost half the country saying this is good for the country overall. They have never gotten a majority saying this is good for me and my family. And as long as that's true, it will be more a negative than a positive for him in the election.

COOPER: Erick, is it going to boil down -- Governor Romney, whatever his position may have been and is now, the fact is he wants to eliminate this program. This is what he is saying. Is that a winning issue for him? How much of a winning issue do you think that is?

ERICKSON: Yes, look, even in CNN's latest poll, a majority of Americans, over 50 percent, at 51 in CNN's poll -- and the average is about a 10 percent gap -- want the individual mandate repealed, want Obamacare in its entirety repealed.

So he's got a winning issue there if he focuses on that and if he tells people he's going to repeal the whole thing. Whether it's a tax or a mandate doesn't matter because he's going to repeal it.

But this saying it's a mandate in Massachusetts and a tax at the federal level, people in Des Moines or Toledo, they don't understood the nuance and the federalism between what a state can do and the national government can do. They might as well just bite the bullet and say it's a tax, but it doesn't matter because it's going away under Mitt Romney.

COOPER: Erick Erickson, appreciate you being on, Alice Stewart as well, Ron Brownstein. Thank you very much.

STEWART: Thank you.

COOPER: Colorado's massive wildfire forced them from their homes. So what happens now to all those pets that have been left behind? That's next on the program.


COOPER: The most destructive fire in Colorado's history is now nearly contained. The Waldo Canyon fire spread so fast, it forced thousands of families to flee their homes. Look, the pictures are just unbelievable. The flames destroyed close to 350 homes.

For those who live there, now is the time they have to start all over. Others are returning to their neighborhoods to try to pick up the pieces and resume life as best as they can or at least figure out a new kind of normal.

The future is far less certain though for pets lost in the shuffle.

Gary Tuchman has their story.


GARY TUCHMAN, CNN NATIONAL CORRESPONDENT (voice-over): At the intersection of Animal Afternoon and Bark Avenue, they are just hanging out in wait, the pets temporarily left behind when the Colorado wildfire spread rapidly.

JAN MCHUGH-SMITH, HUMANE SOCIETY: We knew right away that evacuees were going to start coming to us.

TUCHMAN: Jan Mchugh-Smith is the president and CEO of the Humane Society of the Pike's Peak region in Colorado Springs.

MCHUGH-SMITH: In total, we cared for 439 animals.

TUCHMAN: Most of the pets have now gone back to their families with the evacuation orders lifted. But some still remain, dogs like 9- year-old Hunter and 7-year-old Phoebe, cats like 5-year-old Pippen and 2-month-old Marilyn, given that name despite that she is really a he.

And what a variety of wildfire visitors there are. Meet Scooby, a 5- year-old female turtle. Snowflake, the parakeet, sitting quietly by Scooby. There is also an unnamed but very large rabbit, and an unnamed and very camera-shy guinea pig.

And last, but certainly not least, there's Bingo the goat. Most of these animals aren't abandoned or lost. They just remain until their owners can get back to their old homes, or their new homes.

(on camera): There's great relief here that most of these pets have gone back to their families, but also the realization that if the fires flare up again, these cages could be full again.

(voice-over): Veterinarians are taking care of the remaining pets. They say the animals are going through stress, just like their owners.

DR. HEATHER BECKER, VETERINARIAN: All this is very new to these animals. They don't know the people around them. They're surrounded by other animals. It's an extremely stressful situation for them. TUCHMAN: Indeed, among the stressed, these three hens, not at all happy to see our cameras, but they're about to have a happy reunion.

See, Cindy Cabrera (ph) had to evacuate her ranch quickly when the fire came, but now she's coming back.

UNIDENTIFIED FEMALE: How you doing, baby? Want to go home? Want to go home?

TUCHMAN: Going back with her chickens.

UNIDENTIFIED MALE: Thank you very much.

UNIDENTIFIED FEMALE: And they got a lot of good loving while you were away.

UNIDENTIFIED MALE: I'm sure they did, without question.

TUCHMAN: It's a day of a lot of smiles for people who haven't had a lot to smile about.

