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Interview With Texas Congressman Will Hurd; Flynn Paid By Russians?; White House Stands By Trump Wiretapping Allegations; Indictment in Navy's "Fat Leonard" Sex & Bribery Scandal. Aired 6-7p ET

Aired March 16, 2017 - 18:00   ET



WOLF BLITZER, CNN ANCHOR: And the House speaker, Paul Ryan, all now say they have seen no evidence. How long will the White House stand by the president's explosive, but unsubstantiated allegation?

Russian payment. A top House Democrat says fired National Security Adviser Michael Flynn was paid for more than $30,000 by Russian TV for a speech. Why did Flynn deny it?

Lack of consensus. The future of the GOP health care bill is increasingly in doubt, with one Republican congressman now saying there are enough no votes to sink it. With no clear path to passage, what will happen next?

And going to court. The White House vows to appeal rulings putting President Trump's new travel ban on hold, despite changes designed to withstand legal challenges. Is the president's latest order actually an unconstitutional Muslim ban?

We want to welcome our viewers in the United States and around the world. I am Wolf Blitzer. You're in THE SITUATION ROOM.

ANNOUNCER: This is CNN breaking news.

BLITZER: We are following breaking news, a very contentious, truly extraordinary White House news briefing, with Press Secretary Sean Spicer standing by President Trump's wiretap claim and accusing reporters of cherry-picking their coverage of it.

Spicer berated the news media when asked about statements by congressional Intelligence Committee leaders and the House speaker, all, all of them now saying they have seen no evidence backing up the president's allegation that President Obama ordered surveillance on him at Trump Tower in New York City.

There is more breaking news. CNN has learned that documents obtained by the House Oversight Committee show that fired Trump National Security Adviser General Michael Flynn was paid more than $30,000 by the Russian TV network R.T. The money was payment for a speech Flynn gave in Moscow two years ago.

Flynn has denied taking any money from Russia. But U.S. intelligence considers R.T. a Kremlin propaganda tool.

We are covering all of that, much more this hour with our guests, including Congressman Will Hurd. He's a member of the Intelligence Committee. Our correspondents of expert analysts are also standing by.

Let's begin over at the White House, the White House angrily standing by President Trump's claim that President Obama had wiretapped him.

Even as Mr. Trump and his aides appeared to walk back on part of the allegation, the president told Fox News there is evidence that's still forthcoming.


DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I have been reading about things. I read in I think it was January 20 a "New York Times" article where they were talking about wiretapping.

There was an article. I think they used that exact term. I read other things. I watched your friend Bret Baier the day previous where he was talking about certain very complex sets of things happening and wiretapping.

I said, wait a minute, there is a lot of wiretapping being talked about. I have been seeing a lot of things. Now, for the most part, I am not going to discuss it, because we have it before the committee, and we will be submitting things before the committee very soon. That has not been submitted as of yet. But it is a potentially a very serious situation.


BLITZER: But the president is increasingly isolated in his claim.

House Speaker Paul Ryan told me just a short time ago he has seen no evidence. The heads of the Intelligence Committee in the House, the Senate, they say basically the same thing.

And now the head of the Senate Intelligence Committee is saying -- quote -- "Based on the information available to us, we see no indications that Trump Tower was the subject of surveillance by any element of the United States government either before or after Election Day, 2016."

Let's get more on the breaking news with our senior White House correspondent, Jim Acosta.

Jim, the White House and the president, they're pretty much standing alone on this.


We stared into the abyss over here at the White House today in the search for truth, and didn't find much, as we tried to press White House Press Secretary Sean Spicer on the statement that you just read from the Senate Intelligence Committee essentially saying they have not seen any information up to this point that would lend any credence to the president's claim that he was wiretapped by former President Obama.

We tried to press a visibly angry Sean Spicer, the White House press secretary, on this point at the press briefing today. It is a very lengthy exchange. Here is how it all went down.


QUESTION: Day before yesterday, you said you were extremely confident that the House and Senate Intelligence Committees would ultimately vindicate the president's allegation that Trump Tower was wiretapped.

As I'm sure you have now seen, the Senate Intelligence Committee has said they see no indications Trump Tower was the subject of surveillance. That seems to be a pretty blanket statement. What's your reaction?

SEAN SPICER, WHITE HOUSE PRESS SECRETARY: Well, I think there are several things.


I would also -- it's -- its interesting to me that you know, just as a -- as a point of interest that when -- when one entity says one thing that -- that proves, that claims one thing, you guys cover it ad nauseam.

When Devin Nunes came out and said I think it's very possible, yesterday, there was crickets from you guys. When Devin Nunes came out and said there was no connection that he saw to Russia, crickets. When Tom Cotton said the same, you don't wanna cover this stuff -- no, no, hold on...


SPICER: No, no, actually, here's his quote, Jonathan. No, here's the direct quote: "I think it's very possible" -- end quote. That's what he said when he said the president's communications could've been swept up in collection.

So again, I...

QUESTION: He said there was no -- I saw no indication of a wire tap...


SPICER: I understand that and I think -- and I think the president's been very clear when talks about this, and he talked about it last night. So we talked about wire tapping, he meant surveillance and that there have been incidents that have occurred. Devin Nunes couldn't have stated it more beautifully.

But you choose not to cover that part. You chose not to cover when Tom Cotton went out, when Richard Burr went out, when others, Chairman Nunes and others and said that there was no -- hold on...


