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Russian Hacking Controversy; Syria Cease-fire; British PM Criticizes Kerry's Middle East Peace Speech; Major Cities Tighten Security for New Year's Eve; Remembering Stars Lost in 2016. Aired 5- 5:30a ET

Aired December 31, 2016 - 05:00   ET



NATALIE ALLEN, CNN ANCHOR (voice-over): Vladimir Putin dedicates part of his New Year's speech to Donald Trump as the tension continues between the U.S. and Russia and there's a new development in the hacking investigation.

A cease-fire in Syria is under pressure with a new report of possible violations.

Some countries are already celebrating the New Year but in Europe, security is tight amid an ongoing terror threat. We'll have a live report.

It's all ahead on CNN NEWSROOM. We are live in Atlanta. Thanks for joining us. I'm Natalie Allen.


ALLEN: Just hours after Russian president Vladimir Putin announced he would not take any immediate action over new U.S. sanctions, we are now hearing that Russian malware has been discovered on a computer belonging to a U.S. power company in Vermont.

Investigators believe it is the same type of malware recently used to hack into U.S. political institutions. We will get to that in a moment.

But first, President Vladimir Putin stunned Washington Friday when he said he will hold off on expelling U.S. diplomats from Russia. He said he will wait to see what Donald Trump does as president.

Trump applauded the Russian leader's decision in a tweet.

He wrote, "Great move on delay by Vladimir Putin. I always knew he was very smart!"

For the latest, here is CNN's chief U.S. security correspondent, Jim Sciutto.


JIM SCIUTTO, CNN CHIEF U.S. SECURITY CORRESPONDENT (voice-over): Russians vacating compounds shut down by the U.S.

Russian President Vladimir Putin, however, dismissing Washington's payback, instead wishing President Obama and his family a happy new year, saying in a statement, quote, "We will not stoop to the level of irresponsible diplomacy. It is a pity that the President Obama administration finishes its work this way, but, nevertheless, I congratulate him and his family a happy new year."

Russian Foreign Minister Sergey Lavrov recommended Putin expel 35 American diplomats from Russia after the U.S. ordered 35 alleged Russian spies to leave the U.S. by this weekend.

SERGEY LAVROV, RUSSIAN FOREIGN MINISTER (through translator): We cannot let such escapades happen without a response. The Russian Foreign Ministry, together with our colleagues from other departments, have made a proposal to declare 31 staff from the embassy of Moscow and four diplomats from the general consulate of St. Petersburg as persona non grata.

SCIUTTO: President Putin, likely waiting for a far friendlier administration under Donald Trump, did not take that advice, saying in his statement, "We will not create problems for American diplomats. We will not send anyone away."

With a stroke of drama, Putin even issued this invitation to American children.

"In response to the new U.S. sanctions, I invite all children of the U.S. diplomats to the new year and Christmas children's show at the Kremlin," signed, "Yours sincerely, Vladimir Putin."

The U.S. shut down two Russian government-owned compounds, one in New York, where law enforcement was seen outside and another in Maryland, a 45-acre property purchased by the Soviet government in 1972. Today, vehicles were seen leaving the Maryland estate and returning to the Russian Embassy in Washington. The White House says the Russians working at the compounds were spying on the U.S.

Russia, however, refutes that the estates were being used for espionage.

VITALY CHURKIN, RUSSIAN AMBASSADOR TO UNITED NATIONS: I think it's quite scandalous that they chose to go after our kids, you know?

They know full well those two facilities which they mentioned in their notes, they are vacation facilities for our kids and this is Christmastime.

SCIUTTO: Four of the Russians sanctioned by the U.S. are part of the Russian military intelligence unit known as the GRU. One of them is the unit's chief.

MICHAEL WEISS, CNN CONTRIBUTOR: It's assigning blame to Russia's military and intelligence service, but the actual perpetrators of these hacks are contractors, if you like, people who have been found by the Russian government to do their dirty work for them. Keep in mind that election hacking is not the only issue of disagreement between the U.S. and Russia. You have the annexation of Crimea, the invasion of Ukraine, bombing of civilians in Aleppo and elsewhere Syria. Those are issues that Donald Trump will have to face as president as well -- Jim Sciutto, CNN, Washington.


ALLEN: Turning back now to the Russian malware found at the U.S. power company, Burlington Electric in Vermont, it has released a statement, saying, "We took immediate action to isolate the laptop and alerted federal officials of this finding. Our team is working with federal officials to trace this malware and prevent any other attempts to infiltrate utility systems."

And Vermont senator Patrick Leahy is also responding.

His statement says, in part, "This is beyond hackers --


ALLEN: -- "having electronic joyrides. This is now about trying to access utilities to potentially manipulate the grid and shut it down in the middle of winter. That is a direct threat to Vermont and we do not take it lightly."