Gary Tuchman, CNN, Colorado Springs, Colorado.


COOPER: Well, nice to see them reunited.

Randi Kaye joins us now with a 360 bulletin -- Randi.

RANDI KAYE, CNN CORRESPONDENT: Anderson, WikiLeaks says it's releasing millions of e-mails exposing inner workings of the Syrian government. The whistle-blower Web site claims the messages dating back to 2006 came from politicians, government ministries and companies working with them.

One e-mail shows an Italian company trying to get around U.S. sanctions on Syria.

The judge in the Trayvon Martin case setting bond for George Zimmerman at $1 million. This comes after he revoked Zimmerman's original bond for failing to disclose more than $150,000 raised from supporters.

The captain of the wrecked Costa Concordia cruise ship can now leave his home, but he is far from free. A judge released the captain from house arrest, but says he can't leave his town near Naples. At least 30 people died when the ship struck rocks and turned on its side last January.

And gone in a flash, a glitch causing San Diego's entire fireworks show to launch at the same time. Organizers promised a choreographed 20-minute show.

Instead, Anderson, it lasted just 15 seconds.


I have seen this video a couple times today. It's so -- I feel so bad for the folks who had probably lined up watching that.

KAYE: No kidding, right?


KAYE: You always wait for the finale, and then you got it all at once.


COOPER: Yes. It was an amazing display in New York last night.

Randi, thanks. We're going to check back with you a little bit later on.

More tonight, does Tom Cruise's Scientology faith have anything to do with the breakup of his marriage? We'll take a look at his role in the Church of Scientology, next.


COOPER: Beefing up security ahead of the Olympic games. That and a terrorist arrest. The latest from London when we continue.


COOPER: Well, a lot of news Web sites are buzzing over Katie Holmes' decision to file for divorce from Tom Cruise after five and a half years of marriage. There's been a lot of coverage about whether her husband's affiliation with the Church of Scientology played a role in the actress's decision to end her marriage.

Holmes and Cruise have a daughter together, 6-year-old girl named Suri. Tom Foreman tonight takes a look at Tom Cruise's role in the Church of Scientology.


TOM FOREMAN, CNN CORRESPONDENT (voice-over): When it comes to Scientology, Tom Cruise may well be the faith's most famous combative celebrity defender, famously tearing into NBC's Matt Lauer over the church's repudiation of psychiatry.

TOM CRUISE, ACTOR: Do you know what Adderall is? Do you know Ritalin? Do you know now that Ritalin is a street drug? Do you understand that?

MATT LAUER, CO-HOST, NBC'S "THE TODAY SHOW": The difference is this was not against her will, though.

CRUISE: Matt -- Matt, I'm asking you a question, Matt. I'm asking you a question.

LAUER: I understand there's abuse of all of these things.

CRUISE: No, you see here's the problem. You don't know the history of psychiatry. I do.

FOREMAN: Although Cruise joined Scientology in the 1980s, over the past decade his public identification with the group has been much more pronounced. He's explained his beliefs on talk shows, in the press.

And Scientology meetings featuring Cruise with his "Mission: Impossible" theme playing in the background and the star giving a military salute to a Scientology leader have appeared in videos like this one posted by RadarOnline.

CRUISE: I think it's a privilege to call yourself a scientologist, and it's something that you have to earn, and -- because Scientology does. He or she has the ability to create new and better realities and improve conditions.

FOREMAN: Many of Cruise's statements underscore a central lesson of the faith, this its followers can accomplish great things. Again, RadarOnline.

CRUISE: When you drive past an accident, it's not like anyone else. If you drive past, you know you have to do something about it, because you know you're the only one that can really help. I won't hesitate to put ethics on someone else, you know, because I put it ruthlessly on myself.

FOREMAN: Such talk echoes teachings laid out in the 1950s by the faith's founder, science fiction writer L. Ron Hubbard. He created an outline for conduct and advancement.

For example, through counseling sessions, referred to as audits, followers are supposed to be led toward positive thinking and achieving their goals, no matter how ambitious.

