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ERIN BURNETT OUTFRONT

The Truth Behind Forced Spending Cuts; Catholic Church Shell Game?; Lance Armstrong Made $218 Million; Hotel Of Horrors

Aired February 21, 2013 - 19:00   ET

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


ERIN BURNETT, CNN ANCHOR: OUTFRONT next, we're just eight days away from forced spending cuts that have been called deep and dangerous. So why are all we hearing is blame?

Plus, as the world gets ready for a new pope, is the church using a cemetery to hide money from abuse victims?

And new information about the body found inside a hotel water tower. We have the video that that hotel does not want you to see. Let's go OUTFRONT.

Good evening, everyone. I'm Erin Burnett. OUTFRONT tonight, hurting the poor because Washington has no courage. Again today, all we heard was blame when it comes to the forced spending cuts to take effect in eight days. President Obama made some talk radio appearances.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES OF AMERICA: Whether or not we can move Republicans at this point to do the right thing is what we're still trying to gauge.

(END VIDEO CLIP)

BURNETT: Now, he's called the cuts severe and brutal. House Speaker John Boehner, guess what, completely agrees with that. He's called them deep and dangerous, but they're not doing anything about it. Here's the thing about the cuts.

They're going to hurt some people that nobody wants to hurt. People already in pain, more than 4 million homebound and disabled seniors may have to go without dinner this year because of cuts to meals on wheels programs in the forced cuts.

Seventy thousand children from lower income families will not be able to enroll in preschools and daycare centers because of the forced spending cuts. The owners of about 10,000 homes and small businesses destroyed by Hurricane Sandy won't get the money need for repair and recovery.

Now, there are all kinds of things in the forced cuts, some of which you may agree with, but some of which all of us would find offensive. We can cut the amount of money required here, many times over, frankly, from our budget without hurting poor people, though.

As Doug Holtz Eakin, a former director of the Congressional Budget Office points out, "The Sequester" is an $85 billion cut in a $3.6 trillion annual budget in a $16 trillion economy. That's a really, really tiny slice of the Thanksgiving pie, people.

There is no need to cut from the vulnerable when it should be easy to cut the amount of money we're talking about from other places. So why is all we hear, the Republicans won't do this, the Democrats won't do that?

Daniel Altman is an economics professor at NYU. Reihan Salam is a contributor for us and a writer for the "National Review." Daniel, I mean, one thing to acknowledge to people here, is finding $85 billion should be no problem.

The $85 billion is a really small chunk of the change we actually need to find. So even if you cut from the right places, if you cut the right amount, it would hurt people, and I think we have to be honest about that.

But the cuts we're talking about right now impact a lot of people, but brutal and dangerous for the economy?

DANIEL ALTMAN, ADJUNCT ASSOCIATE PROFESSOR, NYU's Stern School Of Business: Well, the thing is this. That it's $85 billion until the end of this year, but then we have these cuts maintained, and in fact enlarged in some cases, going forward over the next seven years. So we've got almost $1 trillion in cuts. So if the sequester goes forward --

BURNETT: But over that ten-year period, you have to multiply that times ten too.

ALTMAN: But expectations of future spending and economic activity and consumption. And that's why they could have an effect, and why the markets are probably a little bit worried about them, but, still --

BURNETT: But brutal, dangerous?

ALTMAN: I think they will be for some people, as you pointed out.

BURNETT: Yes.

ALTMAN: But not necessarily for the economy as a whole. And I agree wholeheartedly that we should be able to do a better job of this. The fact that politicians haven't thought at all about the economic effects of the cuts themselves, especially on vulnerable people, is embarrassing.

BURNETT: And that's, Reihan, I think that's where John Boehner and the president agree. Those cuts on vulnerable people, no one's going to say they want that, and if they do, they don't have a heart. But what I don't understand is why all they're doing is blaming each other and noun w one's coming out, again, with a plan. REIHAN SALAM, CNN CONTRIBUTOR: Well, this is why we created "The Sequester" deal in the first place. Because back then, there was no ability to agree on how do you prioritize cuts?

So when you have a situation in which when you're looking at defense cuts, I believe it's an across the board, it's like 9.5 percent across the board program plan activity, with domestic discretionary spending, it's a little over 8 percent.

Now, you might be thinking, well, some programs you should be able to zero out completely. Some programs should probably grow a little bit. If you could do that in a coherent way, the problem is they couldn't agree on that.

That's why the only thing they could agree to were these incredibly crude, across-the-board cuts, and that's the root of the problem. You can't get that basic agreement.

