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Americans Held Hostage in Algeria; Notre Dame Football Star Duped; IOC Strips Armstrong of Olympic Medal; FAA Grounds Boeing's 787 Dreamliner; A Nation of Cheaters

Aired January 17, 2013 - 09:00   ET

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


SOLEDAD O'BRIEN, CNN ANCHOR: "CNN NEWSROOM" with Carol Costello begins right now. I'll see you tomorrow morning.

CAROL COSTELLO, CNN ANCHOR: I'm sorry, Soledad.

(LAUGHTER)

Good morning to you and hello, everyone.

Stories we're watching --

(LAUGHTER)

I was having an interesting conversation with my executive producer.

Happening now in the NEWSROOM, A ferocious football player bruised and battered by the shocking revelation that dying girlfriend that he so publicly mourned never really existed.

Cheating is everywhere. Politicians, sports stars, businessmen, celebrities, even your own kids may be doing it. Sure people get caught like Tiger Woods.

(BEGIN VIDEO CLIP)

TIGER WOODS, CHAMPION GOLFER: I was unfaithful. I had affairs. I cheated.

(END VIDEO CLIP)

COSTELLO: But will we ever learn our lesson? Today we're looking at why we cheat.

Behaving like a king. That's how Senator Rand Paul describes President Obama who signed 19 executive actions on gun control. We'll tell you what else Paul is saying.

Plus this.

(BEGIN VIDEO CLIP)

WOODS: It's going to be like that, huh? Ah, someone wants to play.

RORY MCILROY, CHAMPION GOLFER: Just trying to keep up with the old guy, you snow.

WOODS: Dude, is that your real hair?

(END VIDEO CLIP)

COSTELLO: Rory and Tiger joking on the set but the joke is on you. They weren't even together for this new Nike ad.

NEWSROOM starts now.

ANNOUNCER: This is CNN breaking news.

COSTELLO: And good morning. Thank you so much for being with us. I'm Carol Costello. We do begin with a bit of breaking news. Lance Armstrong takes another hit as the International Olympic Committee strips him of his bronze medal.

Armstrong took third place in the Men's Road Cycling individual time trial at the 2000 Olympics in Sidney, Australia. The IOC is now asking Armstrong to return that medal. The disgraced cyclist has competed in three different Olympic Games including the 1996 games in Atlanta.

The doping scandal that now surrounds Armstrong could also bring down the sport of cycling in the Olympic Games. One Olympic committee members says cycling may be pulled from the games if the scandal implicates top cycling officials inside the International Cycling Union, the sports' governing body.

We're going to have more on Armstrong's latest trouble in just a few minutes in a live report from Austin, Texas.

Now to another developing story this morning in North Africa, in Algeria, where the fate of several Americans remains unknown. They were taken hostage yesterday during an attack by Islamic militants. Happened at a gas field owned partly by BP.

Two people have been killed and there are reports this morning that some of those hostages have escaped. Defense Secretary Leon Panetta not mincing words when he talked about the incident at a NATO meeting in Rome.

(BEGIN VIDEO CLIP)

LEON PANETTA, SECRETARY OF DEFENSE: By all indication this is a terrorist act and the United States strongly condemns these kinds of terrorist acts. It is a very serious matter when Americans are taken hostage along with others.

(END VIDEO CLIP)

COSTELLO: CNN's Dan Rivers is in London.

Dan, there are so many different stories going around that the compound was attacked by the Algerian military, that some of the hostages escaped, including one American. What are you hearing?

DAN RIVERS, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, I'm afraid it is a very confusing picture. The latest line we have from the British foreign office here in London confirming that the Algerians have told them that there is an ongoing operation at this gas field suggesting that perhaps some sort of effort to go in.

We know from the Ministry of Information in Algeria that they had surrounded the terrorists with their hostages at this gas field, the troops were there. This sounds like they have gone in. There were reports, widespread reports that helicopters were being used to attack the terrorist positions.

Now the Algerian Foreign Ministry is very clear on that saying the use of helicopters is wrong, it's a fantasy, was their quote on that. In terms of the number of people that are being held hostage, we don't really have a clear idea, I'm afraid. The initial reports from the Ministry of Information in Algeria were that about 20, not more than 20 people were ambushed on their way to the airport.

They went back to the gas field plant. They were taken hostage by these terrorists who then holed up in part of the plant. They were then surrounded by Algerian forces.

There have been numerous conflicting reports that some of the hostages had escaped, some of the Algerians held in there escaped, that some have been killed. We've got no clarity at all, no official confirmation from any of the governments involved as to the exact number of people being held nor how many are still being held -- still hostage and whether any of them have definitely been killed as part of this operation.

