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Manafort Charged in Russia Probe; Gates Charged in Russia Probe; No White House Response; Manafort and Gates Indictment Released. Aired 9-9:30a ET

Aired October 30, 2017 - 09:00   ET


[9:00:00] CHRIS CUOMO, CNN ANCHOR: No, we'll see what he says.

ALISYN CAMEROTA, CNN ANCHOR: Gentlemen, thank you very much for helping us with all of this breaking news and all of your expertise.

CNN's breaking news coverage continues with "NEWSROOM" with Poppy Harlow and John Berman.

ANNOUNCER: This is CNN breaking news.

POPPY HARLOW, CNN ANCHOR: All right, a lot to get to this Monday morning. Good morning, everyone. I'm Poppy Harlow.


Major breaking news this morning. It has begun. Former Donald Trump campaign chair Paul Manafort surrendered to authorities this morning. This happened in the last hour. These are the first criminal charges in the investigation from Special Counsel Robert Mueller. Who knows whether they are the last.

We also just learned that key Manafort associate Rick Gates has turned himself in.

HARLOW: It began as an investigation into Russian meddling in the U.S. election, but it has clearly, clearly expanded far beyond that. We do not yet know the nature of the charges this morning. The indictment is still sealed at this hour. But that could become clear any moment as it is unsealed.

As for Manafort, remember, this is the man who was in charge of all of the president's campaign for five months during key moments, including when he sealed the Republican nomination.

Let's get straight our Justice correspondent, Evan Perez, part of the team that broke this news this morning.

Evan, so much to get through with you, but just begin with what we know and what we're waiting for.

EVAN PEREZ, CNN JUSTICE CORRESPONDENT: Well, Poppy and John, we know that the -- that the two men, Manafort and Gates, were notified this morning that they were to turn themselves into the FBI, and they have now done so. They're being processed right now, photographed, and then they're going to go over to the federal courthouse, where they're going to be read the charges for the first time.

Now, even at this hour, the charges have not been unsealed. As we reported on Friday, the grand jury in Washington had returned these indictments, but we didn't know what the charges are and we still do not know.

We do know, however, there's some -- we do know that there's been some hints given to these men about what the nature of this investigation is. And in particular with Manafort, we know that he's been told that he was likely to face charges related to tax and financial crimes. We know that Bob Mueller's team has been looking as far back as 2005 as part of this investigation. And we also know that the tax year 2010, which would have been filed in 2011, is of particular interest to them. Again, these are part of conversations that his attorneys have had with the Mueller investigators.

The reason for me mentioning the 2010 tax year is that the statute of limitations on that tax year runs out this month. And that might be part of a clue here as to why we're seeing these charges. The month ends tomorrow. So perhaps prosecutors were trying to beat the clock.

So one of the things we do -- one other thing we do know about this is that we don't expect this to be the end. We expect fully that this is just the beginning of this. That they're going to file these charges and then will continue their investigation and perhaps add additional charges in a superseding indictment at some later date.

Again, we're looking to see whether or not there's any mention of Russia, whether there's any mention of the campaign in these charges when they're unsealed later today by a judge. That will, I think, really drive the conversation as to what Mueller and his investigators have been around -- have been doing these last five months.

Bob and -- sorry, Poppy and John.

BERMAN: Evan Perez, thank you so much for that reporting.

HARLOW: Thank you.

BERMAN: We'll let you get back to work right now because this news is coming in fast and furious.

Let's go over to the federal courthouse right now in Washington, D.C. This is where Paul Manafort and Rick Gates will be taken after they're processed at the FBI field office, where we believe they are right now.

CNN's Jessica Schneider at the courthouse.

What will happen to them? How will this process work out, Jessica?

JESSICA SCHNEIDER, CNN JUSTICE CORRESPONDENT: Well, John, we are expecting Paul Manafort. He could be here at the federal courthouse at any time. Since, of course, he turned himself in right around 8:00 a.m. We know that processing typically takes about an hour.

