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U.N. Reports North Korea Still Making Nukes; Zimbabwe Election; Iran Military Drills in Persian Gulf; Manhattan Madam Interviewed by Mueller Team; Trump's Advisers Counsel against Mueller Interview. Aired 12m-12:30a ET

Aired August 4, 2018 - 00:00   ET




UNIDENTIFIED MALE (voice-over): This is CNN breaking news.

CYRIL VANIER, CNN ANCHOR (voice-over): Hello. I'm Cyril Vanier at the CNN Center and we're following breaking news this hour.

Disturbing information coming from a confidential United Nations report that says North Korea is still pursuing its nuclear and missile programs. The report was prepared by independent experts.

Now this is a complete violation of international sanctions and it comes after the U.S. restarted talks with North Korea on denuclearization. Two months ago, Donald Trump met with North Korean leader Kim Jong-un and proclaimed North Korea was, quote, "no longer a nuclear threat."

Let's bring in CNN's senior U.N. correspondent Richard Roth. He's in New York at the moment. He's seen highlights of this report.

Richard, what can you tell us?

RICHARD ROTH, CNN SENIOR U.N. CORRESPONDENT: Cyril, every six months, an independent group of so-called experts provide the report on North Korea and its compliance -- or lack of -- with U.N. Security Council sanctions on Pyongyang.

This latest report, as you mentioned, highlights of which I've seen, says North Korea is still working on nuclear and missile programs. Despite the peace overtures with the U.S. and other Asian regional powers, this U.N. panel of experts says, quote, "North Korea has not stopped its nuclear and missile programs in violations of U.N. sanctions."

The report went Friday night New York time to the Security Council Sanctions Committee and says the North Korean government is evading sanctions through illicit ship-to-ship transfers of petroleum products and by transfers of coal at sea during this year.

The report says North Korea has flouted -- that's the word they used -- the caps on its imported petroleum and crude oil as well as the coal ban that went into effect last year.

The U.S. recently provided intelligence about illegal ship-to-ship transfers to the Sanctions Committee along with photographs.

So when they mentioned in the report that one country has mentioned that North Korea has gone over 500,000 barrels -- 500,000 barrels of refined petroleum products in just the first five months of this year, it's likely it could be from the U.S.

And the report says other member states will now have to immediately halt all transfers. So you see the pattern and the trend according to this report -- Cyril.

VANIER: The report also says that North Korea is selling weapons to other countries?

ROTH: Yes. Now in the report of which, again, I've seen only highlights, so until we see the full report and maybe get the entire context, one must always be cautious.

But quoting directly from the report, it says North Korea attempted to supply small arms and light weapons and other military equipment via foreign intermediaries, including Syrian arms trafficker Hussein Ali. In the case of Houthi rebels in Yemen, as well as Libya and Sudan.

The panel continues investigations into designated people and entities in Asia, which, quote, "clandestinely procured centrifuges for the North Korean nuclear program and attempted to sell a wide range of military equipment to armed groups and governments in the Middle East and Africa."

VANIER: All right, Richard Roth, senior U.N. correspondent, now we're learning.

So we're learning these two things from this as of now, as of, until now, secret report, which is that North Korea is flouting U.N. sanctions, is continuing its nuclear and ballistic missile program and is also using intermediaries to try and sell weapons to other foreign countries.

As we get this news, U.S. secretary of state Mike Pompeo is at the ASEAN summit in Singapore, that's the Association of Southeast Asian Nations. Our Ivan Watson is there now.

Ivan, is there any indication that Pompeo knew about this report, number one?

And what is the North Korean presence at this summit, number two?

IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, no, he didn't make any reference to this U.N. report in particular. But it was striking. He brought a much tougher line on North Korea to this summit here in Singapore less than two months after that historic face-to-face meeting and warm handshakes between President Trump and Kim Jong-un in this very same city. And Mike Pompeo didn't echo any of the triumphalism of President

Trump, talking about achieving kind of peace and, hey, you can sleep well tonight because we've averted conflict.