COSTELLO: All right. We'll let you get back to it, hopefully you can bring us more information a little later in the NEWSROOM.

Dan Rivers reporting live for us this morning.

Now what may be the most shocking death of someone who never actually existed. There are new questions about Notre Dame football star Manti Te'O and the girlfriend who was nothing more than an Internet fabrication.

So who's the real victim of this hoax? Is it Te'O, one of the best college football players in the country, or the nation's sports fans who feel duped by all those tearful stories of her death?

(BEGIN VIDEO CLIP)

MANTI TE'O, NOTRE DAME LINEBACKER: I cried, I yelled, I never felt that way before. And this is six hours ago I just found out my grandma passed away and you take, you know, the love of my life. Last thing she said to me was, "I love you," and that was it.

(END VIDEO CLIP)

COSTELLO: CNN's Ted Rowlands is peeling back the layers of this bizarre and riveting story.

Ted, there are reports we'll hear from Te'O himself today. What have you heard?

TED ROWLANDS, CNN CORRESPONDENT: Well, folks here at Notre Dame said that they expect him to speak sometime over the next few days. We've talked to or reached out to his agents and nothing specific as to when or where some sort of media availability will take place or what it will be. Will it be just one interview with somebody or will it be an actual press conference, we just don't know.

Bottom line, there are a lot of questions, Carol, this morning, on this story. However, we do know one thing, and that is the University of Notre Dame is absolutely standing by their star football player.

(BEGIN VIDEOTAPE)

ROWLANDS (voice-over): University of Note Dame Athletic director Jack Swarbrick fought back tears while discussing Manti Te'O at a late news conference. He's convinced Te'O was the victim of an elaborate hoax.

JACK SWARBRICK, ATHLETIC DIRECTOR, NOTRE DAME: The thing I am most sad of, sad about is -- sorry. That the single most trusting human being I've ever met will never be able to trust in the same way again in his life.

ROWLANDS: During the football season the story of the star linebacker enduring the death of his girlfriend and grandmother on the same day transcended sports. People from around the world were touched by how in love Te'O seemed to be with Lennay Kekua, the girl he called his soul mate.

TE'O: I cried, I yelled, I never felt that way before. This is six hours ago I just found out my grandma passed away and you take, you know, the love of my life.

ROWLANDS: On the day of his girlfriend's supposed funeral, Te'O played football, after the game, Notre Dame's football coach, Brian Kelly, actually awarded the game ball to the girl we now know doesn't exist.

BRIAN KELLY, NOTRE DAME FOOTBALL COACH: I want to award this game ball to Lennay, and I'd like Manti to have this ball to take back to Hawaii.

ROWLANDS: Te'O told his coaches about the hoax on December 26th, Notre Dame kept the truth under wraps despite the fact that the media was still telling the story leading up to the national championship game.

SWARBRICK: From the outset we established a parameter that this was Manti's story to tell. We wanted to know, it would be told, we wanted to know at -- at the appropriate time when it would be told but that it was his to tell.

ROWLANDS: Many people, including one of the reporters that broke the hoax story, doesn't think Te'O's story adds up.

TIMOTHY BURKE, EDITOR, DEADSPIN.COM: Te'O's story that he's a complete -- completely innocent in this doesn't really shake through with us.

ROWLANDS: What still isn't clear is why didn't Manti Te'O ever mention that he'd never actually met Lennay when talking about how much he loved her? How did the story about how they first met at a football game start, and if it wasn't true, why didn't he correct it, and how could he have been so in love with someone he'd never actually met face to face?

SWARBRICK: You know, I think as Manti tells his story you'll see the same thing I saw, that it does -- it does fully line up.

(END VIDEOTAPE)

ROWLANDS: And Manti Te'O has released a statement. In the statement, Carol, he says that the relationship that he had with this girl was completely online, and over the phone, and he says that he is the victim of a sick joke -- Carol.

COSTELLO: Unbelievable story, Ted Rowlands, reporting live for thus morning.

No matter what you believe or who you don't, the case underscores an ugly little truth. People you meet online are often not who they claim to be.

Take a look at this documentary about "catfishing." That's what it's called when someone is duped online. In this instance the catfish victim was a man who thought he was in an online romance with a beautiful woman his age.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: How long have you been calling each other babe?

UNIDENTIFIED MALE: Two weeks maybe.

UNIDENTIFIED MALE: I'm good. Last night we had a great talk, she told me about a chicken makes an egg every day.

Meghan, I take to you my room and draw you off touching every inch of you.