SPICER: No, I understand that, Jonathan. And where was your passion and where was your concern when they all said that there was no -- no connection to Russia? Where was it then?

You -- crickets from you guys, because, at the end of the day, when -- no, no, no, no, no. Hold on. Hold on. I'm -- hold on, hold on.


SPICER: I'm making a point. The point is this.

Number one, that it's interesting how when evidence comes out and people who have been briefed on the Russia connection come out and say that there was nothing that they have seen that proves a connection, you choose not to cover that. You don't stop the narrative. You continue to perpetuate a false narrative.

When he came out yesterday and said -- quote -- "I see no evidence that this happened," when he said -- quote -- "I think it's very possible," like I said, we should know that you don't cover that part.

You only cover the part that -- but let's go through what we do know, OK?


SPICER: Hold on. Hold on. Let me -- and I'm trying to answer your question, Jonathan, if you can calm down.

If you look at "The New York Times" report on January 20 -- 2017, it said -- quote -- "In its final days, the Obama administration has expanded the power of the National Security Agency to share globally intercepted personal communications with the government's 16 other intelligence agencies before applying privacy protections. The new rules significantly relax longstanding limits on what the NSA may do with the information gathered by its most powerful surveillance operation, which are largely unregulated by wiretapping laws.

When Sarah Carter reported that by the start of the new year, brought with it unexpected politicizing of the intelligence gathered in secret -- separately, the Obama administration amended a longstanding executive order allowing information intercepted through FISA warrants or by the National Security Agency to be shared by a wider audience and 16 government agencies as Obama was leaving offices.

Intelligence normally reserved for just a handful of intelligence leaders was spread throughout briefings, of -- to scores of workers and, soon, leaks began appearing in news media organizations, often in stories lacking context of how national security investigations are actually concluded.

On March 3, Fox News chief anchor Bret Baier said the following -- quote -- "There was a report in June 2016, a FISA request by the Obama administration, Foreign Intelligence Surveillance Court to monitor communications involving Donald Trump and several other campaign officials. Then they got turned down, then in October. Then they renewed it into a start-up wiretap at Trump Tower with some computer and Russian banks."

Baier continues: "A June FISA request that Foreign Intelligence Surveillance Courts get shot down. A judge says" -- hold on, Jonathan.


SPICER: I'm going to -- you can ask. You can follow up.

"A judge says no go to monitoring Trump Tower. They go back in October. They do get a FISA granted. This is wiretap going on in a monitoring of computers that has some ties, they believe, to Russian accounts. By all accounts, they don't come up with anything in the investigation, but the investigation continues, and we don't know it."

On November 11, 2016, days after the election, Heat Street reported -- quote -- "Two separate sources with links to the counterintelligence community had confirmed to Heat Street that the FBI saw and was granted a FISA warrant in October."

Sean Hannity went on FOX to say -- quote -- "But protections which are known as minimization procedures have been put in place to protect Americans that are not under warrant, American citizens that are caught up in the surveillance."

And -- quote -- "By the way, their identities are protected. Their constitutional rights are to be protected. Now, of course, this was not the case with Lieutenant General Flynn, because we know a transcript of this call was created and then given to intelligence officials, who then leaked this information, which is a felony, to the press that printed it" -- end quote.

QUESTION: So Sean, are you saying...

SPICER: So, Jon...

QUESTION: ... that despite the findings, the bipartisan findings of the Senate Intelligence Committee...

SPICER: No, they're not findings.

There are two -- there's a statement out today. They have not begun this. As you know, yesterday -- or two days ago, the Department of Justice asked for an additional week.

So, they -- the statement clearly says that, at this time, that they don't believe that. They have yet to go through the information. The Department of Justice, as you know, has not supplied this.

But I just read off to you -- it's interesting. When "The New York Times" reports...


SPICER: Hold on. Hold on.


SPICER: Thank you. I appreciate it.



So, are you saying that the president still stands by his allegation that President Obama ordered wiretapping or surveillance of Trump Tower, despite the fact that the Senate Intelligence Committee says they see no indication that it happened?

SPICER: But...


QUESTION: Does the president still stand by the allegation?

SPICER: First of all, he stands by it, but, again, you're mischaracterizing what happened today. The Senate...


SPICER: No, I understand that. And, at the same time, they acknowledge that they have not been in contact with the Department of Justice.

So -- but, again, I go back to what I said at the beginning. It's interesting...


SPICER: Hold on. Hold on.

It's interesting how, at the same time, where were you coming to the defense of that same Intelligence Committee and those members when they said there was no connection to Russia? You didn't seem to report it then. There was no -- no, no...


SPICER: So, you want -- hold on.

You want a comment and you want to perpetuate a false narrative when...


SPICER: But when those individuals have gone out time and time again, when Chairman Nunes has said, number one, that there was no information that he's aware of that that existed, that got zero reporting. Number two, when he went out yesterday and said -- quote -- "I think

it's very possible," you don't include that in the question mark.

The bottom line is that the president said last night that he would be providing -- that there would be additional information coming forward. He -- there's a ton of media reports out there that indicate that something was going on during the 2016 election.

And I think it's interesting. Where was the questioning of "The New York Times" or these other outlets when that was going on? Where was the questioning...


SPICER: I believe he will.


ACOSTA: Yeah, you were just quoting Sean Hannity there. The House and Senate Intelligence Committees are quoting...


