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THE SITUATION ROOM

Fate of American Hostages Unclear; Lance Armstrong Comes Clean

Aired January 18, 2013 - 18:00   ET

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


MARY SNOW, CNN CORRESPONDENT: Regardless of personal opinion, it certainly has gotten people talking -- Wolf.

WOLF BLITZER, CNN ANCHOR: Certainly has. Mary Snow, thank you.

Happening now: new details of the hostage crisis unfolding in Algeria, including the fate of some Americans -- what the militants are demanding and why the Obama administration is growing increasingly frustrated.

Also, huge fallout from the Lance Armstrong interview. We will get reaction from a former teammate-turned doping whistle-blower. And we will talk about it with Judy Smith, an expert in crisis public relations who inspired the TV drama "Scandal."

I'm Wolf Blitzer here on the National Mall. Behind me, the west front of the U.S. Capitol, where President Obama will take the oath of oath there on Monday. We're counting down to the inauguration. You're in THE SITUATION ROOM.

But, first, the deadly drama unfolding right here in the -- right now, I should say, in the desert of eastern Algeria, a hostage rescue operation apparently still under way. An unknown number of captives are being held by militants who seized hundreds of people at a gas field near the Libyan border, including a number of Americans and other foreigners.

We know many of the hostages have, in fact, been released. Some managed to escape. But others are dead, others are still missing. And we have just received word that Algerian forces are now trying to negotiate the release of the remaining hostages.

CNN's foreign affairs correspondent, Jill Dougherty, is over at the State Department.

Jill, the latest information you're getting?

JILL DOUGHERTY, CNN FOREIGN AFFAIRS CORRESPONDENT: Well, Wolf, Secretary Clinton says that the U.S. remains deeply concerned about those hostages who are still in danger. She's already expressed her condolences to the families of hostages from a number of countries who have died. But exactly how many died, how many survived still isn't known.

(BEGIN VIDEOTAPE) DOUGHERTY (voice-over): The secretary of state's voice betrayed the tension as the hostage situation stretched into day three.

HILLARY RODHAM CLINTON, U.S. SECRETARY OF STATE: Let's not forget, this is an act of terror.

DOUGHERTY: The Algerians warned Clinton the situation was fluid and hostages remained in danger. Clinton relayed U.S. concerns.

CLINTON: I spoke with the Algerian prime minister again this morning to get an update on this very difficult situation and to underscore again that the utmost care must be taken to preserve innocent life.

DOUGHERTY: Algeria said 12 hostages already have been killed during the operation, hundreds have been freed or escaped. The French said one of those was theirs, but little information still on the fate of the approximately eight Americans, some of whom are still being held.

In the midst of the chaotic Algerian operation, the U.S. is trying to evacuate Americans who had been freed. A military C-130 earlier Friday took 12 wounded out. But a U.S. defense official says none were American. And other released hostages have begun telling of their ordeal.

UNIDENTIFIED MALE: Very, very relieved to be out.

UNIDENTIFIED MALE: It happened so fast.

UNIDENTIFIED MALE: My heart goes out to the guys that are still there. Hopefully, everyone comes home safe, because at the end of the day, it's only work, you know?

DOUGHERTY: But among the countries whose citizens were seized by the terrorists, frustration at the Algerian government's violent operation is spilling over.

DAVID CAMERON, BRITISH PRIME MINISTER: Mr. Speaker, we were not informed of this in advance. I was told by the Algerian prime minister while it was taking place.

DOUGHERTY: Officials from the U.S. and other countries also confirm they had no heads-up on the operation, were provided contradictory information on the raid and the status of their citizens.

CLINTON: Let's not forget, this is an act of terror.

DOUGHERTY: The White House says President Obama is receiving regular updates on the raid, that the administration is in constant contact with the government of Algeria and has "been clear that our first priority is the safety and security of the hostages."

Defense Secretary Leon Panetta says, he's putting the terrorists on notice. LEON PANETTA, U.S. DEFENSE SECRETARY: They will find no sanctuary, no refuge, not in Algeria, not in North Africa, not anywhere.

DOUGHERTY: But the demands of the group led by Mokhtar Belmokhtar seem to be growing. The hostage-takers are demanding the release of two high-profile figures, the so-called blind sheik, Omar Abdel Rahman, a life sentence in the U.S., and Aafia Siddiqui, a Pakistani neuroscientist now in prison in the U.S. convicted of trying to kill U.S. soldiers and FBI agents in Afghanistan.

The Obama administration, however, is ruling out any deal with the hostage takers.

VICTORIA NULAND, STATE DEPARTMENT SPOKESWOMAN: The United States does not negotiate with terrorists.

(END VIDEOTAPE)

DOUGHERTY: And one American who was at that site when it was attacked by the terrorists tells CNN that he escaped the very first day. His name is Mark Cobb (ph), believed to be a resident of Texas. And he sent a message to CNN saying that he escaped with some Algerian staff, but that he cannot speak to the media at this point and he won't disclose his location -- Wolf.