(LAUGHTER)

(END VIDEO CLIP)

COSTELLO: Well, if you've seen the documentary you know what we're talking about and you knew the ending. That pretty young lady was merely the creation of a beleaguered housewife seeking an escape from her mundane life. In other words, she didn't exist. At least not how she claimed to be.

Dave Reardon is a sports columnist for "The Honolulu Star Advertiser" in Te'O's native Hawaii.

Dave, welcome.

DAVE REARDON, SPORTS COLUMNIST, HONOLULU STAR ADVERTISER: Aloha.

COSTELLO: Aloha. I'm just curious, how does Te'O's home state feel about this controversy?

REARDON: Well, a lot of people here want to give him the benefit of the doubt because this guy has a really good track record of being a good guy, great role model and this is a football crazy state here and he has -- he may be the best football player to ever come out of this state, and that kind of shades people's thinking sometimes because, like I said, football is really big here.

COSTELLO: But you know there's a lot of conspiracy theories going on around about him today in the sports world at large I might understand. This theory from ESPN's Mike Greenburg from "Mike & Mike in the Morning."

(BEGIN VIDEO CLIP)

MIKE GREENBURG, "MIKE & MIKE IN THE MORNING": What we're saying is he may have done it in order to try and get the sympathy vote for the Heisman, but you and I, as adults, to realize the risk greatly outweighs even that reward.

(END VIDEO CLIP)

COSTELLO: So are people in Hawaii thinking that way? Do they think that's even possible in light of what you've told me?

REARDON: I think that some people want to believe the best for this guy, but, you know, we're not -- we're not dummies. You know, and -- so, you know, it is -- it is pretty hard to swallow that a guy who's Punahou and -- which is the same high school Barack Obama went to, and Notre Dame educated, has always appeared to be very bright, would fall for something like this. So there is, you know, a lot of skepticism here, too, even though he's -- you know, for a lack of a better term, our guy here.

COSTELLO: Do you think that sports writers across the nation were duped by him, by his friendly, lovely persona?

REARDON: I think that's part of it, and I think that people just really fell in love with the story because it was Notre Dame, he's different, he's one of the few Polynesians who have ever attended Notre Dame, he is an outstanding player and he -- it is true that he was a good leader on that team and brought that team together and helped to go to 12-0.

Now how much of that might have been inspired by what might be a fake story or has definite elements of being fake, you can't really quantify that but it could have been a factor. You know, football is a very emotional game and players and teams get energy from emotional issues. COSTELLO: They certainly do. Dave Reardon, sports columnist for the "Honolulu Star Advertiser."

Thank you so much for joining us this morning.

REARDON: Hey, thanks for having me.

COSTELLO: Let's go back to the trouble now surrounding Lance Armstrong. Just about an hour ago the International Olympic Committee stripped the American cyclist of his 2000 bronze medal. Comes hours before we finally hear Armstrong's reported admission to using performance-enhancing drugs.

Armstrong's two-and a half hour interview with Oprah Winfrey will be shown over the next two nights.

CNN's George Howell joins from us Armstrong's hometown of Austin, Texas.

Good morning, George.

GEORGE HOWELL, CNN CORRESPONDENT: Carol, good morning. You know, the loss of this medal is a big deal. It means that the International Olympic Committee, they've looked over the information and as they see it, they decided to take action, but, you know, really, Carol, this is just the tip of the iceberg, when you think about the implications first of all this has on cycling.

The International Olympic Committee, according to one member may consider taking cycling out of the summer games once or twice. That's a big deal for cyclists who would like to be part of the Olympics, not to mention for Lance Armstrong, there will be lawsuits, depending upon what he says later today, how he says it.

You know, there will be groups, there will be sponsors that could decide to file suit against Lance Armstrong. It could mean he loses a lot of money. You know, think about this, he already may be in talks according to reports with the U.S. Postal Service about how much money he will pay back of that $30 some million that they sponsored him for.

So, you know, there's a loss of money there and he's also lost sponsored. He's lost Nike, he's lost Anheuser-Busch. These are big sponsors, big losses for him.

But, Carol, you know, here in Austin, when you talk to people, this is his hometown, mine as well. I know how important this city is to him and how big he was, has been to this city. You talk to people, there's a real mixed opinion about Lance. You know, some people see him as a hero for what he's done for cancer but many people see him as sort of a fraud or a villain. So it's really a loss of reputation as well and again, Carol, we haven't even heard exactly what he will say, how he will say it but we're seeing some agencies taking action, given what they expect to happen later today.

COSTELLO: George Howell, reporting live from Austin, Texas, this morning. This is just coming in to CNN now: the government releasing some key economic data, weekly jobless claims dropped by 37,000 last week. That's well below estimates and also a five-year low.