He will be transported to the district courthouse here by federal authorities. That's when he'll have that arraignment, where he'll be presented with the charges against him. The judge will explain what he's facing and what the maximum criminal penalty is for those charges.

Of course, as Evan mentioned, the indictment has not yet been unsealed. It has not been made public just yet. But when Paul Manafort does appear in court and later Rick Gates on other charges, those charges will be made public. We will know about them.

Of course, Paul Manafort will go before the judge. The judge will explain those charges. And then we also know that there could be -- it's likely that Paul Manafort, at that point, will plead not guilty. There could also be some sort of discussion about future hearings, as well as any bail that would be set. Of course, a lot of times in these white collar criminal cases, these defendants are often released on their own recognizance. Some limits might be set as to where he may go, a curfew, perhaps. So that is what will happen here in court.

Of course, this is an initial proceeding, an arraignment where those charges will be laid out. But we know that Paul Manafort will be here perhaps soon this morning when the courthouse opens. And that's when he will appear before a judge. Those charges will finally be laid out. That indictment will be unsealed. And it will all be presented in public view before the court.

[09:05:16] Of course, we do know that in addition, Rick Gates has turned himself in. The processing is also happening at the FBI field office just a few blocks from here. Rick Gates will also be transported here to federal court a little bit later this morning as well.

John and Poppy.

HARLOW: All right, Jessica Schneider at the courthouse. Again, this could happen any minute because he turned himself into the FBI about an hour ago. Processing, as Jess said, takes about an hour.

Let's get to the White House, see if the president is reacting this morning. Joe Johns is there.

Joe, any word?

JOE JOHNS, CNN SENIOR WASHINGTON CORRESPONDENT: No word at all. Nothing of substance at least so far from the White House. The White House communications team was in a meeting when the news broke and that meeting has since broke up. We haven't heard anything.

I did speak to one White House spokesman and asked if they were waiting to find out what the charges are and was told, we may not have a response at all. That was later amended to, we don't know exactly when we will have a response.

Not even sources familiar with the thinking of the president's legal team have been weighing in. But, in the past, those sources familiar with the thinking of the legal team have said that while players like Paul Manafort, Rick Gates, and others may have come under scrutiny and may have even go gotten into legal trouble, that has never reached the level of the president himself, the Oval Office. And there's no reason to think, at least so far, that any of that thinking has changed.

Back to you.

BERMAN: All right, Joe Johns for us at the White House. Keep us posted if we do hear anything from there.

Joining us now is CNN legal analyst Jeffrey Toobin and Susan Hennessey and CNN crime and justice reporter Shimon Prokupecz.

Jeffrey --


BERMAN: The president's campaign chair is in the FBI field office right now surrendering to the FBI. He will be charged with crimes today.

TOOBIN: That's a very big deal. And, you know, I -- seeing Jessica in front of this courthouse, this is a very historic place in Washington history. This is where the Watergate defendants, the cover-up trial of H.R. Haldeman and John Mitchell was. It's where I was privileged to be one of the prosecutors in the Oliver North case. It's where Hillary Clinton testified in the grand jury in the Whitewater case.

UNIDENTIFIED MALE: The indictments are out guys. Can I interrupt?

TOOBIN: And it's -- is someone saying that the indictments are out?

HARLOW: Yes, we'll get --


BERMAN: Shimon Prokupecz just told us the indictments are out. We hope Shimon is reading them right now.

HARLOW: Yes, we're going to give him a minute.

BERMAN: Jeffrey, finish your statement.

TOOBIN: Well, it's just -- this is an important moment in U.S. history. I mean this is no joke. The fact that the campaign manager of a winning candidate for the president of the United States is indicted less than a year after that president takes office suggests that we are in an important moment. Doesn't mean he's guilty. Doesn't mean Rick Gates is guilty.

HARLOW: Right.

TOOBIN: But the very fact that a grand jury has taken this action is a moment we should pause to consider.

HARLOW: All right, and our viewers probably just heard what we heard from Shimon, saying the indictments are out.