SPICER: I also quoted -- I get you're going to cherry-pick...


ACOSTA: You're citing Sean Hannity...

SPICER: No, no, no. OK. You also look over -- you also tend to overlook all of the other sources, because I know you want to cherry- pick it. But -- no, no...


SPICER: But -- but you do. But where was your concern about "The New York Times" report? You didn't seem to have a concern with that.

ACOSTA: We have done -- I have done plenty of reporting on all of this.


SPICER: No, no, but you want to cherry-pick one...


ACOSTA: ... these connections between the...


SPICER: ... one commentary -- one piece of commentary.

ACOSTA: ... associates of the president to the Russians. That has all been looked at and...

SPICER: No, but how do you know all this? How do you seem to be such an expert on this?

ACOSTA: I'm saying that this has been looked at, Sean.


SPICER: How do you know it's been looked at?


SPICER: Hold on. Hold on.

Where is -- I'm sorry. I'm afraid to understand.

Where -- can you tell me how you know that all of this has -- quote -- "been looked at"?

ACOSTA: You're asking me whether or not...

SPICER: You made a statement. You said -- quote -- "All of this has been looked at."

ACOSTA: Other outlets have reported...


SPICER: No, no.

So, OK, so, look, when your outlet says it's all been looked at...


ACOSTA: ... campaign. It sounds like, during the context of that investigation, there might have been some intercepted communications.

The House Intelligence Committee Chairman did mention that. And we have reported that. Others have reported that on our air and various publications.

But, Sean, what you are refusing to answer, the question that you are refusing to answer is whether or not the president still believes what he believes...

SPICER: No, I'm not. I just said it to Jonathan. I didn't refuse to answer that.


ACOSTA: You have the Senate and House Intelligence Committee both leaders from both parties on both of those panels saying that they don't see any evidence of any wiretapping. So, how can the president go on and continue to...


SPICER: Because that's not -- because you're mischaracterizing what Chairman Nunes said. He said -- quote -- "I think it's possible." He is following up on

this. So, to suggest that...


SPICER: Actually, you're stating unequivocally that you somehow...


ACOSTA: ... literally. He said if you take the president literally...


SPICER: Right. And I think that we've already cleared that up. And he said exactly that. But the president has already said, clearly, when he referred to wiretapping, he was referring to surveillance. So that's...


SPICER: So that's...


ACOSTA: It sounds like, though, Sean, that you and the president are saying now, well, we don't mean wiretapping anymore, because that's not true anymore.


SPICER: No, no...


ACOSTA: So now we're going to...


ACOSTA: ... other forms of surveillance.

What's it going to be next?

SPICER: No, no, that's not -- Jim, I think that's cute, but, at the end of the day, we've talked about this for three or four days.

What the president had to -- quote -- "wiretapping," in quotes, he was referring to broad surveillance. And now you're basically going back. We talked about this several days ago.

The bottom line is, is that the investigation by the House and the Senate has not been provided all of the information. And when it does -- but where was the concern...


SPICER: Hold on. I just...


ACOSTA: ... not evidence.


SPICER: No, no. What I -- I think the president addressed that last night. He said there's more to come.

These are merely pointing out that I think there's widespread reporting that throughout the 2016 election, there was surveillance that was done on a variety of people that came up.


ACOSTA: There's an investigation going on into whether there was contact between the president's campaign and the Russians.


SPICER: Jim, I find it interesting that you -- you somehow believe that you...


ACOSTA: Of course they're going to be looking at these...


SPICER: OK. OK. I get it. Somehow, you seem to believe that you have all of this information. You've been read in on all of these things, which I find very interesting.

ACOSTA: I haven't been read in by the FBI.


SPICER: Well, no, you're coming to some serious conclusions for a guy that has zero intelligence...




ACOSTA: Well, give me some credit...

SPICER: I will give you some...


ACOSTA: A little intelligence maybe, but no...

SPICER: Clearance. I wasn't done. Clearance. (CROSSTALK)

ACOSTA: Those two -- those two panels...

SPICER: Maybe both.

ACOSTA: Well, come on.


ACOSTA: Those two panels have spoken with the FBI director.


SPICER: I -- I understand that...

ACOSTA: And told that there's no evidence of this.

SPICER: OK I -- I think this question's has been asked and answered, Jim.


ACOSTA: Just have the president say he was wrong.

SPICER: It's interesting how you jump to all of these conclusions about what they have, what they don't have, and you seem to know all the answers.

But, at the end of the day, there was clearly a ton of reporting...

ACOSTA: A week from now...


SPICER: Hold on, Jim, let me answer.


No, I think that there's been a vast amount of reporting, which I just detailed, about activity that was going on in the 2016 election. There is no question that there was surveillance techniques used throughout this, I think, by a variety of outlets that have reported this activity concluded.

So -- and I think when you actually ask those two people whether or not -- and as Chairman Nunes says yesterday, when you take it literally in wiretapping, the president's already been very clear that he didn't mean specifically wiretapping. He had it in quotes.

So, I think to fall back on that is a false -- is a false premise. That's not what he said. He was very clear about that when he talked about it yesterday.


ACOSTA: Now, all of this sets up an important moment for President Trump.

Tomorrow, he's holding a joint press conference with German Chancellor Angela Merkel over here, Wolf.

