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Republican Grimm Indicted; Storms, Tornadoes Kill 16, More on Way; NBA Owner under Fire

Aired April 28, 2014 - 12:30   ET


DANA BASH, CNN CHIEF CONGRESSIONAL CORRESPONDENT: When it comes to any kind of hot water that a congressman is in, this really is up there. I mean, this looks pretty bad for him.

ASHLEIGH BANFIELD, CNN ANCHOR: Yeah, I'd say a 20-count indictment --


BASH: Exactly. And I was just going to say -- exactly.

But having said that, the last time we heard from his lawyer about his political future was on Friday, saying that he intends to keep his seat. We have not heard from the House Republican leadership. It's crickets, Ashleigh, nothing. And guess where he serves. On the financial services committee.


BASH: Yes, he does.

BANFIELD: Well, wasn't the House ethics committee putting off its investigation until this federal probe ended, so that probably is all going to fire up again?

BASH: It certainly could be. The ethics committee is very secretive, but at this point, the ethics committee is the least of Michael Grimm's worries.

BANFIELD: Yeah. I hear you about that. Exactly. Dana, thank you. Stand by for a minute, because I want to get Danny Cevallos in on this, as well.

I listened to the U.S. attorney's live news conference. She was pulling no punches. She said things like he hired undocumented workers, he lied about payroll, lied to the taxing authorities. It was breathtaking in his simplicity, his scheme, she said. He made over a million dollars disappear. And that's courtesy of Loretta Lynch, the U.S. attorney.

Let me ask you this one question. When you're dealing with somebody this high profile and you're dealing with a congressman, do you make your case airtight before you say things like that in public? DANNY CEVALLOS, CNN LEGAL ANALYST: Oh, of course, but, let this be a cautionary tale, because I think this was probably a relatively easy case for the prosecution to make out.

I mean, this is a classic case of taking money when you're a business owner and just putting it in your pocket instead of reporting it. The second element is that it's alleged that he wasn't paying proper payroll. In other words, he was paying workers directly and avoiding taxes he would have had to pay.

I think a lot of small businesses do it, but understand that when you do, you violate a number of federal and state laws. And that's exactly what he did here. And there's even allegations that he may have kept a true ledger. Two ledgers, one was the fake payroll that he paid and the true payroll that he paid.

BANFIELD: You mean cooking books?

CEVALLOS: Well, I mean, keeping that simultaneous two sets of records, it could be devastating if those records are out there.

Remember, also, the actual indictment itself references a number of e- mails sent. Increasingly, we live in a world where either time you send an e-mail, it's not only going through interstate commerce, it's preserved forever.

BANFIELD: And don't forget. We've got the two counts of perjury, one count of obstructing an official proceeding. Those aren't never good either, especially when you're talking about the feds. And like Dana said, don't mess with the IRS. Watch "Breaking Bad." You should know better than that. All right, all of these allegations, of course.

Dana Bash, Danny Cevallos, thank you for that.

By the way, 1:00 p.m. is when this man apparently plans to speak live.

Was just going to ask you one really quick question. Would you ever allow your client to go on the TV and talk live about things they've just been indicted for?

CEVALLOS: Oh, everything's a case-by-case basis, but probably not in this case. I would go with no.

BANFIELD: I'm with you on this one. And, look, I'm making light of it only because he threatened one of my colleagues. and he threatened another one, ostensibly, during an interview with Piers Morgan.

He was extremely sort of vicious in his tone, and he walked out on an interview, so I just find him morally to be questionable, but that's me.

Thank you, Danny. Thank you, Dana.

Back to the big story of the day that we've been following, the devastating storms impacting millions of people today, from devastation to the next round of storms that are on the way, we're going to take you live to Arkansas, next.


BANFIELD: The images from this weekend's devastating tornadoes could be an example of what's still to come, millions of people in the path of dangerous, severe storms today. There's so much loss in such a short time. The death toll now stands at 16 in three states.

Just take a look at the images. They speak volumes, businesses and homes reduced to nothing, memories and family photographs all lost. That's the stuff that insurance can just never buy back. Thousands of people spending their days searching through the debris, one touching moment captured on video as a local reporter in Arkansas returned one woman's priceless treasure.