Instead, his message to Southeast Asian nations is to continue to maintain the economic and diplomatic isolation of North Korea, to completely stop, as he put it, illegal ship-to-ship transfers of petroleum destined for North Korea.


WATSON: He said that North Korea, its behavior, was inconsistent with the commitment that he said Kim Jong-un made to denuclearization -- and this is important. He singled out Russia, claiming that it is helping North Korea evade sanctions. Take a listen to what he said.


MIKE POMPEO, UNITED STATES SECRETARY OF STATE: We have seen reports that Russia is aligned for joint ventures with North Korean firms and granting new work permits to North Korean guest workers. If these reports prove accurate, then we have every reason to believe they are, that would be in violation of U.N. Security Council resolution 2375.

I want to remind every nation that has supported these resolutions, that this is a serious issue and something we will discuss with Moscow.


WATSON: Now, Cyril, you asked about the North Korean presence here. North Korea is kind of an affiliate to, invited to attend this summit; its foreign minister has attended. Mike Pompeo was asked at this press conference around three hours ago whether or not he had met with his North Korean counterpart.

And he said, at that point, no, there had been no talks taking place between the American and North Korean delegations. The day is still young here. It is possible that there could be a meeting, though U.S. officials thus far have told journalists that there was no such meeting planned here.

VANIER: Yes, it's hard to imagine that the U.S. secretary of state isn't going to be made, at some point or other or during the course of the day, to address this breaking news. Ivan Watson, we'll follow up with you on this later. Thanks very much.

As day breaks in Zimbabwe, a country no stranger to political turmoil, uncertainty looms over this week's presidential election. The opposition party insists it will not accept the results. Its leader, Nelson Chamisa, calls the vote "fraudulent and illegitimate."


NELSON CHAMISA, ZIMBABWEAN OPPOSITION PARTY LEADER: We are not accepting (INAUDIBLE). We are not accepting this (INAUDIBLE). We want the (INAUDIBLE).

We will pursue all means necessary, legal and constitutional, to make sure that we protect the people's vote. The people have voted. They are cheated. The people have won. They are subverting that win. We will not allow it and we will not accept.


VANIER: Despite that, President Emmerson Mnangagwa says the election was peaceful and was transparent.


EMMERSON MNANGAGWA, ZIMBABWEAN PRESIDENT: With regard to accepting or not accepting the results, Zimbabwe is enjoying democracy. Any member of the public or any political party can proceed in terms of a (INAUDIBLE) and the (INAUDIBLE), challenge the results in the (INAUDIBLE).


VANIER: For Zimbabwe, this vote is critical. A stable election would go far to attract foreign investment and revive the sinking economy but that hope may be put on hold. After preliminary election results were announced, six people were killed in clashes with security forces.

The political crisis comes as the country looks to recover from nearly four decades of authoritarian rule under Robert Mugabe. When Mugabe was forced out last year, many saw that as an opportunity for the country to remake itself. And that's why these elections were pivotal.

Zimbabwean journalist and writer, Peter Godwin, joins me now.

Peter, this election was about one thing: could the country really turn the page of the Mugabe era?

What say you?

PETER GODWIN, JOURNALIST AND WRITER: No. I think that, in a sense, that was a foregone conclusion insofar as Zanu-PF's, Mugabe's party, is still very much an institution in -- it follows his more still. And Emmerson Mnangagwa was Mugabe's assistant or consigliere, if you like, for the last 38 years.

So in that sense, if the country went Zanu-PF, there was no question that the page of history was not been turned.

VANIER: You're saying Zimbabwe can never turn the page of the Mugabe era under Mnangagwa?

GODWIN: Yes. In my opinion that the DNA of Zanu-PF runs very, very deep. This is a political party that was a liberation army before it became a government. And it, like many of the liberation governments, liberation parties in Southern Africa that fought wars for independence, none of them have lost power.