We got a basic agreement with a cliff deal to say, we'll delay it to March. But by delaying it to March, you now squeeze in all of those cuts into a few months, rather than over the whole 12-month budget cycle.

BURNETT: Right. Now, Daniel, let me ask you this. The American people want action on this. They're smarter than the people in Washington. Seventy percent say deficit legislation is essential and that is more than the number of people who say that immigration matters or gun control matters.

Even though if you think about the airwaves and what people in Washington talk about, you wouldn't think that. But that's what the American people think. Why doesn't Washington get it? The people want them to deal with this?

ALTMAN: Yes, I think that they understand that people want them to deal with it, but it's going to be easier for them to say is that these cuts were forced on me and it wasn't my fault and keep the blame passing from side to side than it will be to say, I actually signed is up to cuts on a program in my district, or I forced somebody else to take that. Now it's anonymous and no one has to take responsibility for any individual cut.

BURNETT: Reihan, why can't the president be that person? He has a few more years left in his term. He can't run again, right? He is in the perfect position. He's got job security and he could come out and say, I want balanced approach.

But there's going to be a lot of o pain with a lot of people to deal with this debt problem and I'm the one who is going to have the courage to tell you because these guys are running for election right now. They are not going to tell you the truth, but I will. Why won't he do it?

SALAM: The president has, in my view, very weak incentives to make a deal with his opposition right now. He believes that he actually gained so when you're looking at the question of prioritization, take, for example, the park service, they're cutting their programs, plans and activities by this crude across the board amount.

If they cut really popular, highly visible things, and he says, well, gosh, that's not my fault, that's someone else's fault, that's potentially a very shrewd move for him.

Whereas on the side of congressional Republicans, their view is that well, if we just accept whatever deal he forces us to accept then we're going to set a bad precedent in terms of who's going to make those decisions regarding prioritization and our long-term priorities. So again, it's a game of chicken.

BURNETT: Right. I get what you're saying, but when he uses the word shrewd, shrewd politics, that's what it's all about. It frustrates me. Why can't he say, I can't care about being shrewd and I don't care if you like me, I'm trying to do the right thing for the future of this country.

ALTMAN: Because, you know, he's got a power base he's consolidated over the past four years and he owes things to people in Washington. And some of them might feel like they've been hung out to dry if he were to actually have some real talk on this topic. So I think that the problem here is that a politician is never going to perfectly represent what would be perfectly beneficial for the economy. They always have political vested interests.

BURNETT: So, what, democracy is going to end up putting us in the gutter, because all we do is make promises to constituents to run for office and then hope someone down the line will have to pay for them and it won't be our country when it crashes?

SALAM: It's a very deep issue --

BURNETT: I know that's a negative, but that --

SALAM: Well, look, the fundamental thing about our political system is, you know, you need a really big level of public consensus to get things done and we just don't have a lot of public consensus.

ALTMAN: Yes, but what we're also missing is a public focused on a long time horizon, you know, longer than our politicians, and saying, we'll reward you for making sacrifices today if they benefit us in the long-term. We don't do that. We reward them for giving us stuff today.

BURNETT: That's right. Well, maybe the public saying they want this done is the public saying, look, we get it's going to be pain, you stupid people down there. We are ready. All right, thanks to both of you. We appreciate it.

OUTFRONT next, money meant for sex abuse victims being hidden by members of the Catholic Church, some of it in cemeteries.

Plus, Lance Armstrong officially the most successful cheater of all time and you've been wanting to know just how much money he made while doping. We actually found out.

And new developments in the murder case of Olympian Oscar Pistorius. His dead girlfriend's roommate, OUTFRONT.

(COMMERCIAL BREAK)

BURNETT: Our second story, OUTFRONT, Catholic Church shell game. As the church prepares to usher in a new era with a new pope, the sex abuse scandal lingers. There are allegations tonight that the church hid money that was meant for abuse victims, hid the money, and some say the most powerful catholic in the entire country is the one denying justice.

Ted Rowlands is OUTFRONT with the investigation.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Truth, it is the fundamental ingredient for human life.

TED ROWLANDS, CNN CORRESPONDENT (voice-over): During a weekday morning mass at Holy Name of Jesus in Sheboygan, Wisconsin, Father Jim Connell uses part of his sermon to discuss the Catholic clergy sex abuse scandal.

UNIDENTIFIED MALE: What actually happened? You know, who knew what? When did they know it? What did they do with the information?

ROWLANDS: Father Connell was vice chancellor of the Archdiocese of Milwaukee until mandatory retirement kicked in last year. Given his rank in the church, he is an unlikely public critic of how his archdiocese has handled the ongoing sex abuse scandal and battled victims over compensation.