And, of course, when the president takes questions from reporters in the room, he is going to be faced with a very important choice. Is he going to call on conservative news outlets who may not ask him about these wiretapping claims that are falling apart, as you saw during the briefing today, or will he call on reporters who will ask that question?

Wolf, that is a moment I think many people here in Washington and perhaps around the world will be watching for tomorrow -- Wolf.

BLITZER: All right, Jim Acosta, we will have live coverage of that news conference tomorrow afternoon.

And, of course, Jim Acosta reporting for us over at the White House.

Let's some get some more on all of this.

Republican Congressman Will Hurd of Texas is joining us. He's a member of the Intelligence Committee, a former CIA operative.

Congressman, thanks very much for joining us.

REP. WILL HURD (R), TEXAS: It is always a pleasure to be on, Wolf.

BLITZER: It must be so extraordinary for you, and I am sure awkward, as a Republican.

The president is still standing by his accusation that Trump Tower in New York City was wiretapped by President Obama, even though we've now heard from the respective leaders of the House and Senate Intelligence Committees, Democrats and Republicans, refute the president's claim. They say they found no evidence backing that up.

What's your reaction?

HURD: Well, my reaction, Wolf, is that everybody needs to be a little bit more precise in the language that we use when it comes to intelligence and federal law enforcement.

These are some serious allegations that we are having to investigate, the Russian involvement and attempts to manipulate our elections, potential leaks of information, of classified information.

These are serious matters that are endangering our intelligence community. And we need to the make sure that we are talking about this in a thoughtful, nonpartisan matter, not going to our corners and using this for a political fight.

BLITZER: But you see the Republican chairmen of the Intelligence Committees, they are backing away, they're disputing what the president is saying. Shouldn't the president be very, very precise in making a serious

allegation like this against his predecessor, President Obama, when he tweets: "Terrible, just found out Obama had my wires tapped in Trump Tower before the victory. Nothing found. This is McCarthyism" and then three more tweets on that early Saturday morning and nearly two weeks ago, leveling further charges?

Before he does that, shouldn't he be precise and check with law enforcement, check with the intelligence community to see if there is any truth to what some news media outlets were suggesting?

HURD: Wolf, I just spent 36 hours in a car live-streaming everything I was saying in the vehicle. And so I understand the importance of being precise.

The president is the most watched person in the world. And precise language is important. And he has a very large organization at his fingertips. And this is something that let federal law enforcement do their jobs. Let the Intelligence Committees on both the House and the Senate do our nonpartisan and bipartisan review of what's going on and go about running the country.

BLITZER: Yes, because -- and it was pretty extraordinary today at that White House briefing.

Sean Spicer read from these various news accounts, including from Sean Hannity of FOX. He then quoted a media commentator for FOX, Judge Andrew Napolitano, suggesting that maybe that British intelligence spied on President Trump.

A spokesman for British intelligence, the GCHQ, tells CNN -- and I'm quoting now -- "Recent allegations made by media commentator Judge Andrew Napolitano about GCHQ being asked to conduct wiretapping against then president-elect are nonsense. They are utterly ridiculous and should be ignored."

It's pretty extraordinary to hear the White House spokesman quoting these kinds of sources. Is that your reaction as well?

HURD: Well, one of the things that is frustrating for me, as a former intelligence officer, is that we consider information from unnamed intelligence sources as if it is intelligence.

In my former life, we would call that information. And not knowing the source of the information, you can't speak to the credibility of it.


But also quoting press alone is not confirmation like you would get from the FBI or the intelligence communities. So, you know, I have said a lot, and I think we have talked about this too, Wolf, one of the greatest successes of Russian intelligence is that their activities have created a wedge, whether real or perceived, between the White House, the intelligence community, and the American public. And this kind of conversation, this kind of bickering, this kind of partisan fighting is creating a problem. And it is putting our intelligence services in danger.

We should let the men and women go about to do their job. And that's why Congress is here to provide oversight, to review law enforcement and intelligence. As if we could allow that process to unfold, I know the American people demand and deserve questions.

But when it comes to law enforcement, intelligence, sometimes, these things take a little bit of time. But I will say this. Being on the House and Intelligence Committee, I take this matter very seriously and making sure that any investigation is done in a through and bipartisan way.

BLITZER: But when you hear the Republican speaker of the House, Paul Ryan, say he's seen no evidence to back up the president's claim, when you see the chairman of the Senate Intelligence Committee, Richard Burr of North Carolina, another Republican, say he's seen no evidence, it's not necessarily partisan. It is bipartisan disputing the president's allegations.

So, here's the question. People all over the world -- and you served all over the world in the CIA -- they're watching what the president is tweeting, what he's saying. Doesn't this impact his credibility and the credibility of the United States right now?

HURD: It has an impact on credibility, for sure.

But we also have a co-equal branch of government, and most people around the world know that. That's why I think the American people should feel good and that the process is working, is that you have people from the same party as the president disagreeing with the president.

And that's what makes our government so effective. That's why people should be happy to know that this process is unfolding in a bipartisan manner, in a separate, but equal branch of the government. So, this is -- this is important and it shows that our government is working.

BLITZER: Put on your hat now as a former CIA operative, now a key member of the House Intelligence Committee, Congressman,.

Last night, in an interview with FOX, President Trump confirmed publicly that the Central Intelligence Agency was hacked during the Obama administration years.