President Putin has issued his annual New Year's Eve address to the world. He did not mention U.S. President Barack Obama but he did congratulate President-Elect Donald Trump, who takes office in just three weeks.

He says he hopes Russia and the U.S., quote, "acting in a constructive and pragmatic manner, will be able to take real steps to restore the mechanisms of bilateral cooperation in various areas and take their interaction in the international arena to a whole new level."

Last hour, I spoke with senior economist Lilit Gevorgyan (ph) of IHS Global Insight about the future of U.S.-Russia relations.


LILIT GEVORGYAN (PH), IHS GLOBAL INSIGHT: I think if we put the new administration's stance on Russia and compare it to the former administration, it is clear that the new administration has new ideas about many things in foreign policy and domestic policy. So Russia is no exception in this sense.

I think the United States is seeing a very lively political change, which is very challenging. So I think it is not entirely surprising that, if you have a president-elect who is not really your traditional type of leader, then you will have more surprises.

But I have to say that these surprises will also concern Russia. Consistency was something that you had with previous administration, in a sense. With the new administration, Russians will be as much in the dark, so to speak, as the others. (END VIDEO CLIP)

ALLEN: At least 28 people are dead in Baghdad after suicide bombers attacked a busy commercial area. The blast also wounded at least 53 other people and leveled some businesses, as you can see. Police say the bombers were wearing vests that detonated. So far, there are no claims of responsibility.

The nationwide cease-fire in Syria has made it past the 24-hour mark. But rebel groups are warning it won't get much further if the Syrian regime continues to violate the agreement. Our Ian Lee is monitoring the cease-fire from Istanbul, Turkey, and joins us now live.

Did they say how they believed the regime is violating the agreement, Ian?

IAN LEE, CNN CORRESPONDENT: Well, Natalie, the cease-fire seems to be incredibly fragile at this moment. Over the past 24 hours, there have been accusations from both sides of violations of the cease-fire, with the rebels saying that there have been over 30 violations from the Syrian regime and their allies, with Russia and Syrians saying on the other there have been 12 violations.

We are also hearing from the Free Syrian Army, that says that plainly if these violations continue, then this cessation of hostilities is over. And thus the cease-fire is over and the fighting will resume.

They have also accused the Russians of contradicting this cease-fire agreement, saying the one that was presented to the Syrian regime didn't have the main points or the nonnegotiable points.

Part of that agreement that they were deleted so there is a lot of confusion about the agreement in itself. But right now, it does, for the most part, seem to be holding. Although, in the past, we have seen this sort of thing happen, where there are violations of the cease-fire.

They sometimes hold. They sometimes fall apart. But right now, both sides say they are sticking to it -- Natalie.

ALLEN: Well, that's good to know.

So if these violations continue, how might that affect the cease-fire?

LEE: If they do continue, it looks like the cease-fire is going to be over with. If you look back at previous ones, for instance, in Aleppo, which was negotiated between the Turks and the Russians to get to the people, the rebels out of Eastern Aleppo, that cease-fire broke down a number of times. There were violations.

But at the end, they were able to get it in hold long enough to evacuate Eastern rebel-held Aleppo. So even this cease-fire does break down, it does collapse, it is likely the Russians and the Turks will continue to push for it to be resumed.

Now also today, Russia is taking a resolution in front of the U.N. Security Council to get their support for the cease-fire and also to get humanitarian aid into parts of Syria.

ALLEN: Of course, so very much needed, of course. You are there in Turkey. And Turkey was a major player in these negotiations for the cease-fire. They brokered the cease-fire, along with Russia. What's really important --


ALLEN: -- to Turkey, to get out of this, Ian?

LEE: Well, Turkey is getting influence out of this, by and large. They do have a lot of allies in Syria among the rebel groups. They also have skin in the game. They have soldiers in there who are currently fighting against ISIS in al-Bab (ph).

The Turks want to see their interests upheld in the final negotiations for a cease-fire and a peace deal for this. They also see themselves as the protectors of the rebels, supporters of them.

So we are seeing really the two sides. On one, you have the Turks; on the other, you have the Russians, the Syrians and their allies and, most noticeably, you don't have the United States, although Russia has said the United States is welcome to these talks once Donald Trump becomes the president.

ALLEN: Right, because they're just not in it right now. Thank you so much, Ian Lee, for us, live in Istanbul.

The office of U.K. prime minister Theresa May has given a stinging assessment of a controversial statement on Israel by the American secretary of state. The move seems to have caught the United States by surprise. Sara Sidner explains.


SARA SIDNER, CNN CORRESPONDENT: More diplomatic fallout after the U.N. resolution that condemned Israel for settlement activities, saying that it is an absolute impediment to peace and against international law.