REVEREND JAMES CONNELL, FORMER VICE-CHANCELLOR MILWAUKEE ARCHDIOCESE: You know, there's a sense of secrecy at that top level, and I would hope that they would -- starting with the Holy Father. Pope Benedict XVI would tell the cardinals and tell the bishops, talk, open up, let it all be known.

ROWLANDS: Connell agrees with victims here in Milwaukee who says the archdiocese has taken an especially hard line to keep abuse cases secret and to protect its money. Attorney Jeff Anderson represents hundreds of clergy abuse victims from around the country.

JEFF ANDERSON, VICTIM'S ATTORNEY: The Archdiocese in Milwaukee has been particularly deceitful, because they've been insulated for so long, they felt and believed they could get away with it.

ROWLANDS (on camera): For decades, Wisconsin's state law prevented most victims of sexual abuse from filing lawsuits, which protected the church. When that changed, critics say the archdiocese prepared for upcoming lawsuits by moving its money.

(voice-over): Church financial records show $55 million buried here, in a cemetery trust fund. The church says the money was paid by people who bought burial plots, expecting perpetual maintenance at eight archdiocese cemeteries.

Marquette University law professor, Ralph Anzivino says, if any money was moved to protect it from abuse victims, the diocese may have broken the law.

PROFESSOR RALPH ANZIVINO, MARQUETTE UNIVERSITY LAW SCHOOL: That's what's called a fraudulent conveyance under the law.

ROWLANDS: Abuse victims cried foul about the cemetery fund and other transfers, including a $74 million parish deposit fund. They point to this line from the minutes of a 2003 Archdiocese financial council meeting about abuse cases that reads, "We are working on a plan to shelter the parish deposit fund."

In December, a bankruptcy judge stated that the parish fund transfers were fishy but legal. Who could explain, New York Cardinal Timothy Dolan, now arguably the most powerful catholic in the U.S. He was archbishop of Milwaukee when the cemetery trust fund was established and when the $74 million parish deposit fund was moved.

ANDERSON: Archbishop Dolan, now Cardinal Dolan, made a conscious decision to secretly and in a quite sinister way, move funds into parishes and transfer funds into other corporations to avoid having to pay the survivors.

ROWLANDS: Ridiculous, says the cardinal. This was his response in February of 2011, when the allegations of sheltering the money first surfaced.

CARDINAL TIMOTHY DOLAN, ARCHBISHOP OF NEW YORK: To think that there was $130 million in hidden funds, like Dolan's got some offshore account in the Cayman Islands or something? This is -- this is just ludicrous.

ROWLANDS: Cardinal Dolan declined an interview with CNN and the attorney representing the cemetery trust fund says the obligation to maintain the cemeteries never ends. No one knows, for sure, how much is enough.

An ultimate win for the victims could open up not only the $55 million in the cemetery trust, but future cemetery earnings. A win for the church could provide a blueprint for other diocese going through bankruptcy and could propel Dolan's reputation in the eyes of the Vatican as the guardian of the American church.

Meanwhile, the archdiocese is spending millions in legal fees, to protect its money and reputation, which Father Connell believes needs to stop.

CONNELL: It's the love of money. Maybe that translated into greed. That is the root of all evils. And that seems to be what I see playing out in that situation. What's under the lid? What is being hidden? How embarrassing can it be?

ROWLANDS: Ted Rowlands, CNN, Milwaukee.

(END VIDEOTAPE)

BURNETT: So last month, Lance Armstrong, as we all know, admitted to Oprah Winfrey that he used performance enhancing drugs to win his seven Tour De France titles. Since then, everyone has been trying to figure out just how much money it made Lance through titles, endorsements.

Now it seems like we may have an answer. Bloomberg news says that by using public documents, interviews, court testimony and marketers comments, they have gotten a number, that Armstrong made more than $218 million. That is more money than anybody thought.

But you know what, Lance isn't the only one who benefited from his cheating, and that brings me to tonight's number, $1 billion. That's the estimated value of the Tour De France. The tour is the world's biggest annual sporting event. Every year, it brings in $200 million in revenue.

That's right. The owners of the tour earn as much in one year, due in large part to Lance, as Lance earned in his entire career. And as amazing as it might sound, since 1947, the tour has been owned and operated by one family, the Amaris.

In addition to the tour, the Amari sport organization also owns the Decar Rally and the Paris Marathon. Now, since you can't sell tickets to races that are run on public roads, most of their money comes from sponsorship and television rights.