You saw those WikiLeaks releases that came up just a few weeks ago. And you have heard from intelligence experts say, you know what? You are not supposed to confirm that kind of information. And some are suggesting that the president, by doing so, mishandled classified information.

What's your reaction?

HURD: Well, the question is the review of those WikiLeaks documents is still ongoing, and how that information and whether information from actually the intelligence community was leaked is still ongoing.

So, I think those are inaccurate statements. And, again, this is why, when it comes to intelligence and law enforcement information, it is best to let the professionals do their job and wait until that happens to speak about it.

BLITZER: Well, was it a blunder for the president to publicly say the CIA was hacked?

HURD: I probably would not have done that if the roles were reversed.

But the president is seeing things that I am not seeing, so I leave it up to him to make those decisions.

BLITZER: The president has the authority to declassify any classified information he wants. You don't have that authority. If you had done that, Congressman, I can assure you, you would have been deep trouble right now, as you well know.

I want you to stand by, because there are new revelations about the fired national security adviser, Michael Flynn, that are coming into THE SITUATION ROOM, receiving a substantial payment from Russian television.

Much more right after this.



BLITZER: We are back with Republican Congressman Will Hurd of Texas. He's a member of the Intelligence Committee.

Congressman, stand by.

I want to get some breaking news we're following, a new revelation about the fired Trump national security adviser, Michael Flynn, and Russia.

Our chief security national correspondent, Jim Sciutto, has got some details.

Jim, this concerns a speech Flynn delivered in Moscow.


And two issues here, Army regulations and the law. The Army requires that if you take a payment as a retired officer from a foreign government, you have to report that payment. The Army tells CNN it has no record of Flynn reporting this payment.

More importantly, the law requires, if you take a payment from a foreign government, you have to include this in your application for a security clearance. We have asked Flynn's spokesman -- I spoke with him today -- as to whether he reported that in his security clearance. They had no comment.

And we know the House Oversight Committee has asked that question. They don't yet have an answer.


SCIUTTO (voice-over): Recently fired National Security Adviser General Michael Flynn was paid tens of thousands of dollars by Russian state television for this speaking engagement in Moscow in 2015, potentially violating the law and U.S. Army regulations.

MICHAEL FLYNN, FORMER NATIONAL SECURITY ADVISER: I am going to be really, really provocative here.

SCIUTTO: The Kremlin-funded news agency Russia Today, or R.T., which hosted the event, paid Flynn $33,750 for his appearance, this according to documents obtained by the House Oversight Committee.

In interviews last year, Flynn acknowledged accepting payment for the speech but denied being paid by the Russian government.

[18:30:14] LT. GEN. MICHAEL FLYNN (RET.), FORMER NATIONAL SECURITY ADVISOR: I didn't take any money from Russia, if that's what you're asking me.

UNIDENTIFIED MALE: Well, then who paid you?

FLYNN: My speaker's bureau. Ask them.

SCIUTTO: Documents obtained by the Oversight Committee indicate, however, that the money was coming from RT. E-mails show an official of RT Russia first haggling over Flynn's fee. Quote, "The speaking fee is a bit too high and exceeds our budget at the moment. So we had to negotiate it with the management. Do you think there is any possibility to reduce the price to $45,000?" And then confirming that RT would provide the funds. Quote, "We will be covering the payments of General Flynn's fee from our London office."

The U.S. intelligence community has long assessed RT to be a propaganda tool of the Kremlin, writing in its January report on Russian interference in the U.S. election that the organization had participated in disinformation campaigns aimed at the U.S.

U.S. intelligence first determined RT was backed by the Kremlin in 2012, when Flynn was head of the Defense Intelligence Agency.

Price Floyd, spokesperson for Flynn, told CNN today, quote, "General Flynn reported the trip to the DIA both before he went to Russia and after he returned.

FLYNN: We have created some of these problems...

JOHNS: However, Flynn was required to do more than simply report the speech. Representative Elijah Cummings, the ranking Democrat on the committee, has asked the White House, FBI and Pentagon whether Flynn appropriately reported the payments on his security clearance form, as required by law. His spokesperson declined to comment.


SCIUTTO: Cummings also accuses Flynn of violating military regulations that prohibit retired officers from receiving payments from a foreign government. Flynn would have had to seek approval from the Army for such a payment, something that the Army tells CNN it has no record of.


SCIUTTO: The Oversight Committee found that Flynn took two more payments from other Russian agencies and entities: more than $10,000 from a Russian air cargo company, more than $10,000 from a Russian cyber security firm, those not tied to the Russian government. But keep in mind, Wolf, of course, this was all happening as Russia was interfering in the U.S. election process beginning this hack, which was later identified by the U.S. intelligence community -- Wolf.

BLITZER: All right. Solid reporting by Jim Sciutto, as usual. Thanks very much.

Let's bring back Congressman Will Hurd, a member of the Intelligence Committee. Let me get your reaction, first, to what we just heard. What do you think?

REP. WILL HURD (R-TX), INTELLIGENCE COMMITTEE: Well, I think there's going to be a lot of questions on March 20. The House Intelligence Committee is going to have the director of the FBI, Mr. Comey; and the director of the NSA. And I'm sure this line of question will probably be pursued. You know, for having spent 9.5 years in the CIA, I'm suspicious of Russia Today and its ties to the government. You know, it's seen as a propaganda piece for the government of Russia. And folks that have spent time in the intelligence community should be aware and know that.