Also some good news in housing, housing starts for December surged 12 percent.

Staying with your money, the hits keep coming for Boeing's Dreamliner. The FAA orders 787 Dreamliners in the United States to remain on the tarmac, they grounded them. Aviation authorities around the world are following suit.

Alison Kosik is at the New York Stock Exchange with Boeing's coming financial woes because I don't think it can help it at this point.

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Well, right now, you know, what it is bad news for Boeing. At least in the short term, Carol, you look at what the stock did. You know, investors are certainly taking it on the chin. The stock taking a hit yesterday on this news that All Nippon Airways and Japan Airlines grounded its Dreamliners.

Well, guess what? Now that FAA has grounded the plane, shares of Boeing are down 2 percent in the premarket. So that's sort of piling on, that sort of taken on the chin effect.

Now, the biggest -- this is really the biggest setback for the new planes that began flying back in late 2001, but this is a plane that's really endured plenty of issues before. And aviation experts, they still believe the long-term fallout is going to be limited.

As for Boeing, it's saying that they are confident the 787 is safe and saying that "we stand behind its overall integrity. We will be taking every necessary step in the coming days to assure our customers and the traveling public of the 787's safety and to return the airplanes to service."

So, all of the Dreamliners, Carol, that were in service, all 50 of them are no longer flying. Boeing has over 800 firm orders for the Dreamliner from various airlines.

Now, British Airways is expecting to get its first Dreamliner later this year. It issued a statement saying they remain committed to taking delivery of their first Boeing 787 earlier this year. And I guess at this point, that's good news for Boeing right now.

COSTELLO: Alison Kosik, reporting live for the New York Stock Exchange.

A bit more sports to tell you about before we take out first break. LeBron James adds to his legend. Last night, LeBron became the youngest NBA player to reach 20,000 points. He did it in trademark fashion with a pull up jumper against Golden State.

Oh, yes, at 28 days and 17 years old, he beat Kobe Bryant's previous record by more than a year. LeBron also recorded his 5,000th career assist during the game. He's the 13th player in league history with at least 20,000 points and 5,000 assists. Wow!

Lance Armstrong got us thinking about other cheaters in sports, politics and everyday life. Why do we cheat? It's our talk back question today.

(COMMRECIAL BREAK)

COSTELLO: Twenty minutes past the hour. Time to check our top stories.

Sources telling CNN President Obama is expected name Denis McDonough as his next chief of staff. McDonough has been deputy national security adviser. He would be Obama's fourth chief of staff to replace Jack Lew, who was nominated for treasury secretary.

A New Jersey boardwalk damaged in superstorm Sandy will soon be returned to its former glory. The town of Seaside Heights has approved a $3.6 million deal to rebuild the mile-long boardwalk by Memorial Day. Construction said to begin within the next 10 days and completed by May 10th.

Heavy rain causes flooding in Tennessee, Georgia and other parts of the South. But, now, a cold front tonight could change the rain into snow. Oh, people are freaking out here.

Some forecasts are predicting one to four inches of snow from Mississippi to North Georgia and up to a foot of snow in the Appalachians.

Pulling money out of the ATM might get more precise. Chase and PNC Banks are dispensing the cash you need down to the dollar so there's no need to pull out 40 bucks when you only need 32. Chase says it's rolled out as many as 400 ATMs already and plans to double that by the end of the year.

Now is your chance to talk back on one of the stories of the day. The question for you this morning, why do we cheat?

Lance Armstrong has been stripped of his Olympic medal, so was it worth it? Why do so many take the easy way out?

(BEGIN VIDEOTAPE)

COSTELLO (voice-over): We've become a nation of cheaters, because cheaters win.

ALEX RODRIGUEZ, YANKEES' THIRD BASEMAN: I did take a banned substance, and you know, for that I'm very sorry, and deeply regretful.

COSTELLO: But Alex Rodriguez still gets to play for the team that boasted DiMaggio and Ruth and hold on to his $275 million contract.

BRUCE WEINSTEIN, THE ETHICS GUY: Sometimes people who realize they won't be punished if they do something wrong will go ahead and do something wrong. So there have to be consequences to the behavior for there to be a change in the behavior.

COSTELLO: Ahh, consequences. Yes, Bill Clinton was impeached but got a standing "O" at the Golden Globes.

So, it's no surprise the former butt of 1,000 Appalachian Trail jokes, Mark Sanford, is back in the news.

MARK SANFORD (R), FORMER SOUTH CAROLINA GOVERNOR: I've been unfaithful to my wife.

COSTELLO: Despite his teary confession, he's now running for Congress.