And if you think a supercharged Lance didn't help pick up ratings and sponsors, consider this. In 2006, the first race done after Lance's retirement, ratings plunged in Germany and France and here in the United States, viewership was down, once Lance left, 52 percent. Lance made a whole lot of other people rich too.

Still to come, a woman found dead in a hotel water tower. The coroner now has a cause of death and we have the video that that hotel does not want you to see. That's next.

And a bombshell on the Oscar Pistorius case. The lead investigator on the case now facing seven murder charges himself.

(COMMERCIAL BREAK)

BURNETT: Our third story, OUTFRONT, hotel of horrors. We have new information tonight about the autopsy on that young woman who was found in the water tank in the water tower of the roof of a hotel.

The L.A. County Coroner's Office tells us that her cause of death is deferred and it could take to two months to figure it out. Kyung Lah is following this absolutely gruesome story. She's got video for you and she's OUTFRONT.

(BEGIN VIDEOTAPE)

KYUNG LAH, CNN CORRESPONDENT (voice-over): Water from the tap, something the Cecil Hotel doesn't want you to see. Hotel resident, Alvin Taylor, helped us videotape it with a cell phone.

UNIDENTIFIED MALE: Smells like chlorine.

LAH: Chlorine, what the city is using to flush the hotel's entire water system, after the gruesome discovery of a woman's body inside one of the rooftop tanks that may have been there for as long as 2-1/2 weeks. Four tanks connect to the hotel's drinking supply, and during those weeks, hundreds of residents and hotel guests have been using it.

ALVIN TAYLOR, CECIL HOTEL RESIDENT: It makes me sick to my stomach. That's why a lot of people have left and went to another hotel, just the thought of it, for so long.

LAH: The woman inside the tank, 21-year-old Alicia Lamb. The tourist from Vancouver, Canada, arrived in Los Angeles on January 26th. Surveillance video shows her acting oddly inside the hotel elevator, as if she's hiding from someone. But Katie Orphan says Lamb didn't seem odd at all when they met.

KATIE ORPHAN, THE LAST BOOKSTORE: She was very outgoing, very lively, very friendly.

LAH: Orphan is the manager of a bookstore around the corner from the hotel called "The Last Bookstore," one of the last places Lamb was seen by anyone, as she bought presents for her parents and sister.

ORPHAN: Talking about what books she was getting and whether or not what she was getting would be too heavy to carry around as she traveled or took home with her.

LAH: That was January 31st. The young woman planned to see more of California, say police. Her parents flew down to Los Angeles to plead for the city to help find their daughter. Outside the family's restaurant near Vancouver, a memorial for a young life lost too soon in an unforgettable manner.

ORPHAN: It kind of feels like the beginning of a noir novel. Like this is the beginning of a Raymond Chandler story and Phillip Marlow is going to figure out what happened. And unfortunately, this is real life.

(END VIDEOTAPE)

BERNETT: Kyung, I mean, this story is just awful. The testing of the hotel water is complete. What do the tests show?

LAH: I spoke to the L.A. Department of Public Health and they said that they look for two specific types of bacteria and the tests came back negative. Now, you may be wondering, OK, how is this possible if a body is decomposing in one of those water tanks?

Well, it's been quite cool here in Los Angeles over these last few weeks, that in combination with the natural chlorine that is put into city water, it was enough to make the water safe to drink, as icky as it may seem, science says it's still safe enough. BURNETT: Still safe enough. That's the bottom line, I guess.

LAH: Yes.

BURNETT: Wow. All right, Kyung Lah, thank you very much. It is just a truly disturbing story, and of course, a horribly tragic story for that poor girl.

Still to come, new information in the Oscar Pistorius murder trial. The roommate of the girl who was killed, her best friend is OUTFRONT.

Plus, shots fired on the Las Vegas strip today which leads to a deadly car crash.

And a winter storm bearing down on 20 states and 60 million Americans, another storm. A storm chaser tells us it's some of the worst conditions he's ever seen.

(COMMERCIAL BREAK)

BURNETT: Welcome back to the second half of OUTFRONT. We start with stories we care about, where we focus of our reporting from the front lines. And I want to begin with that massive winter storm that right now is across 20 states, coming across the United States.

A state of emergency has been declared in Missouri right now where snow sleet and ice have been completely wreaking havoc across the state. If the prediction for a foot of snow holds in Kansas City, it would be the highest daily snowfall in a hundred years.

This footage is in St. Louis. It's from storm chaser Reid Timmer (ph), who told us the roads are lake an ice skating rink. He says these are some of the worst conditions he's seen in the area since he began chasing storm 15 years ago. These images are just amazing.