Listen again to that RadarOnline video as Cruise talks to fellow devotees about world leaders.

CRUISE: They want help. And they are depending on people who know and who can be effective and do it, and that's us.

FOREMAN: That was 2004.

By 2005, Cruise was expressing even more enthusiasm over actress Katie Holmes most notably by jumping around on Oprah's sofa.

So what happened? Holmes, who was raised Catholic, is believed to have converted to Scientology as her relationship with Cruise grew. But in the wake of their split, there are reports that she is concerned over their daughter, Suri, being raised in the faith.

But for now neither is addressing those reports. Holmes' attorney called the divorce a private matter and said her primary concern is her daughter's best interests. Cruise's attorney did not respond to CNN inquiries but told "The Los Angeles Times," his client hoped the divorce would not be contentious. Cruise has spoken dismissively of what scientologists call SPs, suppressive persons, a term used for people who try to impede the mission of Scientology. Again, RadarOnline.

CRUISE: They said, so, have you met an SP? And, you know, I thought what a beautiful thing, because maybe one day it will be like that, you know what I'm saying? Maybe one day it will be that -- wow, SPs, like they'll just read about those in the history books.

FOREMAN: Whether any of this plays into the split with Holmes is yet unknown, but when Cruise and his second wife, actress Nicole Kidman, divorced, similar speculation appeared.

Kidman, who was also raised Catholic, never seemed to fully embrace Scientology. And after the breakup, she was described as enjoying a homecoming in the Catholic Church.

As for Cruise, one last time, listen to RadarOnline.

CRUISE: And I do it the way I do everything. There's nothing part of the way for me. It's just...

FOREMAN: There is no sign he has any intention of backing away from his controversial faith.

Tom Foreman, CNN, Washington.


COOPER: "Why Katie Left Tom," that's the cover story of the July 16th issue of "People" magazine. It looks -- it looks at what role Scientology may have played in the split.

Joining me now is executive editor J.D. Heyman.

So what role -- I mean, according to your sources did Scientology actually play in this?

J.D. HEYMAN, EXECUTIVE EDITOR, "PEOPLE": Well, it's interesting. I think a lot of the reports out there have really played up the role of the Church of Scientology. And that may not be the whole story.

Certainly, Katie Holmes came from a Catholic upbringing. She was not a scientologist before she married Tom Cruise. She did embrace the Church of Scientology. That was part of their life. That seems to have changed. We don't really know how important or not important it is in their dispute, but it certainly is a factor, and people are obviously curious about that.

COOPER: She's moved back to New York City. Or has moved to New York City, has an apartment now. She's trying to establish residency? Basically there's now going to be battle over where this divorce proceeding should take place?

HEYMAN: That's the way it seems to be. You know, Katie and Tom have homes all over the place. They're very wealthy people. They've -- you know, they've been all over the world. They've spent a lot of their time in Los Angeles. They do have an apartment here, and she has rented another apartment.

So the speculation, of course, is does this mean that she is, you know, making an obvious case for the fact that she's a New York resident or that she lives here? She clearly seems to want to be here, and that seems to be, you know, the thrust of some of the disagreement.

COOPER: And is she seeking full custody?

HEYMAN: It seems so. It seems that she is -- she is at this point saying that she would like to raise their daughter, Suri, and that she will be the primary parent there.

COOPER: And was he -- I mean, according to your reporting, was he aware of this? Did he know this was coming?

HEYMAN: According to everyone that we've talked to close to Tom Cruise, this was quite a surprise.

Now, there are two people in every marriage, and people close to Katie Holmes said that she is -- you know, she's been unhappy. This has been something that's been very much on her mind.

But she did not give any indication to him that he understood. As recently as a couple of weeks ago when I spoke to Tom Cruise, he was ecstatic about seeing her over his 50th birthday, very excited about that. Had plans with her, had planned to spend his birthday in Iceland with her and Suri and then some time in New York. And then, you know, they were all to fly back to Los Angeles together.

Now, obviously that didn't happen. So from his perspective, it was a shocking surprise.