BLITZER: Jill Dougherty at the State Department, thank you.

We're also learning some disturbing new details about the man believed to be behind the siege, among his nicknames, the jihad prince. We will have a closer look at this militant leader. That's coming up later this hour.

Other news we're following right now, if Lance Armstrong was hoping for some redemption after his highly anticipated interview with Oprah Winfrey, he's probably disappointed today.

Kate Bolduan is here. She's got more on this part of the story that everyone is talking about.

KATE BOLDUAN, CNN ANCHOR: Everyone's talking about this story, right, Wolf. You're absolutely right.

As expected, he admitted using performance-enhancing drugs to fuel his cycling career. But his evasiveness and demeanor in the interview is not sitting well with many.

CNN's Ed Lavandera is in Armstrong's hometown of Austin, Texas.

Ed, what are you hearing there?

ED LAVANDERA, CNN CORRESPONDENT: Kate, the reactions to Lance Armstrong's appearance in the Oprah Winfrey interview last night rather critical of Lance Armstrong. But tonight's portion of the interview seems to be ready to touch on a much more complex and delicate part of his relationship with cancer survivors and the LIVESTRONG Foundation. And that will be a rather interesting part of this to watch.

Many people who have applauded Lance Armstrong for what he's done in this area, this humanitarian area for more than a decade, applaud him. But there are also many critics who say he's used this to kind of help his public image.

(BEGIN VIDEOTAPE)

LANCE ARMSTRONG, FORMER PROFESSIONAL CYCLIST: Good morning, everybody.

LAVANDERA (voice-over): Just after the U.S. Anti-Doping Agency released its reasoned decision report last October condemning Lance Armstrong as a doper, the cycling icon made his first public appearance in one of the few safe places he had left. Armstrong had just stepped down as the chairman of LIVESTRONG days before the annual Ride for the Roses charity biking event in Austin, Texas.

He was surrounded by more than 4,000 cyclists, many of them cancer survivors.

ARMSTRONG: Obviously, it's been an interesting and as I said the other night at times very difficult few weeks. People ask me a lot, how are you doing? And I tell them, well, I have been better, but I have also been worse.

LAVANDERA: As the Lance Armstrong myth has unraveled over the years, he's now often criticized for using his relationship with cancer survivors and the LIVESTRONG Foundation to salvage his public image.

It's been called the magic cancer shield. "Texas Monthly" magazine writer Michael Hall has profiled Lance Armstrong extensively.

MICHAEL HALL, "TEXAS MONTHLY": The foundation does this incredible work and then he starts to kind of use this foundation as kind of a shield, a convenient shield sometimes. And so people here are skeptical on the one hand because of the way he does that, but they are also still clearly impressed that he started this thing.

(on camera): You're still wearing the wristband?

JEAN ANNE BOOTH, CANCER SURVIVOR: I still have my wristband, yes.

LAVANDERA: You're not taking that off?

BOOTH: No.

LAVANDERA (voice-over): Cancer survivor Jean Anne Booth worries the LIVESTRONG Foundation will be hurt by Lance Armstrong's fall from grace. In 2007, she was diagnosed with breast cancer.

(on camera): Is there any part of you that thinks that Lance Armstrong used his LIVESTRONG and cancer story to mask this darker side of him as kind of a shield to protect himself? BOOTH: From my perspective, regardless of what it is that he did that wasn't what we would want in terms of doping while he was riding, on the other hand, he also accomplished something that nobody else in the world has been able to accomplish for cancer survivors.

LAVANDERA: But what many people are struggling to reconcile, despite Lance Armstrong's apologies for doping, is why a hero to so many people would act like such a bully.

Many of those watching Armstrong's televised confession have little sympathy.

UNIDENTIFIED FEMALE: He won't have the trust or the respect of the city ever again.

UNIDENTIFIED MALE: I would like to think that at some point, you know, that he would be forgiven but the reality is I think he burned those bridges a long time ago.

UNIDENTIFIED FEMALE: I want to love Lance. I still love him, I guess, at the heart, but I think it's really shady that he kept this from us for so long.

LAVANDERA: Two months ago, Lance Armstrong tweeted this picture of himself laying on his couch surrounded by seven yellow Tour de France jerseys. At the time, it was another shot of defiance and arrogance. Now it looks more like a lonely snapshot of a fallen hero, the last person clinging to a decade of lies.

(END VIDEOTAPE)

LAVANDERA: Kate, it was interesting. Leading up to this interview, Oprah Winfrey had described portions of it as being emotional. I haven't heard of many people who would describe the first night of this interview as emotional in any way. So we will see if that lives up to the expectations here tonight -- Kate.

BOLDUAN: Yes, I had that same observation watching that interview.

Any negative impact on LIVESTRONG is the real tragedy of this story. Ed Lavandera in Austin, Texas, for us tonight, thanks so much, Ed.