All these people that are going to be stuck out there overnight. Just unbelievable.

And there was a startling scene on the Las Vegas strip today. A dispute in a valet parking lot spilled on to Las Vegas Boulevard.

Some of in a black Range Rover, all right, we'll show you the picture here, shot at a person driving a Maserati. Then the Maserati crashed into a taxi and the taxi caught fire. The sports car's driver, cab driver, and passenger were all killed. Police are still looking for the Range Rover, which fled the scene.

The nature of the dispute is not known, but we asked a spokesman for the Las Vegas Police Department where it could have been drug- related. He could only say at this point that they're not ruling out anything.

Well, Republican Senator Lindsey Graham told an audience in Easley, South Carolina, yesterday, that, quote, 4,700 have been killed in American drone strikes, but he didn't disclose his source. Now, total numbers on drone deaths to the consternation of many, are closely held by the U.S. government. So this seemed like a big headline. The AFP released a story that many media outlets then picked up, writing that, quote, "It was the first time that a politician or any government representative had referred to a total number of fatalities in drone strikes."

Well, it might have been the first time, except that when we called Senator Graham's office, it turns out he was getting his numbers from a public source, he said, the Bureau of Investigative Journalism.

Well, California's state senator, Lou Correa, has introduced a bill that's going to make it illegal for someone to drive if your blood contains, people, marijuana. A medical team says THC, the active ingredient in marijuana, could stay in your blood for days or even weeks.

If you're going to toke up, you know, you may want to be staying home for a while. This raises a lot of questions about how the law will be enforced. Because how are they going to be suspicious if it's been a week after you smoke?

Blood tests are not very effective, because THC is not effectively tested there. Urine tests can detect it for days. So would that mean that you have to pee in a cup on the side of the road? Many questions we are not yet able to get answers. Our call to Senator Correa's office regarding the enforcement has not yet been returned.

It has been 567 days since the U.S. lost its top credit rating. What are we doing to get it back?

What are we doing, Washington? There's deafening silence from you.

And now our fourth story OUTFRON: a bombshell in the Oscar Pistorius murder trial.

Lead investigator detective Hilton Botha is now off the case after revelations that he was facing seven charges of attempted murder himself. Botha and two other law enforcement officials were pursuing a murder suspect in 2001 when Botha allegedly opened fire on a mini bus filled with people. The charges had been dropped, but they were reinstated, according to reports, on February 4th.

Now, that is, obviously, 10 days before the Oscar Pistorius shooting.

OUTFRONT tonight, South Africa's national police commissioner, Riah Phiyega. I talked to her earlier and I started by asking her why Botha was ever even assigned to this case.

(BEGIN VIDEOTAPE)

RIAH PHIYEGA, SOUTH AFRICA'S NATIONAL POLICE COMMISSIONER: You mentioned that this matter was decided upon on the 4th. We received the decision yesterday.

BURNETT: So you're saying that you didn't know that they were reinstated on February 4th, but no one told you. In other words, you -- he was on the job without your knowing that, right? That's the bottom line.

PHIYEGA: The February 4th we are getting from yourselves in the media, but I am confirming to you that the feedback we received was yesterday.

BURNETT: Yesterday in court, Botha was panned for his performance, of course. And here are some of the issues. Obviously, he admitted he wasn't wearing protective boots when he was at the crime scene, he admitted to overlooking a bullet that hit the toilet bowl, and he said he found two boxes of testosterone, which later it came out that it was too early to identify the substance in that -- in those containers.

He also gave conflicting accounts about how far witnesses were that had heard screaming. Originally, he said 600 or more yards. Later revised that to 300.

And a prosecution official told BBC later when he left the court, we're in terrible trouble.

Now, at first, the police spokesperson, of course, said there were no plans to pull Botha off the investigation, despite the charges against him. Did you pull him off because of his performance in court?

PHIYEGA: Whether he performed poorly or whether he performed excellently, it is a court that will tell us tomorrow. A lot of the issues that you are raising about whether there was contamination in all those aspects, those matters are subjective (ph). We answer to those questions in court.

BURNETT: What is the bottom line, in terms of your view, commissioner, of Hilton Botha's performance? Did he do a good job?

PHIYEGA: Botha is a very good investigator. And Botha did his job. And he's got 22 years of experience, and I think he presented the case of the police well in court.

BURNETT: Now, if Pistorius has denied bail at this bail hearing, he's going to be held, of course, at the prison, which is a notorious prison, the conditions have obviously been widely criticized and it can be incredibly difficult for inmates. Allegations of rape, violence, cramped conditions. Do you worry about Pistorius' safety if he is denied bail in that prison?