Shimon, we're going to give you a moment to read through them. You let us know when you are ready.

SHIMON PROKUPECZ, CNN CRIME AND JUSTICE REPORTER: I mean I can read some of the stuff at least.


PROKUPECZ: This has now just now been released by the press offices of the special counsel. So just bear with me here. But here's basically the first line.

It says, Paul Manafort, 68, of Alexandria, Virginia, and Richard Gates, 45, of Richmond, Virginia, have been indicted by a federal grand jury on October 27th, in the District of Columbia. The indictment, it goes on to say, contains 12 counts, conspiracy against the United States, conspiracy to launder money, unregistered agent of a foreign principle, false and misleading FARA (ph) statements, false statements and seven counts of failure to file reports of foreign bank and financial accounts.

So there we now know. We have some idea, at least, of what the charges are. And a lot of it is what we've been talking about, that it's going to have to deal with financial crimes. Paul Manafort's work and now Rick Gates' work overseas with Ukraine and possibly other countries. And this is what we've been reporting for some time now, that this is where the focus of some of the special counsel's investigation has been.

HARLOW: All right, Shimon, thank you.

And, Susan, let's bring you in. Let's just explain to people who Rick Gates is. A lot of people know who Paul Manafort is because he chaired the president's campaign. Rick Gates is someone -- a political consultant who has been by Manafort's side for decades, who worked along with him on the Trump campaign, even beyond Paul Manafort. When Paul Manafort stepped down, Rick Gates, Susan, as you know, kept working with the president on the inaugural committee and then raising $25 million for a big PAC that supports the president, until April, when he was ousted because of concerns on these Ukraine dealings. What are your thoughts this morning?

SUSAN HENNESSEY, CNN NATIONAL SECURITY AND LEGAL ANALYST: Right. So one of the things we've seen sort of as the president's tactics in the past is, wherever bad news has come out about individuals sort of related to him, he really tries to distance himself pretty quickly, right? They weren't a big part of the team. Steve Bannon came on very late.

[09:10:06] So what's going to be relevant here is, of course, how sort of -- how strongly they try and distance themselves from Paul Manafort. That's going to be difficult considering his prominent role in that campaign. And then how do they try and distance themselves from Rick Gates? What's going to be hard about Rick Gates, as you mentioned, is that he

actually stayed on, was part of the inaugural committee. So that's going to make it far more challenging for the Trump team to say, hey, look, we didn't know anything about any of the suspicions around these people. As soon as we found out, they were sort of bit players, we pushed them out and right there -- essentially their behavior doesn't reflect on us and doesn't reflect on our judgment.

BERMAN: Jeffrey, when Shimon was reading the 12 counts, the first one was conspiracy against the United States.

Shimon, was that accurate? Because we're just piecing through this document right now.


PROKUPECZ: Yes. Yes, that is accurate, and that's what the press release said. I now have a copy of the indictment, so I'm going through it to see exactly what that means. But Jeffrey may have a better idea.

TOOBIN: So am I. It is -- it relates to tax offenses --


TOOBIN: Among other things. But, I mean, I think what's striking, initially -- first of all, you know, this is a 31-page indictment. That's a very long indictment. Indictments are often much shorter than this. And it deals with financial dealings, primarily, but not exclusively.

And I think it mostly deals with Manafort and Gates' personal finances, money laundering, using the money they got from the Ukraine to hide it from the tax authorities, not to report it properly. That's my initial impression. But I have to admit, I'm still just going through it and I haven't -- I haven't gotten to the end. It's long.

HARLOW: So a few things here.

Susan, you know, Jeffrey rightly brings up Ukraine. And we know that Manafort and Gates worked for Ukraine for about a decade. Worked for Viktor Yanukovych's government. Obviously, you know, friendly with the Putin regime until he was ousted a few years ago.

Remember in the last year or so a ledger, a hand-written ledger, was found with over $12 million in payments that was supposedly from the Yanukovych regime to Manafort. And Manafort said that was all made-up.