VANIER: But Mnangagwa is saying the things and trying to send out all the -- trying to burnish his democratic credentials, if you will, and saying the right things. Let me read to you some of his latest tweets.

This was in the last few hours after the Zimbabwean police --


VANIER: -- initially tried to break up the press conference by the opposition leader, Mr. Chamisa.

So Mr. Mnangagwa wrote, "The scenes today at the Bronte Hotel have no place in our society and we are urgently investigating the matter to understand exactly what happened.

"Over the past nine months we've protected freedom of speech, of assembly, the right to criticize the government. This is an indispensible part of the new Zimbabwe. It is non-negotiable and will not change," and it goes on.

So Mnangagwa is clearly aware that he has to prove to Zimbabweans and also to the international community that he can be the conduit for democracy.

GODWIN: And fine words indeed they are. But bear in mind that when Mnangagwa himself was the head of the secret police, the minister in charge of internal security for many, many years and that his vice president, General Chiwenga, who was the person who perpetrated the coup against Mugabe, was until extremely recently the head of the army.

So in that sense, the protests about the overreaction of the police and the army to protests following the elections rings a little hollow. I mean, they are a little bit between a rock and a hard place.

They desperately need the approval of the international community to lift sanctions, to encourage new foreign investment, because Zimbabwe, economically, is in an absolutely terrible state. It is a failed state. It has soaring unemployment. The government really doesn't provide any services at all.

So they are desperately in need of these things.


VANIER: They need those loans by the International Monetary Fund. They need to attract international investors.

Now the opposition, Mr. Chamisa in particular, says we do not accept these election results and they are apparently drawing up a plan. They haven't explained what it is yet, as to what they are going to do the next few days. But they don't -- that's their message. They don't accept this. Where do you see this going?

GODWIN: There have been election irregularities -- and these things don't just start a day or two before the elections. They go back many, many months, before the elections begin; for example, in the electoral role itself, electoral regularities there and they don't get access to the state media.

There are many, many things that they are complaining about. What I think happens now is quite interesting, which is that, to some extent, Emmerson Mnangagwa needs Nelson Chamisa and the MDC to sign off on these elections, which, as you quite rightly say, they are not prepared to do at the moment.

So I think there's a sort of game of chicken going on. And my speculation would be that ultimately where this has to go is toward a government of national unity, that basically Mnangagwa needs the opposition to come on board and then say to the international community, OK, we will do this together.

VANIER: Yes, Mnangagwa has extended an olive branch to Chamisa. You wonder whether perhaps there might be some deal in the making down the road. But it isn't there yet. Peter, thanks so much for joining us today, Peter Godwin, thank you.

Usually Iran tells the world its military exercises are about to begin but not this time. When we return, why a show of force has been kept under wraps. Stay with us.





VANIER: Now to the Persian Gulf, where the U.S. is keeping a close eye on Iran's military exercises. There's concern that Tehran might be using a show of force to demonstrate that it can shut down the Strait of Hormuz, a strategic passage for global oil supplies. Our Nic Robertson has the details on this.


NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR (voice-over): At anchor, tankers, waiting to help slake the world's unquenchable thirst for oil. Between them and their vital cargo, the Strait of Hormuz, a strategic choke point in the path of 20 percent of global oil supplies and a massive military exercise by Iranian forces.

ROBERTSON: U.S. Defense officials say that dozens of small Iranian vessels are involved in these military drills that normally happen much later in the year. The timing now so close to the reimposition of U.S. sanctions on Iran and Iranian threats to close the strait is raising concerns.

ROBERTSON (voice-over): Typically in the past, Iran publicizes its naval training exercises. This was similar maneuvers last year. Not so this time.

UNIDENTIFIED MALE: Given the ongoing saga of the geopolitical (INAUDIBLE) Arabian Gulf, UAE, like many other countries, has taken a set of measures to ensure the (INAUDIBLE) supply of this oil exports.