PHIYEGA: There are many people that are in those jails. And I think South Africa is one of the countries that seriously respects people's rights, same as the victims that are in jail, that are rights are respected. And I do think that we are running prisons according to, you know, global human rights conditions. I am not here to, you know, to protect the prisons, but I know, as a South African, because I have viewed the service of the prisons, that our prisons are not as horrible as you put them.

BURNETT: Do you feel a pressure, though, to set an example with Pistorius? I mean, you talk about your prisons, but this is a domestic incident. South African Medical Research Council, so it's a South African source, says that 40 percent of men in South Africa have admitted to hitting their partners. One-fourth of men have raped a woman at some point in their lives.

Does that put pressure on you, as the police commissioner, as a woman, to get a verdict on this case?

PHIYEGA: I would say to you that any form of crime is our business as police. Whether that is a rape, whether it's murder, whether it's housebreaking, whether it's breaking into a business, it's crime. Our business is to ensure that citizens of this country are safe and secure.

(END VIDEOTAPE)

BURNETT: All right. Will the missteps by the prosecution affect the case against Oscar Pistorius?

Criminal defense attorney Robert Shapiro is with me. He was also a member of O.J. Simpson's defense team. Former prosecutor Wendy Murphy also joins me.

Good to talk to both of you.

Wendy, let me just start with you. You heard the police commissioner in South Africa, obviously, defensive and angry a bit there. Defending the work of her investigator, Hilton Botha. There is now a new lead investigator.

Is the case over or can it be saved?

WENDY MURPHY, FORMER PROSECUTOR: Well, I think it was a smart move to get him off the case, simply because it would have become a distraction. But -- and I thought she did a terrific job and didn't sound particularly defensive.

Look, this guy may have said some things in court that are problematic, but nothing he said, even if he made mistakes or didn't wear his booties at the crime scene, has anything to do with the real evidence that really matters, that will really be problematic for Pistorius.

So, for me, this investigator is a distraction and getting him off the case is good for the prosecution.

BURNETT: All right. But you don't think there was damage done to the case?

Robert, do you agree? ROBERT SHAPIRO, CRIMINAL DEFENSE ATTORNEY: You know, Erin, it depends on what evidence was recovered, whether there was any forensic evidence that was recovered, any evidence of contamination or any evidence of manipulation. This would be a crucial issue if this case was tried in America before a jury.

But in South Africa, as we know, jury trials were outlawed in 1930. So a judge is going to be hearing this. And judges generally are more likely to favor prosecution witnesses and police witnesses.

So I don't think it's going to have as large an impact as it would if it was in this country.

BURNETT: And that's an interesting point.

And, of course, also, as people are aware, all of this information being in the public realm so early during the bail hearing, it would also be unusual here, but they don't even have the forensics back, to your point. The defense, obviously, though, didn't seem to have a good day today, and yesterday they did, in part because of those mistakes made by Botha.

But today they didn't have a good day. The prosecution was poking holes in Pistorius' version. I want to quote something the prosecutor said because I think a lot of viewers will understand this.

He said, "You want to protect her but you don't even look at her?" He's obviously referring to when Oscar got out of bed that night. "You don't even ask, Reeva, are you all right? His version is so improbable."

And the prosecutor went to say, how could Pistorius retrieve that 9 millimeter pistol, the pistol that he used to kill her, without noticing that she was there?

Is that hard to argue with? Isn't it, Wendy?

MURPHY: Look, it sounds crazy, but this case isn't going to be won or lost on whether people are willing to believe something that sounds implausible. It is going to be about the forensics.

I think one of the craziest things he said is that he ran down to the bathroom without his prosthetic legs on --

BURNETT: Yes.

MURPHY: -- and shot through the bathroom door, and then that he then went back to the bedroom, saw that she wasn't there, which is when he thought, oh, boy, maybe I shot her. And instead of then running to the phone or being crazy, he puts his legs on.

I thought that was the dumbest thing he said. Why would you put your legs on, take the time to put your legs on after you realize, she's not in the bed, and you just shot somebody in the bathroom? That, I think, is very bad news for Pistorius. BURNETT: You know, Robert, you were O.J.'s defense attorney and there are a lot of comparisons being made between this case and that one, in terms of the circumstances, in terms of the likelihood that he -- that Oscar Pistorius will be able to be deemed not guilty.

Do you see this case as similar?

SHAPIRO: It's media fantasy to try to make these cases similar. There's only one similarity that I see.

BURNETT: Yes?

SHAPIRO: These are two famous athletes and the victims were beautiful women.