Now, why is this tied to this, maybe? Well, Evan Perez was reporting earlier that 2010, that tax year, when he was also working for the Ukrainian government, is of key interest to investigators right now.

HENNESSY: Right. So one of the things that's sort of important to keep in mind, even once we've seen the indictment is, the nature of what a tax charge might mean. So the government often uses tax charges as a way to indict someone. And so it could be that they're indicting Paul Manafort for failure to pay income on -- failure to pay taxes on legitimate income, right? So, sort of there's nothing wrong with the original source of the income and he didn't pay taxes and that's where the criminal activity comes in.

It's also possible that the government is using tax or fraud charges in order to go after illegitimate sources of income. So in -- so perhaps it's too difficult to prove sort of the more complex money laundering or other charges related to where the source of that income might have been. So instead they say, look, we have reason to believe you have this illicit income. We know that you didn't pay taxes on that. We can prove that element of it. And so they start there.

So even though we're starting to get sort of the first concrete information in this indictment, there's still a lot of open questions related to, what is the underlying conduct here? And, really, you know, the full scope of that 31 pages and then information that's going to trickle out over the next sort of days and weeks and hours.

BERMAN: Let me read for you something from page one right now and there are 31. We're piecing through it right now. Manafort and Gates generated tens of millions of dollars in income as a result of the Ukraine work. In order to hide Ukraine payments from the United States authorities from approximately 2006 through at least 2016 -- so this went up through the election year -- Manafort and Gates laundered the money through scores of U.S. and foreign corporations, partnerships, and bank accounts.

Again, Jeffrey, we'll keep on reading through this.



BERMAN: Go ahead.

TOOBIN: But I think a very significant point -- two points. One, the Trump campaign is not mentioned in this indictment. I have gone though it once. And that's, I think, a very important point.


TOOBIN: And it is certainly something you will hear from the president's supporters. And I think it's a very valid point. There -- it does not include any reference to his work on the Trump campaign.

However, it also does include statements that he made during the time that he was the chair of the Trump campaign. So that, I think, is highly significant. That the -- that Robert Mueller is alleging that Paul Manafort was committing crimes while he was the campaign chairman of the Trump campaign.

HARLOW: While.

TOOBIN: So that --

BERMAN: And, Jeffrey, again, it does not preclude the possibility that this 12-count indictment will not be used to try to get information about the Trump campaign.

[09:14:54] TOOBIN: Absolutely. And, you know, one thing, you know, people need to know about the way prosecutions work is that just because an indictment has been filed, doesn't mean that that's the only indictment that will be filed. There's something called a superseding indictment, where you can add charges against the same defendant.

So, we are not at the end of the process, by any means.

POPPY HARLOW, CNN ANCHOR: And most experts would say, really, at the beginning and the timing here, tomorrow, as Evan reported, the date runs out for some of these tax issues to be charged. That's tomorrow, the end of the month. So, they had to get some of this out. As you're saying, there could be another -- there could be more added to this.

TOOBIN: There could be -- there could be more added. But, believe me, this is, this is a bad day for Paul Manafort and Rick Gates. Even if this is all the charges that they face. I mean, these are 12 very serious felonies with very heavy penalties associated with them.

HARLOW: So, it turns out, we're hearing that Rick Gates, Paul Manafort, will be in court at 1:30 p.m. Eastern today. Let me just keep reading more of what John read. This is more of the indictment.

"In furtherance of the scheme, Manafort and Gates funneled millions of dollars in payments to foreign companies and bank accounts opened by them and their accomplices in nominee names in various foreign countries including Cyprus, Saint Vincent, The Grenadines, and Seychelles."

Remember, some members of the Intelligence Committee on the House side went to Cyprus more than once, including representative Quigley, looking for answers.

JOHN BERMAN, CNN ANCHOR: Susan Hennessey, I want to bring you in here. Talk to me about how this investigation works. What this tells you about what Robert Mueller and his team are doing, given the information that Evan Perez reported before, that there was a reason to try to get this done before the close of the month because of the statute of limitation on some of the tax issues here.