The United States abstained from that vote; the U.K. voted for that resolution. And now, though, we're hearing the U.K. criticized U.S. Secretary of State John Kerry. Prime Minister Theresa May coming out, saying she feels like he focused too intensely on the settlement issue when there are many issues here that are keeping peace from being able to happen and keeping a peace deal from coming to fruition.

And so she condemned Mr. Kerry for his comments. But then the U.S. State Department responded, saying they're very surprised to hear this from Prime Minister May because it is a longstanding British policy.

And they indeed voted for this very resolution condemning Israel on the settlement issue.

So you're seeing these rows go on with different countries and Israel certainly very angry about the U.N. vote and angry with the countries that voted for it as well as the U.S. for abstaining, because it allowed the resolution to be put down on paper and go through.

But in the end, these are, for the most part, allies; the U.S., Israel and the U.K. And Israel said, while it sees the Obama administration going out, they'll be happy to see another administration coming in. And that is the Trump administration. We saw Benjamin Netanyahu today, putting on his Facebook some compliments, if you will, to Donald Trump for the way that he talks about the Israel-U.S. relationship --Sara Sidner, CNN, Jerusalem.


ALLEN: New Year's celebrations are set to kick off in Europe amid heightened security. Coming up here, what's being done to safeguard festivities against terrorism.

Plus we look back at the many, many pop culture legends we lost in 2016.




ALLEN: Police in Rio de Janeiro are calling the death of the Greek ambassador to Brazil a crime of passion. Investigators are holding the widow of Kyriakos Amiridis (ph). She is accused of ordering a military policeman, said to be her lover, to kill her husband. Police say the man's cousin helped.

Amiridis had been missing since Monday. His charred remains were found in a burned car on Thursday outside Rio. Brazilian news reports Amiridis was appointed ambassador last January. No charges have been filed in his death. All three suspects are under temporary arrest.

Once again, Beijing and surrounding cities are dealing with choking smog. Now the highest alert level has been issued for that region. Meteorologist Pedram Javaheri is working on this.

We always hear China taking these steps and those steps to curb this. But it's just still there.

PEDRAM JAVAHERI, AMS METEOROLOGIST: Correct, yes, since 2013, that's when they initiated these different levels of the alerts. The red one's in place, even and odd license plate restrictions are in place. Factories have to shut down.

But unfortunately, the pollutant content is so high, that we are seeing the numbers rising after these restrictions are in place. That kind of tells you what we are dealing with.

The images are rather stark. We've seen things like this and I often talk about it, when you see hazy perspective like this, the particulates in the atmosphere, what it takes to create this, Natalie, is essentially the particulates are some 30 times smaller than the diameter of your hair, put billions of them together, this is what it looks like, just a hazy perspective across these central business district.

You look at the air quality index in Beijing, it is sitting right there at the top of the charts. What the World Health Organization would consider 15 times or so higher than what is considered fit to breathe. So again, a dangerous scenario setting up.

And we know what the culprit is in the energy consumption sector, China in particular, they consume 400 million tons of coal a year. The rest of the world combined, a little more than 300 million tons. Again, China exceeding that on its own; 70 percent of its energy consumption does come from coal.

You take a look. Oil comes in a large second. But when you have the weather patterns in place, you see multiple areas in high pressure. That means the air wants to sink. It is very tranquil and very stagnant in nature.

We know the highest population in the world is right across this region. We know that most active industry in the world as far as business factories and the operations are also in this region.

The elevated terrain back out towards the west essentially creates a bowl and traps the pollutants and makes it a dangerous scenario for the people living across this region.

We have seen the charts. This is 365 days in 2016. About 175 of them were considered unfit to breath. In Beijing, that is almost the case every single year. Another way to look at it is every other day is a dangerous day outside.

The cost of pollution, it is estimated by the World Bank that it is about a 6 percent hit to China's GDP. When you consider the health impact, the damage to natural resources, agriculture, tourism is also down in the last three years.

The China Tourism Academy is saying they think pollution is to blame for that as well. So it does have a wide range impact.

ALLEN: Right, because we all realize what the air does to our quality of life and our health.

JAVAHERI: Correct.

ALLEN: All right, Pedram, thank you.

The New Year has just begun in parts of the world. The Pacific Island nation of Tonga was among the first to celebrate the arrival of 2017, just a few minutes ago. But along with the celebrations, there are concerns about potential attacks and security during the festivities.

For details, journalist Chris Burns joins us from Cologne, Germany.

Germany, Chris, still reeling from that Christmas market attack there. Hello. CHRIS BURNS, JOURNALIST: Yes, absolutely, Natalie. Yes, that Christmas market attack in Berlin that killed a dozen people made German authorities think even harder about security. Thousands more police are being deployed across Germany.