BLITZER: Are you concerned -- or how concerned are you -- I assume you are -- that President Trump elevated General Flynn to a position of great influence, national security adviser within the White House, without necessary digging into all of these questions? Does it raise questions about his judgment?

HURD: Well, I think the president is a guy who relies on his gut and first instincts. I think the decision for Mr. Flynn stepping down was the right decision. And I think the national security adviser that we have now, General McMasters, is a fantastic choice and is a good example of strengths for the Intelligence Committee.

I would agree, when you look at this election, Mike Pompeo as the director of the CIA is a fantastic choice, Dan Coats for DNI and, of course, General Mattis, who I think was approved 99-1, if I'm not mistaken, or 98-1. So we have some good folks managing the intelligence community now.

BLITZER: Yes, and General McMaster over at the White House, now the national security advisor, highly regarded, as well. General Kelly over at the Department of Homeland Security also. There's a bunch of qualified people.

Before I let you go, a very, very different matter because you and your colleague, Congressman O'Rourke, you had a creative solution to this snowstorm of flight cancellations. You road tripped, what, all the way from Texas to Washington, D.C. And you were live streaming along the way. Tell us about that?

HURD: Well, Wolf, we left from San Antonio, Texas, and drove a Chevy Impala 1,700 miles to Washington, D.C. It was a 36-hour trip. Thirty-one of those hours were in the car. And I think we ultimately livestreamed about 30 of those hours.

[18:35:11] It was a rolling tele-town hall. We took questions, every issue imaginable. WE discussed many times.

And the idea was we say that we could be -- you know, we were focused on what divides us a lot, especially in the press, instead of talking about what unites us. And this was an opportunity for Beto O'Rourke from El Paso and me to talk about the things that unite us and also to show that you can disagree without being disagreeable. And we were surprised by how many people watched and stayed with us the whole time and how many people really appreciated what Beto and I were doing.

BLITZER: Nice bipartisan road trip indeed.

All right. Congressman, as usual, thanks very much for joining us. Will Hurd of Texas.

HURD: Thanks a bunch, Wolf.

BLITZER: All right. Just ahead, more on the breaking news. The White House secretary blasting the news media over its coverage of President Trump's wiretap claim.


[18:40:44] BLITZER: Breaking news tonight, the White House press secretary is defending President Trump's claim during a rather contentious news briefing, in which he blasted reporters for their coverage of the president's unsubstantiated claim.

Let's get some more with our experts and our analysts. Jim Sciutto, I'm glad you're back.

They're standing by the president's -- President Trump's claim that President Obama personally ordered wiretapping of Trump Tower. Even though the heads of the Intelligence Committee, Republicans and Democrats, the speaker of the House, they're all saying they've seen no evidence to back it up. And they did have briefings, highly classified briefings with top law enforcement and intelligence officials, but the White House still standing by the president's tweets.

SCIUTTO: Let's just say the president's claim is not true. Everyone briefed on it, Republican or Democrat, the Republican and Democratic most senior members of the Senate Intelligence Committee, the president's appointee as attorney general, the FBI director, they have all said this is not true. They've seen no evidence of it.

Now, what's happening is that you have both the president and his spokesman, Sean Spicer, redefining what the allegation is, redefining the terms. Just to remind our viewers, the allegation was President Obama ordered the tap. The target was Trump. And it was a wiretap, not just some sort of general form of surveillance.

They're now saying, "Well, it wasn't necessarily Obama doing it. It wasn't necessarily me that was the target, Trump." It was just the possibility that Trump advisers were caught up in other forms of surveillance. That's an entirely different thing.

CNN has reported that advisers to Trump were captured communicating with Russian officials and other Russians known to U.S. intelligence. This is part of routine intelligence gathering, because Russian officials and others known to U.S. intelligence, other Russians known to U.S. intelligence, are the targets of U.S. surveillance as a matter of national security policy. For instance, a Russian ambassador to the U.S. That stuff is hoovered up by the NSA as part of -- as part of their general surveillance.

We know that Trump advisors were the other end of some of those conversations. But again, that's not what the president accused President Obama of, and that's got to be very clear. Despite all the sort of somersaults you're hearing from the podium at the White House and the president himself, that's not what the president said.

BLITZER: Yes. In one of his tweets he said, "How low has President Obama gone to tap my phones during the very sacred election process? This is Nixon Watergate. Bad or sick guy."

And listen, Jackie, to the president, in that FOX News interview, explaining himself.


DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES: I think it was January 20, a "New York Times" article, where they were talking about wiretapping. There was an article. I think they used that exact term.

Your friend Bret Baier, the day previous, where he was talking about certain very complex sets of things happening and wiretapping. I said, "Wait a minute. There's a lot of wiretapping being talked about." They did write on January 20 using the word "wiretap."

If you watched the Bret Baier and what he was saying and what he was talking about and how he mentioned the word "wiretap," you would feel very confident that you could mention the name. If you take a look at some of this things written about wiretapping and eavesdropping. You know, when I say "wiretap," those words were in quotes. Because wiretapping is pretty old-fashioned stuff. But that really covers surveillance and many other things.

And nobody ever talks about the fact that it was in quotes. But that's a very important thing. "Wiretap" covers a lot of different things.


BLITZER: Yes. We looked at those four tweets. Two of them were in quotes, "wiretapping." Two were not in quotes. But go ahead.