Among those watching the Oprah interview, Tyler Hamilton, who rode with Armstrong in three Tour de France races and wrote the explosive book called "Secret Race" about doping inside Armstrong's team. Hamilton talked to CNN's Piers Morgan. Listen.

(BEGIN VIDEO CLIP)

PIERS MORGAN, HOST, "PIERS MORGAN TONIGHT": Do you feel sorry for him? Because he trashed you.

(CROSSTALK)

TYLER HAMILTON, FORMER CYCLIST: Oh, yes. We have a whole history.

MORGAN: He just kept trashing you, saying it was all lies, you were trying to smear him.

HAMILTON: Do I feel sorry for him? Yes and no. Yes because just watching him last night on TV -- I haven't seen him since the last time he approached me in Aspen about a year-and-a-half ago. I haven't seen him since then.

MORGAN: What did he say to you then?

HAMILTON: Yes, just some unkind words, that he was going to make my life a living hell both in the courtroom and out, that a federal investigation was going on.

(CROSSTALK)

MORGAN: He was bullying you.

(CROSSTALK)

HAMILTON: I was very angry for those for -- for that encounter for a long time and scared for a while, too, because he's a powerful guy. I had to take those words seriously. But, still, I'm not a vindictive person. I don't like to see anybody suffering like that.

(CROSSTALK)

MORGAN: You haven't spoken to him since, right?

HAMILTON: No, obviously not.

MORGAN: What would you say to him now if you had the chance, if it was just you and him in a room?

HAMILTON: Last night on "Oprah" was the first step. Pat on your back for that, congratulations, good for you for doing that. It's just a small step. But the first step's the hardest. Now you have to continue.

The next step is going and testifying in front of USADA and the worldwide anti-doping association and doing the right thing, telling the truth, naming names. It's not pleasant, but he needs to do it, he needs to do it. There are other people involved in this whole fiasco.

(END VIDEO CLIP)

BLITZER: Piers is joining us now live.

Piers, Hamilton certainly doesn't seem as angry as a lot of the other folks who were betrayed by Lance Armstrong. What's your take on Hamilton specifically?

MORGAN: I can't actually hear you, Wolf. I don't know whether you can hear me.

(CROSSTALK)

BLITZER: I hear you fine. Can you hear me now? Can you hear me, Piers?

Obviously, Piers is having trouble hearing us. Let's see if we can fix that audio. We will take a quick break. Piers will stand by. We will fix the audio. Much more on Lance Armstrong, the aftermath of that explosive interview with Oprah right after this.

(COMMERCIAL BREAK)

BLITZER: We have reconnected with Piers Morgan. He's joining us from New York.

You had a pretty good interview over there, Piers, with Tyler Hamilton who was betrayed by Lance Armstrong. He doesn't seem as angry, I was saying, as some of the others who were totally betrayed by Lance Armstrong. What's your take on what's going on?

MORGAN: I was amazed by how lacking in bitterness or anger Tyler Hamilton was because of course he came out and said all this stuff about Lance Armstrong. And Lance Armstrong turned on him as he has done to everybody who's accused him of doping for the last 10 years, in a vicious, bullying and overtly threatening way.

He put the arm on him a year-and-a-half ago, met him and said, if you go ahead and testify, I'm going to get you. This is the kind of man you're dealing with. When I hear about Lance Armstrong making some kind of comeback or getting redemption, he's got a very, very long way to go, Wolf.

This is a guy who I think if you're looking at this dispassionately has been the most systematic and appalling cheat in the history of American sport.

BOLDUAN: Let's also bring in Dr. Gail Saltz into this conversation. Dr. Saltz is a psychiatrist and author of "Anatomy of a Secret Life: The Psychology of Living a Lie."

Dr. Saltz, thanks for coming in.

You are an expert on lying. In watching and listening to this interview that Lance Armstrong did, what do you make of Armstrong's demeanor? Do you think he was genuine? Do you think he actually was sorry? That's a lot of part of the conversation today.

DR. GAIL SALTZ, ASSOCIATE PROFESSOR OF PSYCHIATRY, THE NEW YORK PRESBYTERIAN HOSPITAL AT WEILL-CORNELL SCHOOL OF MEDICINE: The problem is when people are really good at lying and really pathological liars, and especially if it's purposeful, then you can't tell by looking at them whether they're being authentic or not at any moment.

And when someone has systematically done something that they now acknowledge is bullying and that they really didn't feel remorseful at that time, so they're sort of guilt-free, devoid of much of an ability to feel guilty or feel empathy, that makes it even more difficult to understand whether they could be authentic at this time or not because people who are missing their moral compass don't necessarily get that back.

So you have to wonder if there isn't other gain that they're going for, as opposed to just sort of confessing and coming clean. That being said, coming clean is the first step toward repair. And so it could be that this is an attempt to repair wrongs.