In Berlin, altogether some 4,600 police are being deployed over there and here in Cologne, it is also very important because exactly a year ago, on this square here, was a lawless area. It went out of control. Police lost control. There were less than 150 police deployed in this area.

Today, there are more than 1,500. Altogether, some 2,600 with the other security, they will be watching it from the sky with helicopters and rapid deployment groups. They are going to be checking people's bags.

They're building up, right now, these police barriers, these steel barriers around me here. That's going up this afternoon. So very, very tight security. They will also be watching even from the Internet to see if anybody is mobilizing people --


BURNS: -- through social networks to collect here and cause problems. Also, authorities have banned a neo-Nazi group, NPD, from demonstrating here this evening, which would have even complicated things.

But last year, this is something the police want to avoid. There were hundreds of women attacked by mainly immigrants here. And that really was very sensitive for Germany. That was kind of a turning point for the feeling about should we be welcoming so many immigrants here.

That was a very, very sensitive thing. And authorities here want to avoid that from happening again -- Natalie.

ALLEN: Yes, absolutely, I can remember the outrage by the women and just one woman after another after another. You kept hearing the same story.

How many people are they expecting there?

BURNS: Here they expect many thousands; now in Berlin, it is usually about 1 million people. They do believe about 1 million people will be turning out between Brandenburg Gate and the Victory Column as usual.

But over there as well, lots of security. Their build up their concrete barriers that they put up after that attack that happened at the Berlin Christmas market. So additional security all over the main cities in Germany also in Hamburg, Munich, Stuttgart, hundreds of more police are being deployed to make sure, one, from an angle about that people don't get attacked physically but also to avoid any terrorist attacks.

I talked to a young couple just a few moments ago. They said, we are not so afraid of being physically attacked or mugged or robbed. What we are afraid of is terrorism. And that's where they are going to stay clear of the big crowds. We'll see what happens tonight.

ALLEN: OK. All right. We hope all goes well and people get to usher in the New Year with just fun.

Thank you, Chris Burns for us, live from Cologne, Germany.

Well, from David Bowie last January to Debbie Reynolds just two days ago in December, 2016 seems to have been a year of tremendous loss. Nick Glass recalls some pop culture legends who died and how they impacted our lives.



NICK GLASS, CNN CORRESPONDENT (voice-over): Debbie Reynolds in her first starring role, luminous and so young, much like her daughter, Carrie Fisher, in her first screen role.

Cassius Clay, as he then was, was a teen when he won Olympic gold.

George Michael, 19, when Wham took off, the same age as Debbie Reynolds when she stepped out in "Singin' in the Rain."


GLASS (voice-over): We lost so many stars in 2016, enough for a crowded tribute in the style of Sergeant Pepper. We lost Ziggy Stardust and David Bowie's many other persona; the original Willy Wonka, Gene Wilder, and the last of "The Magnificent Seven," Robert Vaughn.


GLASS (voice-over): We were left with so many indelible movie memories, Carrie Fisher as a feisty Princess Leia in "Star Wars."



GLASS (voice-over): Alan Rickman as pantomime villain, the Sheriff of Nottingham in "Prince of Thieves..."


GLASS (voice-over): -- and from the Pink Panther films, the character actor, Burt Kwouk, forever testing Inspector Clouseau's martial arts.


GLASS (voice-over): David Bowie's death in January at 69 was the first shock, a profound, almost personal loss for his many fans, who have grown up with his music in the 1980s. Bowie himself was evidently well aware of his own mortality.


GLASS (voice-over): The things only got worse for the MTV generation, Prince gone at 57 in April.


GLASS (voice-over): We remember him in his purple pumps, diminutive guitar genius, prolific singer-songwriter.

And on Christmas Day, we lost George Michael, found peacefully in bed at home at just 53.

With 2016, us middle-aged (ph) newspaper pundits, the year the music died.



MUHAMMAD ALI, BOXER: I murdered a rock, injured a stone, hospitalized a brick. I'm so mean I make medicine sick.


GLASS (voice-over): Once, Muhammad Ali was probably the most recognizable face on the planet. Dogged by Parkinson's disease for over 30 years, he'd long fallen silent. His death in June at 74 had been expected for years but still somehow marked the end of an era.

In November, the singer-songwriter Leonard Cohen faded away at home in Los Angeles. He was 82. Creative to the end, he gave a last interview to "The New Yorker" and released a final album.



GLASS (voice-over): These were just some of the stars we lost during the year. In the hours after Bowie's death, the song most played by fans was "Heroes." It helped lift collective spirits.



ALLEN: We lost some great ones, didn't we?

White House photographer Pete Souza, has spent the last eight years capturing nearly every moment of President Obama's life in the White House. Now he is sharing his favorite photos from 2016. Here they are.




ALLEN: Pete Souza there, his work at the White House.

Thank you for watching. Our top stories are right after this.