ROBERTSON (voice-over): Iran's threats aren't new. During the 1980s, the so-called Tanker War saw U.S. Naval ships escorting oil tankers through the Strait of Hormuz. Since then, regional oil producers here, like the UAE, have been making contingency plans.

The port of Fujairah on the Gulf of Oman is at the end of a massive pipeline begun a decade ago to bypass the Strait of Hormuz.

UNIDENTIFIED MALE: Fujairah, historically, has been always considered as a kind of a natural hedge again any geopolitical risk that take place at the Arabian Gulf.

ROBERTSON: So it's a backup.


UNIDENTIFIED MALE: Yes, it is a backup.

ROBERTSON (voice-over): In recent weeks, a war of words has been escalating between Washington and Tehran, Iran's president warning a war with Iran would be the mother of all wars. President Trump firing back an all-caps tweet, demanding an end to threats or else face serious consequences, then changing to this tactic.

TRUMP: Thank you very much.

I believe in meetings, I would certainly meet with Iran if they wanted to meet. I don't know that they are ready yet. They're having a hard time right now. No preconditions, no. They want to meet, I'll meet, anytime they want.

ROBERTSON (voice-over): The Iranians not taking up the offer.

ROBERTSON: No one here knows how long the current tensions in the Strait of Hormuz are going to last and that what makes this oil pier here so valuable to the port. They are developing it so another 11 large oil tankers can dock here. They are future-proofing their security -- Nic Robertson, CNN, the port of Fujairah, near the Strait of Hormuz.


VANIER: Coming up after the break, the Russian investigation takes a strange turn.

Why would the special counsel be interested in talking to a woman who once ran a prostitution ring in Manhattan? (MUSIC PLAYING)




VANIER: A web of intrigue surrounds the woman known as the Manhattan madam and why she agreed to an interview this week with special counsel Robert Mueller's team.

Kristin Davis once ran a high-priced prostitution ring and went to jail for it. Now on the surface, she doesn't appear to have a connection to the Russia investigation. CNN's Sara Murray tells us more.


SARA MURRAY, CNN CORRESPONDENT (voice-over): Kristin Davis, the woman known as the Manhattan Madam, meeting with special counsel Robert Mueller's team for a voluntary interview earlier this week, sources tell CNN.

Investigators apparently interested in her ties to longtime adviser Roger Stone. She and Stone have been close friends for a decade. Investigators also expressed interest in having Davis testify before a grand jury, the latest indication prosecutors are aiming to build a case against Stone.

Davis' lawyer declined to comment.

In a statement, Stone tells CNN: "Kristin Davis is a longtime friend and associate of mine. I am the godfather to her 2-year-old son. She knows nothing about Russian collusion, WikiLeaks collaboration or any other impropriety related to the 2016 election, which I thought was the subject of this probe.

"I understand she appeared voluntarily. I am highly confident she will testify truthfully, if called upon to do so."

Davis once ran a high-end prostitution ring and went to jail as part of the scandal surrounding then Democratic New York Governor Eliot Spitzer.

ELIOT SPITZER (D), FORMER NEW YORK GOVERNOR: The remorse I feel will always be with me.

MURRAY: She has worked with Stone over the years and, in late 2016, she joined his payroll to help him with clerical tasks. Mueller's team has been looking into possible contact between Stone and WikiLeaks founder Julian Assange during the 2016 campaign.

ROGER STONE, FORMER TRUMP CAMPAIGN ADVISER: Yes, I followed Assange's Twitter very assiduously. I had a Google alert for him. I read every interview he gave. You could foreshadow what he's doing. I'm not involved in any collusion, coordination or conspiracy with the Russians or anyone else and there's no evidence to the contrary.

MURRAY: Investigators have also been probing Stone's finances and his personal life. People familiar with the situation say at least two witnesses were asked whether Stone was actually the father of Davis' son.

Earlier this week, Stone posted a photo of Davis and her child to Instagram with this caption, "Why do FBI agents dispatched by Robert Mueller keep asking a number of my current and former associates if I am this baby's father?

"What does this have to do with Russian collusion and the 2016 election?"