UNIDENTIFIED FEMALE: I don't know if this belongs to you, but I found this right near the tree.

UNIDENTIFIED FEMALE: It's my daughter.

UNIDENTIFIED FEMALE: You're so welcome. I'm so glad I was able to find a picture for you. Actually, my photographer found that.

UNIDENTIFIED FEMALE: Thank you so much.


BANFIELD: One bright thought in Mayflower among so much heartache.

And I want to take you to Vilonia in Arkansas, where George Howell is standing by live. Tell me about the picture where you are, George.

GEORGE HOWELL, CNN CORRESPONDENT: Ashleigh, when you look around here, we're inside the Mirage Flash Market just off main street in Vilonia.

If you can see here, it is a mess. There's glass everywhere. A lot of things got knocked around last night. And, you know, the damage here, who knows how much they lost in property damage when the storm came through?

Maggie, an employee here, I want you to tell us, first of all, how all this happened. Obviously just wind coming through?

MAGGIE CARO, STORE EMPLOYEE: The whole tornado, I guess it's the speed of the wind that came through. And that's what happened. This is from the tornado. It's bad.

HOWELL: You rode it out in a shelter?

CARO: Yeah. We ran to a shelter. We weren't going to stay here. We ran to a shelter.

HOWELL: As many people did. You know, that's what people did. They heard the sirens. They went to shelters. But, again, we know that at least 10 people died here in Faulkner County. And when you look around here, you can see exactly what people had to deal with.

Jordan, if you could pan around and show, this is the gas station outside. Look at this, powerful enough winds, powerful enough to knock all of these over. If we could pan over here as well, look at these power lines, just snapped them right in half, knocked them right over.

There are power lines all around this area that are knocked down. There are homes that are destroyed. If you see the row of homes over there, guys, so these homes -- these guys really dodged the tornado, dodged the bullet in a sense.

But just down the road, you start seeing the trees. The branches have been taken off the trees. Down the road, that's where a lot of homes are destroyed. Down the road, officials are keeping us back, so that they can do the work they're doing.

Again, at least 10 people we know died in Faulkner County. We know, overall, in the state of Arkansas, 14 people died, but a total of 16 people in two different states, in Iowa and Oklahoma. That adds to the list. And the search continues, but, again, Ashleigh, they were searching through the night, described it as a very deliberate search, looking for survivors, just trying to get through all of this.

BANFIELD: And, George, it's still so early, but I asked Chad Myers in an earlier report that he did live on the program about the missing.

Are you hearing anything? I know you're being kept back, but usually that's because there's something, you know, that could be pretty difficult to see.

Do they know at this point if there are any missing in that community?

HOWELL: And I think the way you got into it makes sense, because they're not telling us that exactly.

But it is fair to believe that's a very deliberate search, s they're keeping, you know, gawkers away. When storms like this happen, people want to go to the areas to see it themselves. They're keeping people away. They're holding us back for the moment.

We understand that they are still looking for people. They're going through homes, doing what they can to find any survivors, and, of course, to find people who may be missing or dead in the storm.

UNIDENTIFIED FEMALE: All right, George Howell, live for us in Vilonia, thank you for that.

The other top story we're following, outrage directed at L.A. Clippers owner Donald Sterling after he's accused of making racist comments, and now everyone's asking, what can the NBA do?

And guess what else people are asking? Who is going to continue to sponsor this team? We've got news for you on someone who's just dropped them like a rock.


BANFIELD: Racist, raunchy comments purported to be those of Donald Sterling, the owner of the L.A. Clippers basketball team, sending absolute shockwaves through the NBA and, let's face it, pretty much well beyond. And this just in. One of the sponsors of the Clippers is dumping the team.

It's CarMax. And CarMax issued this statement just within the last while and it reads, let me read it for you, "CarMax finds the statements attributed to the Clippers own completely unacceptable. These views directly conflict with CarMax's culture of respect for all individuals. While we have been a proud Clippers' sponsor for nine years and support the team, the fans and community, these statements necessitate that CarMax end its sponsorship." End of statement.