Other than that, the Simpson case was one where the jury had to decide who was responsible or if Mr. Simpson was responsible for the murder. In this case, a judge will decide whether or not Mr. Pistorius' story, to the judge, looking him in the eye, is incredible and believable.

So one is what we call a whodunit, and the other is, what is it?

So to draw these kind of parallels is nice for tabloid news, but has no basis in reality.

BURNETT: All right. Well, we'll see you both again very soon. And I appreciate your time.

SHAPIRO: OK.

BURNETT: As the bail hearing continued today, friends and family of Reeva Steenkamp gathered at her memorial in Johannesburg.

Gina Myers was one of Reeva's best friends and she joins me now on the phone from Johannesburg.

Gina, thanks very much. And I know it was a hard day for you. What happened at the memorial service today?

GINA MYERS, REEVA STEENKAMP'S BEST FRIEND (via telephone): Today, we pretty much just wanted to celebrate Reeva, as a person, and for who she is and what she was.

BURNETT: We have some new pictures of you and Reeva. I know you've known her for about six years and you've been very, very close friends for most of that time. She was staying with you for the past, about five months, I know.

What was it like living together?

MYERS: It was so much fun. She was just -- she was part of my family. So it was like having -- she was like my sister, and it was like having another sister.

BURNETT: Did she talk a lot about Oscar? Did she really not talk about him at all? I know it sounds like you had all these special times where you would talk about everything. So I'm just curious whether she really spent a lot of time talking about him or not?

MYERS: We did. We spoke about a lot of stuff, her relationships, my relationships. It was very much -- we told each other, there wasn't much we kept from each other. So we did speak about him.

BURNETT: Was it mostly positive? Did she have any worries? I mean, obviously, what she said then doesn't -- have anything to do with what happened, of course, on Valentine's Day, but it does help people understand whether she was in love?

MYERS: Yes, once again, she really was happy. There was never a moment where she questioned herself, but she was a happy person. She's a very bubbly person.

BURNETT: Still to come, the Oscars are just a few days away and we bring you a real story with a lot of heart.

And bugging your boss' office. Wow, we would all love to do that. Sending naked photos to your coworkers -- not so much. But guess what, it all happened at the FBI.

(COMMERCIAL BREAK)

BURNETT: Our fifth story OUTFRON: misconduct, even illegal activity at the FBI. And wait until you hear the details.

Bugging a boss' office, sending naked photos to coworkers -- it all sounds a lot more like a Hollywood movie plot than the inner workings of what should be one of the most respected agencies in the United States of America.

CNN has exclusively obtained internal FBI reports and investigative correspondent Drew Griffin is OUTFRONT.

(BEGIN VIDEOTAPE)

DREW GRIFFIN, CNN INVESTIGATIVE CORRESPONDENT (voice-over): The FBI's motto is fidelity, bravery, integrity. Agents take down bank robbers.

UNIDENTIFIED FEMALE: Shots are being fired.

GRIFFIN: -- and the mob.

The FBI's polished image kept in the spotlight by countless TV shows and movies.

UNIDENTIFIED MALE: I'm with the FBI.

GRIFFIN (on camera): But there's another side to the FBI contained in these confidential internal records obtained by CNN that show serious misconduct by employees and even supervisors. (voice-over): Assistant FBI director Candice Will oversees the agency's Office of Professional Responsibility. She sends out the reports four times a year to all 36,000 employees.

CANDICE WILL, FBI ASSISTANT DIRECTOR: We do our very best. We don't, obviously, if you know anything about our quarterlies, and they're not a public document, but we know that doesn't mean that CNN doesn't have a copy. There are no names, there are no locations, there are no job titles.

We do our very best to sanitize the quarterlies so that the employees' identity is protected, while imparting as much knowledge as we can about what happened, so that employees can learn something from it.

GRIFFIN: CNN obtained these summaries from the last year that include an employee who hid a recording device in a supervisor's office and did an unauthorized search of that office. Another who was involved in a domestic dispute at a mistress' apartment, in which the police were called, another hid or destroyed electronic evidence, and one other employee repeatedly committed check fraud. And then there's the employee who married a drug user/dealer and lied about them.

All of them were fired.

(on camera): Knowing what this agency does, knowing what this agency is about, how can anybody be so stupid?

WILL: Well, you know, it's funny you say that because we do -- we look at our cases and we are struck sometimes. I've been doing this a really long time. I've been doing this nine years at the FBI, and as long as I've been doing it.

And there are days I think I've seen it all. But I really haven't. I still get files and think, wow, I never would have thought of that.