BLITZER: Yes. I can't tell you how many people, Piers, have said to me today, I can't believe a word this guy says, why should we even listen to what he's saying right now? And to that, you say?

MORGAN: Actually I'm not sure we should have to listen to any more of it. I think it was a brilliant interview by Oprah. I thought she was absolutely on top of her game, asked all the questions I would have asked.

And Lance Armstrong emerged, to me, as a kind of sniveling, soulless, unapologetic, storytelling criminal. That's what he is. This is a guy who has sued journalists. A journalist I know in Britain called David Walsh at "The Sunday Times" was sued and Armstrong won $1 million. And what were the allegations that he sued over? That he doped.

We now know that when he sued, he knew he was a doper and a cheat. You're talking about somebody who was not just denying things or lying, which, let's face it, many public figures, sportsmen have done over the years. He's a guy who systematically went after people. He bullied, cajoled them, tormented them.

We saw the interview on Anderson's last night with that poor woman that he terrorized. He's a very nasty piece of work who ran a fraudulent American sporting team for a very, very long time. He coerced younger players, younger cyclists to come in and cheat, too. They were almost rewarded with their bag of cheating goodies, the EPO and so on. What you are left with is a man who I think has defrauded America.

(CROSSTALK)

BOLDUAN: Dr. Saltz, exactly what Piers is talking about there on this idea of bullying and the fact that he says he was a bully, he was asked about this in the interview. And I want to play you just one clip and ask you about it. Listen to this.

(BEGIN VIDEO CLIP)

LANCE ARMSTRONG, FORMER PROFESSIONAL CYCLIST: I was a bully in the sense that you just -- that I tried to control the narrative. And if I didn't like what somebody said -- and for whatever reasons in my own head, whether I viewed that as somebody being disloyal or a friend turning on you or whatever, I tried to control that and said, that's a lie, they're liars.

(END VIDEO CLIP) BOLDUAN: It's not just that he went after them. He went after them viciously, as Piers is saying. What do you make of Lance Armstrong's response there?

SALTZ: It seems like a pretty transparent explanation of psychically what went on for him, which people who feel insecure and need to control things and want them to go their way sometimes employ the tactic of bullying, especially if issues like integrity aren't that important to them.

And they don't feel a lot of empathy and they have an aggressive or sadistic side. That might be the tactic they choose. Unfortunately if no one stops that -- and we know from lots of looking at bullying recently that you need bystanders to step in and say, hey, that's not OK. But people were so afraid of him, that bystanders didn't really step in and say, you can't do that.

So that allows a bully to continue on. And to Piers' point of what he's pulled over on America, one thing that's so terrible and destructive about it is, we are seeing such a surge in cheating overall in America. It's really epidemic, in high schoolers, in college students. This shows sadly the younger generation, what you can get away with in cheating, how far you can get.

And that's a terrible thing. And we really -- we need to stop talking specifically about Lance Armstrong, but we do need to talk about cheating and the importance of having a moral compass and integrity and honesty. And that should count more than fame or fortune and how are we going to help the next generation to embrace that?

MORGAN: One of the problems, if I could just jump in on that, is the punishment for cheating in American sport as it is in other countries is unbelievably small, in my view.

If you're an Olympic athlete and you're caught doping, you may get a two-year ban. You could compete at the next Olympics. Lance Armstrong apparently his whole game plan here is he wants to compete in professional triathlons and so on in the future. This guy should be banned from any professional sporting competition for the rest of his life in America.

This man has earned no right to compete again or win any tournaments or earn any prize money or represent America or anybody else for that matter. When I hear that already he's planning his comeback, I'm like, who will stop this? Where does this nonsense end? How many millions of kids in America and around the world paid money or their parents paid money to wear his LIVESTRONG armbands, which were built on complete sand?

We don't even know now if his cheating, and his steroids and his doping may have contributed to his getting cancer in the first place. I would love to know that answer. I would love to know if he set the whole charity up as a way of covering himself from the systematic cheating, because I suspect he did. And although he made hundreds of millions of dollars for charity and I applaud anyone that can do that and those charities won't be complaining about the money, let's look at how much money Lance Armstrong made from his image with that halo on his head of I'm Mr. Clean. He made Nike commercials with a halo on his head. It's all about the bike. Well, it wasn't about the bike. It was about the drugs and the cheating.

BLITZER: Piers Morgan, thanks very much, as usual. We will see you at 9:00 p.m. Eastern later tonight, "PIERS MORGAN TONIGHT." Dr. Gail Saltz, thanks to you as well.

We're going to have a lot more on this story later this hour. We will talk with Judy Smith. She's an expert in crisis public relations. She actually inspired the TV drama "Scandal."

BOLDUAN: Yes. And also up next, they have been compared to a virtual strip-search. Now the TSA makes a major announcement about this airport body scanner.

(COMMERCIAL BREAK)

(NEWS BREAK)

BOLDUAN: Turning now to a raid that unfolds in large and small cities across the country, a crime that robs women of their freedom and dignity.