All of this started after TMZ released a recording on which you can hear comments about black people. Also, the berating of Magic Johnson. It allegedly has Sterling complaining that his girlfriend should not have posted this photograph of her, along with Magic Johnson, on her Instagram account.


V. STIVIANO (voice-over): He happens to be black and I'm sorry.

DONALD STERLING (voice-over): I think it's nice that you admire him. I know him well and he should be admired. And I'm just saying that it's too bad you can't admire him privately. And during your entire (EXPLETIVE DELETED) life, your whole life admire him, bring him here, feed him, (EXPLETIVE DELETED) him, I don't care. You can do anything. But don't put him on Instagram for the world to have to see so they have to call me. And don't bring him to my games, OK?


BANFIELD: So, Magic Johnson and other NBA standouts are now calling for Sterling to leave the NBA. Whether he leaves or whether he is forced to leave the NBA. And I can tell you this, the NBA has just come out with another statement and it's effectively a statement about logistics. The NBA plans to hold a news conference tomorrow to make an announcement about its investigation involving Clippers owner Donald Sterling. They say additional details will be announced.

Glad to bring in Sunny Hostin, our CNN legal analyst, to comment on this. And alongside Sunny is sports agent Leigh Steinberg, the real- life Jerry Maguire. A guy who knows a thing or two about the business and also the legends in sports.

So, Leigh, I want to begin with you. Legally speaking, you think about the documents that actually outline the protocols for the NBA. Is this an easy case? Is this something that the NBA can do like that or is it more complicated?

LEIGH STEINBERG, SPORTS AGENT: I think that it's important to understand that when an owner buys a franchise in professional sports, they're not buying a corner drugstore. They buy it subject to a whole set of leagues rules, policies, regulations. And if they violate those, they can be suspended. But moreover, they can force a sale. They can't do a taking. They can't just take his property, but they can tell him he's no longer eligible to be an owner. And the other owners have the power to vote for that. The commissioner has the power. I know that's true in the NFL. I know it's true in Major League Baseball.

So I believe they'll move quickly. What's going to happen at the end of this is he won't own the franchise. They'll force a sale. And by tomorrow I'm sure they will have suspended him. Now, the irony is, this is a man who has given a large amount of money to inner city charities. The "L.A. Times" has those ads almost every month. They're sort of self-congratulatory.

But this is not 1860. We don't allow attitudes like in public figures. And, remember what a team is. It's a private business, but they claim to be your Los Angeles Clippers. So when you buy some franchise like that, you have to accept norms of behavior. And when someone fails those, clearly has happened here, they will move quickly.


STEINBERG: The problem is, if they don't move quickly, they'll lose sponsors, they'll lose television, they'll lose fans, they'll lose players. Its - there's not a single --

BANFIELD: And if anyone - if anyone is tuning in, Leigh, you're right, I mean CarMax just dumped them. I just mentioned that moments ago.

Sunny Hostin, I want you to jump in on this as well. Leigh talks about the rules and regulations. You don't get the privilege of running and owning a team without some rules that go along with it, but how nebulous are the rules?

SUNNY HOSTIN, CNN LEGAL ANALYST: Yes, I mean, I think they're very nebulous. I spent the morning trying to research this, calling my contacts at the NBA Players Union, calling my contacts all over and everyone agreed, listen, this contract between the owner and the NBA is private. We don't really know what it entailed. And so I suspect it's going to be difficult actually to, you know, force him to sell this team.

I agree with Leigh that I think we will be - we will see him suspended. Remember, he's 80 years old. In 68 years, the league has only suspended one owner. That would be the Minnesota Vikings Glen Taylor. He was only suspected for a short time. But if you take this seriously enough, Ashleigh, and you suspend him for 20 years, that is akin to a life sentence, right? So he needs to be suspended for a long period of time. I know that they can at least do that. And that means suspended from day to day team management. That means he has nothing to do with the team.

Remember, he is an employer, right, and so there are certain rules, federal lease (ph), in our states that prevent him from discriminating. And I think this probe needs to be wide ranging. I think you start looking at what he has done to discriminate in his hiring, in his firing. I think you look at Elgin Baylor's issue and reexamine --

BANFIELD: Jury sided with Sterling on that.