It doesn't make a lot of sense, unless you're trying to justify something that you don't have any evidence for. And that's sort of what the president and his advisers are doing at this point. Every -- every congressional committee that has been vested with this, Speaker Ryan. Anyone who has clout at this point and FBI Director Comey has said either, you know, on background when it comes to Comey or on the record when it comes to the Intelligence Committee, that there's no evidence to support what the president tweeted.

So they're trying to figure out a way where he can't be wrong, because he doesn't like to admit when he's wrong. But here's the thing. There is an intelligence hearing on Monday, and Director Comey is supposed to -- is expected to testify about this on the record and that there is no evidence to support those. So it's not going the get any less complicated for the White House.

BLITZER: We expect, according to Intelligence Committee members, that Comey will publicly say what he has said privately: no evidence to back it up. The director of the National Security Agency, Admiral Mike Rogers, he's also testifying in open testifying in open sessions, presumably he will say the same thing.

So, if they all do, will the president be held accountable?

DAVID SWERDLICK, CNN POLITICAL COMMENTATOR: Well, I think it depends on accountability, right? In terms of his supporter, he went up three points this week in the Gallup daily tracking poll of presidential approval. So, I do think there is a floor past which he won't go with the people that were supporting him all along, people sort of like this media against the world that he's taking with the media and basically everybody, you know, with regards to the story.

On the other hand, I do think you see members of Congress starting to back away from him at least on this issue and this is going to make it tougher for him to move his agenda forward on a variety of fronts, as we go forward.

BLITZER: So, he's going to have a credibility problem assuming on Monday during this House Intelligence Committee hearing and open session, all the leaders of the intelligence community, in the law enforcement community, saying they see no evidence to backup what the president claims.

REBECCA BERG, CNN POLITICAL ANALYST: Right. Well, I would say he would have a credibility problem, Wolf, with lawmakers, and with us in the media. But I think it's an open question whether the president will have a credibility problem when it comes to Americans, when it comes to voters. We saw this multiple times during the campaign. Donald Trump would throw something out there that was baseless, unsubstantiated, later proved to be false. You can think of a number of instances.

And yet, throughout the campaign, consistently, he outpaced Hillary Clinton on the metric of, is he is untrustworthy, and he continued to, in spite of these baseless, unsubstantiated, false claims that he was making throughout the campaign.

I think the root of this is just sort of a widespread cynicism about American politics. People don't necessarily expect their politicians or their government officials to be straightforward, honest or trustworthy. And so, if they see Donald Trump saying things that aren't true, maybe they don't care as much because that's what they expect. It's unfortunate to say the least and you would hope that politicians and lawmakers actually do put a lot more stock in the truth, but it's possible that Americans won't care about this

BLITZER: I interviewed Speaker of the House Paul Ryan in the last hour. Let me play this excerpt.


BLITZER: Can you name specific members that the president has turned from no to yes?

REP. PAUL RYAN (R-WI), SPEAKER OF THE HOUSE: Oh, I'm not going to get into all that. Only I say, it's not my bill, it's our bill, it's the American Health Care Act.


BLITZER: Talking about the repeal and replacement of Obamacare. And take a look at this shortly after that exchange, the president tweeted this, "Great progress on healthcare. Improvements being made. Republicans coming together".

Because, Jackie, I mentioned I don't know if he was watching us, but coincidentally, I had mentioned, we are not hearing a lot from the president and they're not really -- he's not tweeting about repealing and replacing Obamacare all that much, and all of a sudden, that tweet emerged.

KUCINICH: Here's the thing -- we'll know the answer to this. They're going to have a vote on this.

But here's the question: where this moves? Does it move further to the right to appeal Freedom Caucus members who want less things, parts of Obamacare on this bill, or does it move to the moderate, the people that they're going to need to keep their majority at some point? We'll have to see but you can't please both groups at this point, that's for sure.

BLITZER: What do you think?

SWERDLICK: I think Speaker Ryan probably has to have whiplash. President Trump is keeping just enough distance from the bill to be able to plausibly deny it if things go wrong for Republicans, either by not being able to pass it or passing and people not liking it. But sending out tweets like that just enough to be able to keep this open dialogue with House leadership.

KUCINICH: But he's going to own up to it either way, that's the point --

SWERDLICK: Oh, I agree, Republicans writ large are going to own it -- yeah.

BLITZER: How much trouble is this repealing and replacing Obamacare in right now?

BERG: Well, I think you can judge a lot by the fact that the White House and the Trump are keeping their distance, Wolf, that he's acting pretty agnostic about this bill as it stands currently, and that's because Donald Trump cares about his public perception and cares about looking like a winner. If he thinks this does not pass, he does not want to attach himself closely to this bill just yet.

What I'm hearing is that the White House is very much in negotiating mode. They met with senators earlier this week in the West Wing, some top White House aides, and they were asking them, you know, what do you want to see from the final bill? What changes might we make?

BLITZER: You know what else is in trouble, Jim Sciutto, travel ban 2.0. Two federal judges have said, you know what, it's not going forward. There are some legal issues right there.

JIM SCIUTTO, CNN CHIEF NATIONAL SECURITY CORRESPONDENT: No question. It's interesting. It surprised some lawyers that I have been talking to because they looked at this revised travel ban and they said that it's pretty tight legally, at least on the language. But what we saw happened, particularly with the Hawaii judge is moving beyond the executive order itself and going to the past statements and recent statements by Trump and Trump advisers, tying this to a religious test, the Muslim ban.