BLITZER: Cracking down on human trafficking is a massive undertaking.

CNN's Martin Savidge got an exclusive inside look at one successful operation.

(BEGIN VIDEOTAPE)

MARTIN SAVIDGE, CNN CORRESPONDENT: Wolf and Kate, CNN was granted exclusive opportunity to ride along with federal agents as they carried out one of the biggest human trafficking raids here in the South in years.

(voice-over): It's 5:15 a.m., and Operation Dark Night is living up to its name. In South Savannah and a half dozen other communities in four states, more than 100 federal officers head out to hit 16 different sites at exactly the same time.

That's critical because authorities believe all of the locations are linked. Agents hoped to take down an entire alleged sex slave network in a single blow, 25 minutes from now.

BROCK NICHOLSON, ATLANTA ICE SPECIAL AGENT IN CHARGE: When it comes down to going in, they will be focused especially a case like this where they are hoping to rescue someone.

SAVIDGE: Because the case involves suspected human trafficking of women, mainly from Mexico and Nicaragua, it was fast tracked over six month, an alphabet soup of agencies take part, Homeland security, ICE, FBI, IRS, DEA, local authorities, even the U.S. Coast Guard.

UNIDENTIFIED FEMALE: The transportation took place, right?

SAVIDGE: The entire operation coordinated from the eighth floor of a downtown Savannah office building.

RYAN SPRADLIN, ATLANTA ICE SPECIAL AGENT IN CHARGE: There's some anticipation. The adrenaline flows and you're just -- you're really hoping that you have everybody that you have out there is safe.

SAVIDGE: The teams strike at exactly at 6:00 a.m.

(on camera): So, the entry teams have already gone in. We're simply waiting for the all-clear so we can go and have a closer look. Minutes later, I watch as authorities lead out the man they say is the prostitution ring's leader and one of the girls he is said to have enslaved.

(voice-over): He goes one way and she another. According to the federal indictment, some of the women were forced to have sex with clients 25 to 30 times a day.

In the apartment, agents find a 10 x 12-foot box constructed of wood and insulation. They believe it's where the woman here was forced to work and live. Even to veteran investigators, it's a new low.

BROCK NICHOLSON, ATLANTA ICE SPECIAL AGENT IN CHARGE: It drives me insane that these women, their -- their everyday life would be a hellish nightmare for any individual. So yes, it -- I get a little mad sometimes.

SAVIDGE: Twelve miles away, another federal team with an arrest warrant pulls into a subdivision full of school buses and children. They're after the other part of the sex slave equation, the alleged customers.

ED TARVER, U.S. ATTORNEY, SOUTHERN DISTRICT OF GEORGIA: They are the demand. They are the reason the services is being provided. If there were no johns, there wouldn't be this problem.

SAVIDGE (on camera): The suspects in this case will eventually end up in a county jail. But the victims, they'll end up here at a hotel.

(voice-over): It's where I find Alia el-Sawi waiting for them. She's a special victims assistance specialist.

ALIA EL-SAWI, FBI VICTIMS SPECIALIST: I've been working specifically with survivors of human trafficking for about eight years now.

SAVIDGE: Hers is perhaps the hardest job, easing these women back into a life of freedom.

EL-SAWI: Naturally, there's some hesitation, because we are complete strangers. There's hesitation, because we have affiliated with law enforcement. But our job is to try to build that rapport, try to put them at ease and hopefully, be able to assist them and assist the case that we have going on.

SAVIDGE: The operation's over before lunch. At least 50 people are taken into custody and 11 women freed. Authorities call it a good day.

JOHN NORITON, ICE: This isn't the end to human trafficking. This is a worldwide phenomenon. And sadly, it goes on as we speak. Got to attack it relentlessly, every, every day.

SAVIDGE (on camera): As for the women who were rescued, authorities acknowledge that they came into the country illegally, but they also know that wasn't their fault. Federal investigators say they will be allowed to remain here as long as they want, at least for the foreseeable future -- Wolf, Kate.

(END VIDEOTAPE)

BOLDUAN: Martin Savidge, thank you so much.

He's known as the Jihad Prince. We're going to look at the alleged mastermind of the Algeria hostage siege.

Also, can Lance Armstrong put his life back together? That's a good question. We'll ask someone who specializes in damage control for celebrities and politicians. She's the real-life inspiration for the TV drama "Scandal."

(COMMERCIAL BREAK)

BLITZER: Let's get some more now on the hostage crisis unfolding in Algeria, the militant leader believed to be behind it. The state- run Algerian news service reports hundreds of hostages seized at the remote gas field have been freed in an ongoing Algerian military operation. But a dozen have reportedly been killed and dozens more remain unaccounted for.

CNN's Brian Todd is joining us now with more on the alleged mastermind of it all.

Brian, what are you finding out?