COOPER: According to your reporting, though, she had been planning this for a while?

HEYMAN: She seems to have put wheels in motion for some time. She has, you know, been thinking about this. This was a deliberate course of action. She consulted people who she trusted. Her father was certainly part of her planning. But it was not necessarily apparent to him.

COOPER: She switched out cell phones.

HEYMAN: That is what we've heard, that she made some moves to kind of clean the slate.

COOPER: And is it known how much her dad is involved? Because he's a divorce attorney or family attorney?

HEYMAN: Yes, he is an attorney. He's a divorce attorney from Toledo. He's a very good attorney. They are very close family. It is clear that she has leaned on him during these, you know, past few days. But it is also clear that she has leaned on him during these past few days, but it is also clear that she's a strong person who knows her own mind. She's the one who's decided to take this action.

So I think it's very important to say if there's any misconception about Katie Holmes, it's that she's some kind of passive person who was sort of swept along in this big Hollywood marriage. She clearly knows what she wants and made some very decisive moves on her own, with help from family, of course. But she's her own person.

COOPER: J.D., thanks.

HEYMAN: Thanks so much.

COOPER: Well, a bizarre death is caught on tape. We're going to show you more of the video taken in a courtroom. The question is did the man who was just convicted of arson commit suicide in court by swallowing something? You can see for yourself. Details ahead.


COOPER: Welcome back.

In "Crime & Punishment" tonight, an investigation is underway in Arizona to determine if a man succeeded in committing suicide inside a courtroom.

Now, moments before he collapsed and died, this man, Michael Marin, was convicted of torching his multimillion-dollar home in Phoenix.

The scene inside the courtroom is captured on videotape. As you're about to see, it looks like he slipped something into his mouth. The question is did he poison himself? Toxicology tests will answer that question.

But we want to find out how a man like Marin, who at one time was successful, wealthy, how he ended up in this situation. Here's Ed Lavandera.



ED LAVANDERA, CNN CORRESPONDENT (voice-over): These were the final minutes of Michael Marin's story and life.

UNIDENTIFIED FEMALE: ... we find the defendant, Michael James Marin, guilty of arson of an occupied structure.

LAVANDERA: How he got here is a tragic and bizarre tale, but before we tell this story, remember this moment. After being found guilty of arson and now facing up to 21 years in prison, Marin covers his face and appears to swallow something. We'll come back to this scene.

Michael Marin graduated from Yale Law School, had a lucrative career working around the world for Wall Street investment banks, making several million dollars. He collected Picasso artwork, drove a Rolls Royce, and flew his own plane.

PAUL RUBIN, "PHOENIX NEW TIMES": He was an engaging character.

LAVANDERA: Paul Rubin profiled Michael Marin back in 2008 for the "Phoenix New Times" newspaper, spent hours talking to the eccentric millionaire.

RUBIN: He's the smartest guy in the room. He's the -- you know, he's the smoothest talker in the room. He gets all the girls. He's -- you know, he's that guy. And he just ran into the brick wall that happens to these characters eventually.

LAVANDERA: The brick wall was this 10,000-square-foot home in the Biltmore Estates, an exclusive Phoenix, Arizona, enclave. Marin bought the house in 2008 when the real estate market was collapsing. It came with an interest-only mortgage payment of $17,260 a month.

But Michael Marin had long left Wall Street and had not worked in several years.

(on camera) And he was quickly running out of money. That's when prosecutors say he concocted a scene to raffle off the house and, in the process, make a million dollars for himself.

(voice-over) The raffle was an oddly-created way to unload the Biltmore house. Raffle tickets would sell for $25. The proceeds would benefit the Child Crisis Center. To generate publicity for the raffle, investigators say Marin scaled Mount Everest, doing interviews from the mountain with a local television station. It all played into the Marin mystique.

MICHAEL MARIN, MILLIONAIRE: We're at high altitude. (UNINTELLIGIBLE) 25,000 feet.

LAVANDERA: Joe Epps says it was all a sinister ploy. Epps is the forensic accountant that unraveled Marin's personal finances for prosecutors.