This week another associate of Roger Stone, Andrew Miller, was also ordered to testify before the Mueller grand jury. Yet another indication of how the special counsel's team seems to be circling around Roger Stone -- Sara Murray, CNN, Washington.


VANIER: Still unknown is whether President Trump will consent to an interview with the man investigating him, Robert Mueller.

Negotiations over a possible face-to-face are ongoing even though Mr. Trump routinely dismisses the probe as a hoax and a witch hunt, he says he actually wants to sit down with the special counsel. His lawyers say it's a bad idea and so does former campaign manager, Corey Lewandowski.


COREY LEWANDOWSKI, FORMER TRUMP CAMPAIGN MANAGER: I'm not an attorney but my political advice to the president would be not to sit down with Bob Mueller. The opportunity to make a misstatement potentially or to potentially get caught up in the word "is" is too great.

RUDY GIULIANI, TRUMP ATTORNEY: He's always been interested in testifying; it's us, meaning the team of lawyers, including me, that have the most reservations about that. I'm not going to give you a lot of hope it's going to happen. But we're still negotiating. We haven't stopped negotiating with them.


VANIER: Political analyst Michael Genovese joins us now from Los Angeles.

Michael, great to have you back on the show.


VANIER: There are two theories out there about Mr. Trump and his willingness to talk to Robert Mueller. One is that Trump believes he can convince Mueller he's done nothing wrong and that's why he wants to sit down with him. The other is just he's pretending to want to sit down.

What do you think?

GENOVESE: It wouldn't surprise me if the president feels that he can talk his way out of anything. He is a very good salesman. He prides himself on that. He says he's the best negotiator and so you can see him actually believing that, if he got into the room, he could convince people that he's innocent, that there's no collusion and that there's no conspiracy.

That being said, his lawyers know that that would be a disaster waiting to happen, not because Donald Trump is not well versed nor is it because he would fumble his way through it.

It's simply because there's so many traps he could fall into. So wisdom in this case is not to have him testify. But the president's ego is pretty powerful and it drives him and he thinks he can win in a confrontation with Mueller.

VANIER: Tell me about --


VANIER: -- this trap idea, because this is one -- this is an argument made by the president's supporters as well as lawyers. You heard Corey Lewandowski saying that the interview is a perjury trap.

In other words, the president could be caught lying and could get into legal trouble even if he's done nothing wrong, just on a technicality.

Does that make sense to you?

GENOVESE: Well, I -- not the technicality argument but the perjury argument does. I think all lawyers today who look at situations like this, look at the Bill Clinton affair and they say, you know, he was bushwhacked, ambushed and surprised.

And out of that, he made a couple of fumbling statements that came back to haunt him.

And the question is, what does Mueller have, what does he know?

Could he flummox the president on the stand?

And there's such a strong possibility that Mueller has so much information that he just might upend the president and so it's not worth the risk.

VANIER: Meanwhile, Trump, of course, is still calling the whole Russia thing and Russia investigation and accusation of collusion a big hoax. Well, if it's a big hoax, it shouldn't be too hard for him to sit down with Mueller and separate fact from fiction.

GENOVESE: Well, the hoax argument that the president continues to use while his administration, virtually everyone else, is on a different page. So you've got in Trump world, there's one story but in the real world there's another and they are worlds apart.

You've got the administration saying this is a serious problem. We're going to tackle it, we're going to handle it and the president undermining that message by saying it's a hoax. The Russians didn't really do it. There's nothing here. There's no there there.

So if the president is not on board with his administration on dealing with Russia in the upcoming election, he's going to undermine everything. And so, you know, we're really on very thin ice on this. The president believes and needs to believe it's a hoax. Virtually everyone in his administration is arguing otherwise.

VANIER: All right. Michael Genovese, always a pleasure speaking to you, thank you.

GENOVESE: Thank you, Cyril.

VANIER: And thank you for watching CNN NEWSROOM. The headlines are next. Stay with us for those.