Martha Stewart went to jail for insider trading, but she and her inmate-crocheted-poncho bounced back with a TV show and a successful line of products for Macy's.

UNIDENTIFIED MALE: Go, Martha.

COSTELLO: Cheaters never prosper? Right, watch teenhollywood.com.

UNIDENTIFIED FEMALE: Did I ever consider cheating? Honestly, yes.

UNIDENTIFIED MALE: Yes, I would, I would most definitely consider cheating.

UNIDENTIFIED FEMALE: Yes.

COSTELLO: These kids inadvertently promoted a Hollywood movie about cheating on your SATs. The star, Scarlet Johansson.

SCARLETT JOHANSSON, ACTRESS: I have an idea.

UNIDENTIFIED MALE: You want to steal the answers to the test.

COSTELLO: Fantasy? No. I can't count how many news stories I've done on kids cheating. Look at the word "cheater", it's awful. But educators say many students would rather cheat than fail.

This young woman who asked us not to use her name or university was a cheater.

UNIDENTIFIED FEMALE: And a lot of students, they feel very stressed and pressured, and they kind of get cornered and they trap themselves or they mentally trap themselves and they feel like they have no other way out, so then they cheat.

COSTELLO: That brings us back to Lance Armstrong, because it makes you wonder, did he cheat because he felt stressed or pressured or cornered? Or did that come later, when the money and the prestige started rolling in?

(END VIDEOTAPE)

COSTELLO: Tough question. Talk back today: why do we cheat? Facebook.com/CarolCNN, Facebook.com/CarolCNN, or tweet me @carolCNN. Reducing gun violence will be on the agenda today when Vice President Joe Biden speaks to several mayors across the country. Coming up, a chat with Philadelphia Mayor Michael Nutter.

(COMMERCIAL BREAK)

COSTELLO: Good morning. I'm Carol Costello.

Stories we're watching right now in THE NEWSROOM at just about 30 minutes past the hour:

Wall Street preparing to open for the trading day. Right now, futures are indicating a slightly higher open. Investigators watching economic reports, including the positive housing data that just came out earlier today and work corporate earnings.

Speaking of earnings, a big miss for Citigroup as the bank reported it brought in $2.2 billion in the fourth quarter. That number is actually well below estimates.

Bank of America, though, stopped industry estimates with $36 million last quarter. The bank did get dinged, though, by the $12 billion settlement with Fannie Mae over faulty home loans.

President Obama has nominated B. Todd Jones, a former Marine, to be director of the Bureau of Alcohol, Tobacco and Firearms, ATF. And he's pressuring the Senate to confirm him. Of course, the Senate hasn't confirmed a permanent ATF director in years. Strengthening the ATF is part President Obama's new gun regulation plan.

Former governor of South Carolina wants to get back into politics. Mark Sanford formerly announced he's running for his old congressional seat. The two-term governor was mired in controversy by an extramarital affair which became public in 2009. Sanford says he deserves a second chance.

(BEGIN VIDEO CLIP)

SANFORD: U.S. senators retire every 1,000 years or something. He retires, the governor happens to pick the guy who was in the seat that I used to hold and so there's been these strange opening of doors and I don't know exactly what it means but we'll find out in nine weeks.

(END VIDEO CLIP0

COSTELLO: You can hear more from Mark Sanford tonight at 9:00 p.m. Eastern. Piers Morgan will have him on as a guest.

Today, we're learning Lance Armstrong is no longer an Olympic bronze medalist. The International Olympic Committee announced it is stripping Armstrong of his medal from the 2000 Games in Sydney. More fallout from his reported confession to doping which we will learn more about when Armstrong's interview with Oprah airs.

Remember, he's already been stripped of his Tour de France titles. So, let's take you to France now to hear people there are reacting. On the phone with us right now is CNN's Zain Verjee. She's in a town just outside of Paris.

So I'm ready, hit me. I'm sure it's not going to be good.

ZAIN VERJEE, CNN INTERNATIONAL ANCHOR (via telephone): Bon jour. It's 3:00 a.m., that's Oprah's interview. So, you know, a lot of people I talked to said they're not staying up for it, they don't care and they're actually just fed up with the whole Armstrong story.

I also asked one woman, are you going to watch? She said (SPEAKING FRENCH), "When is it?" But cycling fans I talked to said they do want to tune in. They do want to hear why he did. They're going to try and watch online.

But, you know, most people say they just want him to go away, they want the story to die down, but they don't really care about the Oprah interview -- Carol.

COSTELLO: What about the Tour de France, is it affecting that -- I'm sure it's affecting that race. What do they say about that?