HOSTIN: That's right, but I think that you reengage, I think you reinvestigate. And I have to tell you --

BANFIELD: And (INAUDIBLE). All the other things he's faced have all been quietly settled without (INAUDIBLE).

HOSTIN: That's right. That's right. He who has the best lawyer wins, right?

BANFIELD: So - well, and he's got a lot of money too, I'll tell you that.

HOSTIN: That's right.

BANFIELD: Leigh, I want you to just weigh in on the pressure that other team owners could exert on the NBA. Does it behoove all of them to come forward and start getting on the TV and saying, it's unacceptable to the rest of us. This is not a club to which we want to belong and we certainly don't have members like him and if he's going to be like this, we want him out. This is what we're saying publicly, now get to it. Or does that matter at all? This is all NBA. Doesn't matter what the other owners say?

STEINBERG: It does matter what they say. But I don't think you'll see a whole lot of that. Among other things, this was a private tape recording of private sentiments. I don't think they're anxious to have the same standard, other owners, applied to them in anything they might do.

But, again, this is all going to get settled very quickly. The commissioner does have the power I am sure to force a sale. They didn't have to give the team to him in the first place. He had to go through a whole set of scrutinization, which obviously missed some key points, and he had to be voted on by the other owners. So they've got the power. There's not a single person, organization in this country that I've seeing, other than probably the Ku Klux Klan, that doesn't agree this is absolutely unacceptable. So it will - it will move quickly.

BANFIELD: Unacceptable, yes. I mean there's been plenty of - plenty of opposition (ph) to this. But, you know, there's a point - well, let me tell you, just as we've been talking, Sunny and Leigh, I've got another announcement and it comes from State Farm. Apparently they're not there because they are dropping the Clippers and their sponsorship as well. So that's happened just in the last -

HOSTIN: They should.

BANFIELD: You know, couple of hours. We now have CarMax dropping and State Farm dropping. HOSTIN: But -

BANFIELD: Real quickly, last comment, Sunny. Real quickly.

HOSTIN: You know, bottom line is, every -

STEINBERG: These -- they'll be back very quickly.

HOSTIN: You know, I just want to say, we need to widen the conversation. Yes, this man will be dealt with. I don't know that he's going to have to sell the team. But even around -- as a woman of color, around my kitchen table, these discussions about this implicit racism that it's in the system, we've really got to talk about it.

Just last week we heard the Supreme Court gut affirmative action basically saying that this type of racism doesn't exist. Guess what, it exists on so many levels. We've been talking about Cliven Bundy, we've been talking about the Supreme Court and affirmative action and gutting it. We need to address these issues. Racism is so alive and well.

BANFIELD: Now you say the -

HOSTIN: And people like me of color, raising children of color, we are sick and tired of it, Ashleigh.

BANFIELD: You say - by the way, you say woman of color, I say woman. Look at that picture.


BANFIELD: That's a married man with a woman 30 years his junior, you know, who's now embroiled in the --

HOSTIN: We're sick of it. We're sick of it.

BANFIELD: Leigh Steinberg, final word, just quickly. I'm flat out of time, but I know you wanted to make a comment. Last moment.

STEINBERG: Simply that, let's just wait a moment and allow the NBA to have some time to react here. This happened on Saturday. It's Monday morning here in California. They will move quickly. These sponsors will come back. This is otherwise a happy time for the Clippers and the playoffs. This will all be dealt with quickly.

BANFIELD: I hope so. You know, I hope so, Leigh, because it may only be 24, 48 hours, et cetera, but I got documents back to 2003 where this guy has said things that are unacceptable. And surely not befitting of a lifetime achievement award. Hey -

HOSTIN: And look at Marge Schott. Look at Marge Schott.


HOSTIN: It took a long time to get rid of her.

BANFIELD: Thank you to both of you, Leigh Steinberg, Sunny Hostin.


BANFIELD: Thank you to our viewers as well for watching. And I am flat out of time so I'm going to turn it over to Wolf Blitzer who starts right after this break. Have a great day.