SUSAN HENNESSEY, CNN NATIONAL SECURITY AND LEGAL ANALYST: Right, so it's been difficult to sort of opine on Mueller's strategy. His team has played it really close to the chest. One thing that you might sort of speculate is that he's bringing these charges early in an attempt to mount some pressure on actors like Manafort and Gates in order to incentivize them to flip essentially.

To give them additional information that's going to allow him to bring further charges. That's sort of one possibility. The other possibility is that, you know, they were up against a clock and they needed to file these charges. They thought that they had a case that they could prove beyond a reasonable doubt in court. And so, they thought this was the appropriate moment to indict. The other thing is that those aren't necessarily mutually exclusive, right? It could be that while they were up against a time clock here, they wanted to do the indictment, and by the way, that might pay off sort of significant dividends, regarding the broader sort of Russia investigation.

Certainly, Paul Manafort is a person who was right at the center of all of this, right? We know that me participated in some of the Trump Tower meetings. He is sort of the one common denominator in all of these various suspicious connections with Russia.

So, he's certainly an individual that has a tremendous amount of information in his head, that's going to be valuable to Mueller's team, and the question now is, how he decides to sort of respond to these charges.

Is he going to plead guilty in an attempt to have a cooperation deal? Is he going to play the long game and maybe see if President Trump is willing to pardon him? Sort of something in between? And so, what's going to be interesting here is less so sort of Mueller's strategy at this point, and more Manafort and his defense team.

BERMAN: And again, you brought up something that's interesting. Paul Manafort was in that meeting in Trump Tower with Donald Trump Jr. and the Russian lawyer who was there with the promise to Donald Trump Jr. that she was bringing information from the Russian government about Hillary Clinton.

It could be completely disconnected. We may never have a connection between these charges against Paul Manafort and that, but interesting that he was sitting at the table for that meeting.

HARLOW: Shimon, as you're going through this and so are we, right now. To Jeffrey's point of bringing up -- it does not mention the Trump campaign. However, it does mention statements that Paul Manafort made during the five months he was chairing the campaign. Do you know, specifically, what some of those are?

SHIMON PROKUPECZ, CNN CRIME AND JUSTICE PRODUCER: No, I don't know if they're contained in the indictment and I haven't seen them yet. The other thing I wanted to bring up, Poppy and John, and maybe this is a question for Jeffrey, there's a FARA violation here.

And you know, we've all been reporting on how rare it is for the U.S. government to bring charges against someone on FARA violations. Usually, it's something that they let you go back and kind of correct and you can file late or register late.

So, I'm wondering what's going to be made of that by some of the defense attorneys here and also just the scope of this. Why is it that the special counsel's team started investigating this?

You know, we know, as Evan Perez has been reporting and has reported, that Paul Manafort has previously been under investigation by the FBI for his dealings with Ukraine, Yanukovych, and the Ukraine deals that were ongoing there.

And for a time, at least we were told several months ago, the FBI and the Department of Justice did not think they had enough to bring charges in connection with that. So, what's changed? And why now did the special counsel team come in and decide, you know what? We do have enough to bring charges here? I mean, that's going to be an interesting question as well as we go forward.

[09:20:11] TOOBIN: Well, the issue just to answer your question about why -- FARA is a law regarding as to when and whether you have to register as an agent of a foreign government. Usually it is not charged criminally if you make a mistake on one of your forms.

The difference is what makes it criminal is the issue of intent. If you make a mistake, a good faith mistake, it's not criminal. But if the government can prove that you intentionally lie, it can be criminal.

If I can just make one more point about sort of big picture here, this is a very complicated indictment. This is never going to get to trial very quickly. I think this is six months, at least, from a trial, if there is a trial, at all.

That means the Mueller investigation is guaranteed to go into -- well into 2018 and anyone who hoped or worried that the Mueller investigation was going to closeup shop by the end of 2017, this guarantees that is far, far from the case.