JOE EPPS, FORENSIC ACCOUNTANT: What happened was he paid 2 million $550,000 for the house and set up with a couple of friends of his a bogus second mortgage designed to increase the value of the house by $950,000 on a second mortgage that really didn't exist.

LAVANDERA (on camera): You think this raffle was a scam to make a million dollars, basically.

EPPS: Yes. And at the same time be able to look like a very generous person who didn't make anything off of it.

LAVANDERA (voice-over): In April 2009, the Arizona attorney general ruled the raffle was illegal. The plan fizzled.

At this point, Marin was six months away from having to make a balloon payment of roughly $2 million to lenders or risk a major jump in his monthly interest payments. Marin's financial world was collapsing around him.

RUBIN: I don't think that he really thought this thing through, he and his pals, and it ended up where he had to do something that was pretty wacky, which was burn down his house.

LAVANDERA: In the early morning hours of July 5, 2009, fire engulfed Marin's Biltmore home. He called for help from his upstairs bedroom.

UNIDENTIFIED FEMALE: What's your emergency?

MARIN: My house is on fire.

UNIDENTIFIED FEMALE: Are you going to be able to get out?

MARIN: I've got one of those ladders.

UNIDENTIFIED FEMALE: You have a ladder where?

MARIN: I'd rather work on that than talk to you, so let me get out -- the hell out of here.

LAVANDERA: Marin emerged from the burning home wearing scuba gear that just happened to be ready to go in his bedroom. Jeff Peabody is the Phoenix Fire Department investigator who handled Marin's case.

JEFF PEABODY, FIRE DEPARTMENT INVESTIGATOR: Every fireman I see says, "You're not going to believe this guy. He came out of a ladder out of his master bedroom wearing a scuba tank and a scuba mask and a snorkel."

And yes, you're right. I find that odd.

LAVANDERA: Marin even relived the escape from his hospital bed.

MARIN: I realized that I actually had some air left in that tank, and that's what enabled me to get back to the window and to put down that ladder. If I hadn't had those two things, we wouldn't be talking.

LAVANDERA: Peabody says he found four spots in the house where fires were intentionally set and a long line of phone books that was supposed to help the fire spread.

Which brings us back to that Phoenix courtroom. A jury convicted Marin of arson. He's facing between seven and 21 years in prison. After he appears to swallow something after the verdict is read, notice as he reaches down and appears to get something from his bag, swallows something and appears to swallow again.

About eight minutes later Marin starts convulsing and collapses. Even though it's not been officially determined what killed Michael Marin, it's believed Marin swallowed some type of poison.

Marin's attorney says the convicted arsonist showed no signs of preparing to commit suicide.

ANDREW CLEMENCY, MARIN'S ATTORNEY: It was a gigantic shock. I think it's fair to say that we certainly had no inkling that this was going to happen. I'm not aware that anybody did.

LAVANDERA: Ironically it's Jeff Peabody, the fire investigator who built the arson case against Michael Marin, who tries to help him. But Peabody says there was no way to save him and that his final moments played out in a dramatic fashion, just as Michael Marin had lived his life.

PEABODY: If he's going to do something, this would be the time that he would do it. Sort of like escaping from his house in scuba gear. This was going to be his closure.

LAVANDERA (on camera): A grand finale exit.

PEABODY: A grand finale exit. Yes.

LAVANDERA (voice-over): Ed Lavandera, CNN, Phoenix, Arizona.


COOPER: Such a disturbing story. We'll continue to follow when those toxicology are released.

Randi Kaye is back with a "360 News Bulletin."

KAYE: Anderson, with the London Olympics three weeks away, security has been stepped up. A scare on a bus prompted police to shut down a highway. It turned out to be a false alarm. But earlier in the day, six people were taken into custody in London on terrorism charges.

The nuclear crisis at Japan's Fukushima Daiichi power plant unfolded due to willful negligence and a flawed response, according to a Japanese parliamentary panel. The panel also said the March 2011 disaster was caused by Japanese reluctance to question authority.