BRIAN TODD, CNN CORRESPONDENT: Wolf, his name is Mokhtar Belmokhtar, not well known in the west until now. Very well known in northern Africa as a militant leader. He's one of the most wanted men in that region, long a target of French and Algerian counterterror forces.

(BEGIN VIDEOTAPE)

TODD (voice-over): He's got a lot of nicknames, each one bolstering the image of a seasoned militant. The Jihad Prince, The Uncatchable, Mokhtar Belmokhtar, the mastermind behind the terror attack and hostage siege in Algeria, is one of the most famous militant leaders in North Africa.

PAUL CRUICKSHANK, CNN TERRORISM ANALYST: Mokhtar Belmokhtar over the last half decade has emerged as a significant player within the al Qaeda fold.

TODD: Canadian diplomat Robert Fowler was held hostage by Belmokhtar's cells for months in Niger and gives his own menacing description.

ROBERT FOWLER, CANADIAN DIPLOMAT: He's got a great scar through his eyebrow, across his eye, down his cheek. It gets lost in his beard.

TODD: Those kinds of battlefield wounds gave him another nickname, The One-Eyed.

Mokhtar Belmokhtar, 40 years old, grew up in the deserts of southern Algeria. He fought with Mujahedeen rebels in Afghanistan in the early '90s, then with militants battling Algeria's government in a devastating civil war. That group became al Qaeda in the Islamic Maghreb. It was with them that Mokhtar earned yet another nickname, Mr. Marlboro.

AARON ZELIN, WASHINGTON INSTITUTE FOR NEAR EAST POLICY: He's called Mr. Marlboro just because of his past with cigarette smuggling, as well as weapons and other paraphernalia. But later on over the past six to seven years, he's also been involved in a lot of hostage takings on behalf of al Qaeda in the Islamic Maghreb.

TODD: A practice which allegedly made Belmokhtar millions and made enemies within al Qaeda.

Because his gangster ways and independence either didn't live up to the jihadist ideal or simply made his cohorts jealous, Belmokhtar split with the leadership of al Qaeda in the Islamic Maghreb last year. He formed an elite commando unit called Those Who Sign With Blood. That's the group that launched this operation in Algeria.

During this chaotic rescue attempt, would Mokhtar Belmokhtar have tried to kill whatever hostages were left?

CRUICKSHANK: Mokhtar Belmokhtar is somebody who has a track record of trying to get something out of every terrorist attack that he carries out. And so just executing hostages has never really been his M.O.

(END VIDEOTAPE)

TODD: And there's a chance that Belmokhtar may be wheeling and dealing again. A Mauritanian news agency reports that, in exchange for American hostages, the militants at that Algerian gas facility are demanding the release of a well-known Pakistani militant in U.S. custody, Aafia Siddiqui and of Omar Abdel-Rahman, the so-called Blind Sheik, serving a life sentence for plotting the 1993 World Trade Center attack. Wolf, there's no way they're going to get those people in exchange for those hostages. So we'll see what happens. BLITZER: Is there any indication, Brian, that Belmokhtar has been on the ground at that gas facility in Algeria, physically -- physically leading the operation?

TODD: We don't know for sure at this point, Wolf. But the analysts we spoke to say he's likely not there. They say he's most likely somewhere in Northern Mali commanding this operation from afar. Analysts say he sent an experienced commando unit to launch this attack. Paul Cruickshank called this the A-team of his group.

BLITZER: Brian Todd, thanks very much for that report.

BOLDUAN: Still ahead, she's an expert in scandal. Quite a title. In fact, she inspired the TV drama of the very same name. We'll talk to crisis communications expert Judy Smith, about the controversies swirling around Lance Armstrong and Manti Te'o.

(COMMERCIAL BREAK)

BLITZER: Lance Armstrong's doping confession is the latest in a very, very long line of scandals. And there's a primetime series of the same name about managing these kinds of public relations crises.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: I have enough to arrest her right here, right now.

UNIDENTIFIED FEMALE: You could. But being an upholder of the Constitution, you'd need an arrest warrant, wouldn't you? Do you have one of those? My white hat is bigger than your white hat.

(END VIDEO CLIP)

BOLDUAN: Judy Smith was the person, was the inspiration for that very show, a very popular show, at that. She's CEO and president of Smith & Company, a crisis communications firm.

BLITZER: Judy, thanks very much for coming in. Here's the question...

JUDY SMITH, CRISIS COMMUNICATIONS EXPERT: Yes.

BLITZER: ... if Lance Armstrong were your client, how would you grade the interview with Oprah?

SMITH: That's a tough one, Wolf. I think I would probably give him a "C" or a "D."

And the reason why I say that, Wolf, is admitting that he doped is a good first step. The issue is that the interview, quite frankly, it you know, generated more skepticism than sympathy.

I think if he was looking to reconstruct his image based on the interview, I think he clearly failed. I think redemption, though, is another story. I think the public will start to turn their attention to not what he says but what he does moving forward. And I think that's going to be critical.