The question is, does that challenge go all the way to the Supreme Court and what happens there?

[18:50:03] And is Gorsuch in place by the time you get there?

BLITZER: Let me get your reaction to what the president said last night in the interview on fox. He had this to say and some are suggesting he may have revealed classified information. Listen to this.


DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I just want people to know, the CIA was hacked and a lot of things taken. That was during the Obama years. That was not during us. That was during the Obama situation.

(END VIDEO CLIP) BLITZER: Adam Schiff, the ranking Democrat in the House Intelligence committee, saying, you know what, the president may have revealed classified information.

SCIUTTO: Interesting and if he did in that context he was basically trying to defend himself, one, take a shot at the Obama administration, saying it happened then but also sort of draw attention away from the eavesdropping issue perhaps, et cetera. Was he willing to go so far as to reveal something he got in one of his classified briefings? We don't know that. But Adam Schiff, he's briefed on this kind of stuff, he's the ranking member in the House Intelligence Committee. That will be an interesting question to see answered.

BLITZER: Yes, the president alone, he can declassify anything he wants and not get into trouble. But if another official had said what the president said, they're talking about the CIA being hacked.

SCIUTTO: Sounds a little like a leak to me, Wolf.


BLITZER: We're not supposed to confirm that kind of information.

All right. Much more on the breaking news right after this.


[18:55:58] BLITZER: A grand jury indictment is shedding new light on a bribery and sex scandal allegedly involving senior U.S. Navy officers and a defense contractor known as "Fat Leonard".

Brian Todd has been digging into this for us.

What are you learning, Brian?

BRIAN TODD, CNN CORRESPONDENT: Wolf, prosecutors are calling this a fleecing and a betrayal of the U.S. Navy of epic proportions. They say this group of naval officers was so brazen in their corruption that they gave themselves nicknames like the "Cool Kids" and the "Band of Brothers".

Tonight, we've got new details on this case which has severely shaken the Navy.


TODD (voice-over): The 7th Fleet, the Navy's largest. Its motto, "Ready power for peace."

But according to a new indictment, some of the fleet's commanders were also ready for parties and prostitutes. Prosecutors say retired Rear Admiral Bruce Loveless and eight other officers accepted luxury travel, expensive dinners and prostitutes, and in return, gave a civilian contractor classified information about their ships' movements. CMDR. KIRK LIPPOLD (RET.), FORMER COMMANDER, USS COLE: This is beyond

the pale. When you look at the ranks and level of officers involved in this scandal, it is something the Navy has not dealt with literally in decades.

TODD: According to the indictment just unsealed, when some of the officers docked in Manila in 2007, they went to a party at the McArthur Suite in the Manila Hotel. Quote, "During the party, historical memorabilia related to General Douglas McArthur were used by the participants in sexual acts.

LIPPOLD: Totally disgusting. There is absolutely -- when you look at that, that is the history of the United States of America, and to take those artifacts and embarrass General McArthur's family in that manner, being used in what is purported to be those sexual acts, it's just -- I -- there's no words that can describe it.

TODD: The contractor who allegedly supplied the lavish gifts and parties was this man, Leonard Glenn Francis, also known as "Fat Leonard", a wealthy, flamboyant executive who ran a marine contracting agency which provided dockside services to U.S. Navy ships. Fat Leonard Francis has pleaded guilty in the case and is awaiting sentencing. But until now, many of the details of what happened were not public.

In May 2008, according to prosecutors, Francis allegedly paid for Admiral Loveless and five other Navy men to stay at the Shangri-la Hotel in Manila. In the indictment, prosecutors write Francis hosted a raging multiday party with a rotating carousel of prostitutes in attendance during which the conspirators drank all the Dom Perignon available at the Shangri-La to the tune of more than $50,000.

For some officers in 2006, there was a dinner in Singapore with foie gras terrine, duck leg confit, roasted Chilean sea bass, followed by expensive drinks and Cohiba cigars, $2,000 per box.

Prosecutors say, in return, the officers helped steer Navy ships to ports operated by Francis where he overbilled the Navy tens of millions of dollars. Experts say Admiral Loveless, who is a top intelligence officer, and the others charged took massive risks that could have exposed American secrets.

JOHN ALTENBURG, FORMER ARMY JAG OFFICER: They're susceptible to being blackmailed by foreign intelligence agencies, by other corporations, by this person himself who they've been involved with.


TODD: Experts say given that this all allegedly happened in the Asia- Pacific theater, Chinese spies could have gotten wind of the alleged bribery going on. We contacted an attorney for Admiral Loveless who said neither he nor his client would comment on this case -- Wolf.

BLITZER: Brian, this investigation has been going on for some time, right? TODD: That's right, Wolf. Fat Leonard Francis was arrested in 2013 in a sting operation that lured him from Singapore to San Diego. He has pleaded guilty and court papers indicate he's been cooperating with authorities. They may have gotten some of this information on the navy officers from him.

BLITZER: Yes. All right. Brian Todd doing excellent reporting for us as he always does. Thanks very much.

And to our viewers, thanks so much for watching. I'm Wolf Blitzer in THE SITUATION ROOM.

"ERIN BURNETT OUTFRONT" starts right now.