GRIFFIN: But I got to tell you, I don't think I would ever bug my boss' office, especially if my boss was an FBI agent.

WILL: I know, it's extraordinary. I agree. There are some that sort of just take the cake. That was one where, you know, planting a recording device and rifling through her briefcase and lying about it, that's why this employee -- that's why that's a former employee.

GRIFFIN (voice-over): The internal reports show a 14-day suspension for the employee who paid for a sexual favor at a massage parlor, using a personal cell phone to send nude photographs to other employees got a 10-day suspension. But there was only a five-day suspension for the employee who repeatedly used a government issued BlackBerry to send sexually explicit messages to another employee at work.

These actions follow misconduct we reported two years ago, that included sleeping with informants, and viewing pornography on bureau computers. (on camera): Is that enough punishment for this kind of behavior?

WILL: Keep in mind, if you lose a week's pay, that hurts, or two weeks pay in some of those cases. And, you know, we have seen a rash of sexting cases and nude photograph cases and have people misusing their BlackBerry for their reasons, and we are hoping that getting the message out in the quarterlies is going to teach people you can't do this stuff. You know, when you are given an FBI BlackBerry, it's for official use, not to text the woman in another office who you found attractive or to send a picture of yourself in a state of undress.

GRIFFIN (voice-over): In the last three years, the FBI disciplined 1,045 employees, 85 were fired and Will says the internal warnings sent out by her office do deter bad behavior.

WILL: They do learn, because I've had employees e-mail me, stop me in the hallway, call me and say, you know, I didn't know you couldn't do that.

GRIFFIN (on camera): Erin, we did reach out to the FBI Agents Association who told us basically the same thing Candice Will told us, to keep in mind the ratio of disciplinary issues among FBI agents is the lowest in the federal government and private sector. We're really talking about a very, very small group of incredibly stupid people -- Erin.

(END VIDEOTAPE)

BURNETT: That is for sure, Drew. All right. Thank you.

And still to come, a remarkable idea that just might win an Oscar this weekend.

(COMMERCIAL BREAK)

BURNETT: The Academy Awards are a few days away. And that's going to be a lot of fun this weekend. But, tonight, we wanted to bring you an idea that's not only saving lives, it just might also take home an Oscar.

(BEGIN VIDEOTAPE)

BURNETT (voice-over): Her smile is changing the course of a nation.

KIEF DAVIDSON, DIRECTOR, "OPEN HEART": It was a very striking picture, of this girl and she was suffering from rheumatic heart disease which is a completely preventable disease, which comes from untreated strep throat, and I wanted to meet that girl from that photo. She just had such a sweet face.

BURNETT: It was Angilique's sweet face that led Oscar-nominated director Kief Davidson to learn more about a disease that was affecting more than 13 million children in Africa every year. DAVIDSON: This disease is unfair disease. People shouldn't be dying from such a preventative disease that comes from strep throat. It's ridiculous actually.

BURNETT: So ridiculous Kief decided to take action. The director flew a small film crew into the heart of Rwanda to show how difficult this disease is.

DAVIDSON: I had to take a crew that could potentially handle seeing a child die. I know if anyone really can.

BURNETT: They soon found that only one hospital would perform the risky heart surgery and it was in Sudan.

DAVIDSON: When I met the children and they were all extremely sick. There were a couple that really only had months to live. They were in very critical condition.

BURNETT: Despite their condition. Eight children began a life or death trek with Kief and his crew to Africa's only high-tech, free of charge heart surgery hospital. There, they would undergo an operation that would stop their hearts for 30 minutes, while the valves were replaced. It was their only hope for survival.

The journey touched Kief so deeply, he wanted to save not only those eight children, but as many as he could.

And just last week, what started as an idea to help one girl became a movement to help a nation.

DAVIDSON: The Rwanda minister of health has decided to make rheumatic heart disease a national priority and they are going to be building a wing in a hospital. This all came from the film. They are going to do education and outreach and they're going to work toward making sure there is penicillin throughout the country.

BURNETT: Kief, who is a father himself, gives the credit to Angelique.

DAVIDSON: Many times I said don't get too close to Angelique because she's actually probably most likely to die, and she's around the same age as my child. But, of course, when you're in the midst of all that, you can't help but -- you can't detach.

(END VIDEOTAPE)

BURNETT: Thank God that he didn't. It's amazing to think what a difference you can make, whether you are in Hollywood and certainly inspirational for all of us and for journalists as well.

You can see "Open Heart" on HBO later this year.

"ANDERSON COOPER 360" starts now. Jake Tapper is in for Anderson.