BLITZER: I want to remind our viewers, Judy, how brutal he was in lying over the years. I'm going to play a little clip where he went after his critics.

SMITH: OK.

(BEGIN VIDEO CLIP)

LANCE ARMSTRONG, DISGRACED CYCLIST: To the skeptics, I'm sorry for you. I'm sorry you can't dream big, and I'm sorry you don't believe in miracles.

That's longer than seven years. I have never doped.

UNIDENTIFIED MALE: It's not just simply you don't recall?

ARMSTRONG: How many times do I have to say it?

UNIDENTIFIED MALE: I'm just trying to make sure your testimony is clear.

ARMSTRONG: It can't be any clearer than I've never taken drugs.

(END VIDEO CLIP)

BLITZER: So what did he do -- if he were your client, what did he need to do last night that he didn't do? What would you have advised him?

SMITH: I think what he didn't do was really show a level of remorse. You know, most people that saw the interview didn't feel that the apology was authentic. They didn't feel like he meant the apology. And so that's caused a lot of concern.

And also, too, I think the fact that he was so, as you said, just adamant about, "No, I didn't do it, I didn't do it," and so aggressive and persistent about that issue for so long, that you cannot erase that 12 years of lying in one interview. That's not possible. It's not going to happen.

BOLDUAN: Judy, I want to ask you about another sports controversy, Manti Te'o. He's clearly not facing anywhere near the kind of allegations or even the trouble that Lance Armstrong is facing. But still he is embroiled in the middle of a very wild story and wild controversy.

What should he do at this point? We haven't really heard from him yet. Should he come out and do one big interview? What would your best advice be in this situation?

SMITH: Yes, I think the best advice, without knowing all the facts, because all of those issues are still unfolding, I would start with telling the truth, because information that's coming out now clearly indicates that all that's been said has not been factually accurate. So, yes, I mean, starting with telling the truth and certainly doing it once, answering all the questions completely would be a good place to start.

BLITZER: And you've always suggested -- and I think other crisis managers have always suggested you get out in front of the story. Don't wait for others to break the bad news. You break the bad news on your terms. Obviously, Lance Armstrong should have done that a long time ago. That's a basic bottom -- bottom-line rule, isn't it?

SMITH: It is. It absolutely is, Wolf. I mean, now both of the athletes that are involved in these scandals have to beat back stories and facts and allegations and all of those that have been framed by other people.

The reason why we suggest getting out in front, quite frankly, is that you don't want to let other people frame the narrative for you. You want to be in charge of that yourself and frame that, based on your own messages and on the facts that you know to be true.

So neither one of those have been successful. Neither one of those athletes have been successful at doing that. That's all.

BOLDUAN: Back to Lance Armstrong for just one moment, Judy. Do you think he can rehab his reputation? That is a very big question. Clearly, no matter what other intentions he has in doing this interview, that seems to be one of the things he's trying to do, get back on the right side, in people's good graces. Do you think it's possible?

SMITH: I do. I just think it's going to take time. And it depends on what he wants to do. You know, there's been some conversation out there that he wants to get back into sports. I see that as a very long shot.

I think that what he needs to focus on is himself and really start to focus on perhaps what he can do for the sport and how he can help clean up the sport. And what value he can add to, quite frankly, all of the kids and millions of people that have looked up to him over the years. So it's going to take time. It's not an overnight fix, not at all.

BLITZER: Judy Smith, as usual, thanks very much for coming in. Always has such good advice.

BOLDUAN: Very good advice. People should listen to her.

BLITZER: I hope your clients listen to you, Judy.

SMITH: Thank you so much for having me. Appreciate it.

BOLDUAN: Thanks, Judy.

BLITZER: Thank you.

Up next, the behind-the-scenes information on the inauguration. We're going to show you the invitation that the VIPs are getting.

And Joe Biden, the vice president of the United States, he's certainly provided some comics with material over the years. Now "The Onion" is about to take it to a whole new level. We're getting ready to hear from the editor.

(COMMERCIAL BREAK)

ANNOUNCER: This is CNN breaking news.

BLITZER: Now, we have breaking news coming into THE SITUATION ROOM. CNN has now confirmed one American has, in fact, been killed in Algeria. Let's bring in our foreign affairs correspondent, Jill Dougherty. She's over at the State Department.

What do we know? What are we learning, Jill?

JILL DOUGHERTY, CNN CORRESPONDENT: You know, Wolf, that's about the fact that we do know that one American has died and that the family has been notified. And that, that really is it.

We don't know precisely when that person died. We don't know the circumstances. And this continues to be a very unclear situation, how many total died, how many people are out, et cetera.

But we can confirm, according to a U.S. official, that -- a senior official, that one American is, unfortunately, dead.

We also believe that this operation in some fashion or other is continuing. And as we've been reporting all along, a lot of information, very, very unclear -- Wolf.