BERMAN: This is the cloud that will last more than a year.

HARLOW: Yes. And Jeffrey, just to your point about intent, I mean, that's point three in this indictment. It says that Manafort and Gates concealed from the United States their work as agents, concealed. Not just made a mistake.

BERMAN: All right, guys. We obviously have a ton to discuss. We are poring through this major indictment right now and the breaking news this morning. Much more ahead.



HARLOW: All right. Back with our breaking news. You're watching video from just earlier this morning. Paul Manafort, the former campaign chair of the Trump campaign and his associate for decades, Rick Gates, walking into the FBI headquarters about to head, in a little bit, to the courthouse after being charged with 12 different counts.

Back with us, our panel. Jeffrey Toobin, to you as we read through this, point 38 on page 23 of this 31-page indictment is significant. Here's what it reads. "From in or about 2006 to 2017, Paul Manafort and Rick Gates, together with others, knowingly and intentionally conspired to defraud the United States by impeding, impairing, obstructing, and defeating the lawful government functions of a government agency, namely the Department of Justice, the Department of Treasury, and to commit offenses against the United States." That time period.

TOOBIN: Yes, just to translate that legalese into English, what it means is between 2006 and 2017, including the time when he was campaign chairman of the Trump campaign, he, Manafort, Gates, together with others --

BERMAN: Together with others.

TOOBIN: Together with others. I mean, that is a very pregnant question, about who are the "others," that they will allege, are the other unindicted co-conspirators in this case, conspired to defraud the United States. So, you know, you have the campaign chairman and a senior member of the campaign charged with defrauding the United States at precisely the time that he is the chairman of the campaign, the successful campaign, of Donald Trump.

HARLOW: Go ahead.

BERMAN: And again, the words here are "impeding, impairing, obstructing, and defeating the lawful government functions of government agencies, the Department of Justice and the Department of Treasury."

You know, and Susan Hennessey, Rick Gates didn't leave the campaign when Paul Manafort left in August of 2016. He stayed on through the fall. He then worked for the transition. He then worked for a PAC that lobbied on behalf or worked on behalf, I should say, of the administration before he was pushed out of that.

The president of the United States, Donald Trump, we know he talked to Paul Manafort through the beginning of this year while this indictment suggests they were working to defraud and obstruct justice. That has got to be a problem at a certain level for the administration.

HENNESSEY: Well, I think it certainly is. One thing to sort of keep in mind is the scope of Mueller's investigation, right? So, it's not just sort of Russian collusion or Russian interference and potential campaign collusion. Amidst anything that are rising out of that investigation.

So, it means that as Mueller is sort of going about conducting that investigation, anything else that he comes upon, including sort of prior financial crimes and including criminal activity, whenever an individual does something that violates the law of the United States, in trying to obstruct his investigation or lying to federal investigators.

So that is all sort of fair game within the sort of proper scope of the Mueller investigation. So, we might hear some things this morning about, you know, this is a witch hunt, this is proof of Mueller having exceeded his scope.

This is the kind of behavior and activity that is squarely within sort of that mandate that the deputy attorney general, Rod Rosenstein, had given to Mueller in the first instance.

HARLOW: All right. So, we also know that Rick Gates was at the White House several times this year, OK? And on top of that, we're just getting some reaction from our Jim Acosta's reporting, who of course is our senior White House reporter, of someone familiar with the situation.

A source close to the White House, let me read it to you, that source saying, quote, "Today has zero to do with the White House." Again, the White House is messaging before an official statement that today has zero to do with the White House.

The problem with that argument, Jeffrey Toobin, is the fact that, as John said, Manafort and the president kept talking, far beyond when he left, until their own lawyers said, you have to keep talking, by the way. And these dates, 2006 to 2017, that's beyond his work with Ukraine.

TOOBIN: Right. And, you know, it -- I do think it's important to point out, in fairness to what the White House is saying, is that the individual crimes charged, the making false statements to the Department of Justice, the making of false statements to the Treasury Department do not refer at all to the Trump campaign.