Here at home, mortgage rates have fallen to new lows. Freddie Mac reports that the rate for a 30-year fixed loan has dropped to 3.62 percent.

A Florida lifeguard who was fired for saving a drowning man has been offered his job back. Tomas Lopez was terminated because he saved the swimmer outside his coverage zone. He's not accepting the rehire offer.


TOMAS LOPEZ, LIFEGUARD: I radioed them in that my -- I was a lifeguard and told them, "I'm going for a rescue outside the zone. It's outside -- it's south of us." So I started going. My manager was telling me, "Don't go. Get back to your tower. Get back to your tower."

"Oh, no. I'm not going back." So I was running for a while. I still didn't see the guy. I kept running, and then I finally noticed him splashing around. I finally got to the water, and two other guests had finally got to him and started dragging him in. I then was in the water, and I grabbed him under his arms, and another guy got his feet, and we carried him out of the water.

(END VIDEO CLIP) KAYE: And mermaids don't exist? Don't tell that to these girls swimming in a mermaid show at a Georgia aquarium. But sorry, ladies. The National Oceanic and Atmospheric Association says there's just no evidence mermaids ever existed -- Anderson.

COOPER: Randi, thanks.

Up next, "The RidicuList."


COOPER: Time for "The RidicuList," and tonight we're adding whoever writes New York Mayor Michael Bloomberg's -- well, I can't say the word on television.

As you know, I love me a good pun. Gerard Depardieu, Gerard Depar- don't. You remember that whole thing. Anyway, Mayor Bloomberg was speaking earlier this week ahead of the annual Nathan's hot -- famous hot dog eating contest in Coney Island, and while he was fine with all the buns, the mayor didn't quite relish all the puns.


MAYOR MICHAEL BLOOMBERG, NEW YORK CITY: If one of their dogged pursuers will finally catch up, cut the mustard and be pronounced wiener.

Who wrote this (EXPLETIVE DELETED)?


COOPER: Who wrote this bleeping bleep, Mr. Mayor? Now, one can assume the mayor knew his microphone was hot when he dropped his "S" bomb. Is "S" bomb even a word? It is now.

Anyway, he was standing right in front of the microphone, so I'm guessing he knew everyone would hear him. Besides, he's the mayor. If he wants to grill his speechwriters over the hot-dog contest, who's going to stop him.

Regardless, the mayor is in solid bipartisan company when it comes to salty language.






COOPER: Yes. Big time. Classic moments of Americana.

Back to Mayor Bloomberg. The problem appeared to be that he didn't like what was written for him. Well, take comfort, Mr. Mayor, you are not the only one.


PRINCE CHARLES, UNTIED KINGDOM: The potential for a few flurries over Balmoral -- who the hell wrote this script? As the afternoon goes on.


COOPER: Prince Charles doing the weather.

It's not just princes and politicians who occasionally go off script. Sometimes those of us in TV news have a little slip up.




UNIDENTIFIED FEMALE: Today's snow is crippling much of the Washington lowlands.


COOPER: Why does she talk like that? "I'm so pale." Anyway, I could watch that clip all night.

Fortunately, once you get to my level of broadcast journalists, you don't have those problems anymore.


COOPER: So here at this point in this show we're usually doing much different -- much different -- much more different -- what? Oh, hey. Sorry. I didn't realize we were on the air.


COOPER: Yes, I didn't know I was on the air. Big deal. I mean, it happens.

As for Mayor Bloomberg, his hot dog speech might have been a little overcooked, but the contest out on Coney Island did not disappoint.

Twenty-eight-year-old Joey Chestnut won the title, eating 68 hot dogs in ten minutes. I don't know when this became a sport, but apparently, people now think it is. Putting in 20,000 calories, more than 48,000 milligrams of sodium. Really, who's counting?

All I know is that if Joey Chestnut can get away with eating that many hot dogs, I think Mayor Bloomberg can get away with dropping a few more "S" bombs on "The RidicuList." That's it for us. Thanks for watching. "ERIN BURNETT OUTFRONT" starts now.