BLITZER: We also -- I understand we've learned that the family of that deceased American, the American killed in Algeria, has now been notified.

We're getting more information. We'll bring it to our viewers as soon as we get it.

Jill, thanks very, very much.

Much more news right after this.

(COMMERCIAL BREAK)

BLITZER: He's been a favorite subject for years. Now the satirical newspaper "The Onion" is out with an e-book about him. It's called "The Vice" -- excuse me, it's called "The President of Vice," the autobiography of Joe Biden. "The Onion" editor Will Tracy is here to talk about it.

Will, thanks for coming in. So why Joe Biden?

WILL TRACY, EDITOR, "THE ONION": Well, I think that there's something about Joe Biden and our coverage of him that people recognize. He's one who's very comfortable in his own skin. He's a major American figure, and that's why we felt this book was important. That's why we asked the vice president to write this book for us. And he made the book, sort of a summary of his major life accomplishments and his career accomplishments, including the first beer he ever drank, his sexual education at the hands of his high-school principal, the time he took drugs in a New Mexico December cert and met God. And so we wanted the book to be a well-rounded portrait of who he is, and I think that's the book he turned in to us.

BOLDUAN: I want to remind some of -- some of our viewers, some of the fun that you've poked at Joe Biden over the years. Clearly a lot of material to work with.

Here's one of the headlines. It says, "Biden Says Life Better Than it Was Four Years Ago but Nothing Can Change Summer of '87."

Also, another headline says, "Joe Biden Hitchhikes to Democratic National Convention." "Biden Asks White House Visitor if He Wants to Check out Roof."

And this one -- I remember this one very well: "Shirtless Biden Washes Trans Am in White House Driveway." As well as, "Joe Biden Shows up to Inauguration with Ponytail." That would be some darn sure breaking news.

So Will, do you think you've actually been a little hard on him or is it just kind of low-hanging fruit?

TRACY: No, I think this is -- the book is an accurate reflection of who he is as a person. Again, he wrote the book for us. He was primarily concerned with his advance, but he did turn in the book. He reportedly wrote it in about eight or nine hours under the influence of some recreational substances.

But I think we're very happy with the book. He's happy with the book. And I hope the American people all read it and appreciate really what a stellar individual he is.

BLITZER: Here's a question. Is "The Onion" ready to endorse Joe Biden for 2016?

TRACY: Well, I think it's an inevitability that he will be the president one day. And so, yes, we will endorse him. We will -- I think he would probably be one of our finest presidents. He is sort of the "every man" in a way. I think most Americans can look at him and relate to him.

BLITZER: You know, occasionally, and this is fascinating, some of your stories are sent out all over the world, and some people out there take them seriously. I'll give you a couple of examples, and Will, you're familiar with these.

An Iranian news agency took this story as a real one. "Gallup Poll: Rural Whites Prefer Ahmadinejad to Obama." You remember that one. And then, a Chinese newspaper believed this was a real award for Kim Jong-Un, leader of North Korea, "Kim Jong-Un Named The Onion's Sexiest Man Alive for 2012."

How much of a problem is this for "The Onion," that there's some folks out there who actually take your stuff very, very seriously and literally?

TRACY: Well, they should. Because what we're printing, of course, is the truth. We are the No. 1 paper of record in America. We're the most powerful media organization probably in the world at this point. So I don't really see why any human being would want to get information from any source other than "The Onion." So that's exactly what we want to happen.

BLITZER: The new book, it's an e-book. It's called "The President of Vice: The Autobiography of Joe Biden." And Will Tracy, I hope you come visit us here in THE SITUATION ROOM from time to time.

TRACY: Absolutely, love to be back, thank you.

BLITZER: Thank you very much.

BOLDUAN: He can keep a straight face. That was very good. I clearly am not as good at that. We have -- we have right here in our very hands, and I hope you see it.

BLITZER: Yes. We've got more, too.

BOLDUAN: I know, but I got the good copy.

BLITZER: This is -- no, we've got this one. This is the program.

BOLDUAN: I know. This is the official invitation. Hold it up, Vanna. Well done. Sent to VIP members of Congress and the official program, which was a history, also has a history of the United States Capitol inside, plus the program of events, of course, the public inauguration day, which is Monday. You can see it right here. It's really, really quite beautiful.

BLITZER: It's gold. Gold glitters here.

BOLDUAN: It's gold.

BLITZER: "The honor of your presence is requested at the ceremonies attending the inauguration of the president and vice president of the United States."

BOLDUAN: Yes. The guy we were just talking about. He'll be here. You'll be here. I'll be here.

BLITZER: We'll be here tomorrow. We'll be here Sunday. We'll be here Monday. Lots of live coverage coming up. This is history unfolding, and we're thrilled.

BOLDUAN: Absolutely thrilled.

BLITZER: Thrilled to be here. Thanks very much for joining us. We'll see you back here tomorrow. Tweet us, as well.

"ERIN BURNETT OUTFRONT" starts right now.