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Citibank To Pay $7 Billion Over Bad Mortgages; Female Yahoo Exec Sued For Sex Harassment; J. Crew Now Sells Size 000, But Why?; Disturbing Trend Of Children Left In Hot Cars
Aired July 14, 2014 - 15:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
DON LEMON, CNN ANCHOR: Bottom of the hour, I'm Don Lemon. Do you ever notice bad apples get packed at the bottom of bushel? Well, in the six years now since the economy tanked, we have learned how America's most imminent banks have the scruples of a crooked produce seller. Now Citibank has agreed to pay a 10-figure penalty for packaging bad investments like produce hiding the rotten among the healthy and putting them up for sale to the unsuspecting.
So Erin Burnett joins me now to tell us about more. So Citi wasn't alone. You know, a lot of banks were doing it. People lost their careers. The economy tanked, a lot went wrong. People lost their dreams. Citi wasn't the only one doing it. Now they're getting a penalty, no jail time. What gives?
ERIN BURNETT, CNN HOST, "OUTFRONT": You know what's amazing, no one has gone to jail during the financial crisis and I knew you were thinking about this. Angelo Mozilo, he ran Countrywide Financial. The guy who created the subprime mortgage that now has become a four letter word. Angelo Mozilo, one could argue was at the heart and center of this.
He knew what he was doing all the way through. He paid I believe $67 million in fines, no jail time. So no, no one has gone to jail in all of this, but Citigroup will pay $7 billion. They get to write it off so only a hit to their earnings, Don. But they will be paying that to --
LEMON: Must be nice.
BURNETT: Yes, to low-income housing, reduced interest rates on mortgages and in some cases, to reduce principal that people will pay on mortgages.
LEMON: OK. But remember when all these guys were bailed out? They were supposed to pay us back, right? Weren't we supposed to see something from it, have we?
BURNETT: Now, this is a really interesting question. The bottom line answer to this is, yes, we have. When you look at the banks in America, the TARP, the real four-letter word when the taxpayers had to bail these guys out because of all the bad decisions that they made, horrible loans that they made -- by the way, in the case of Citigroup, they fully admit they knew what they were doing.
Not the case you get a lot of times where we don't admit to wrongdoing. They admit in this that they did a lot of things wrong. But the bottom line is, we made $30 billion off the banks, we the taxpayers. About a 12 percent return in terms of money bailed out. General Motors is the only company that did not yet pay back the U.S. government, and we the taxpayer have lost about 21 percent or about 1 --
LEMON: General Motors didn't pay it back?
BURNETT: They -- well, they have still a lot of things they have to work through in terms of how they're running their company, making good cars, making progress towards that. But obviously we're still lost a lot of money. They still put this update -- daily update from the U.S. government on how much money they have under TARP. Every day they still put this out as a reminder of how bad that crisis was.
LEMON: I can't believe they still haven't paid it back. Any hear anything you said -- I can't believe they have not paid it back. Isn't there like a time line they must pay back that money?
BURNETT: No, really they'll never have to pay it back. I mean, you know, what are the taxpayers going to rise up and do something about this? In terms of the Citigroup situation, I did talk to someone at Center for Responsible Lending. Are we really going to -- they say they're going to pay this money. Who is going to actually see it?
There is someone who is supposedly going to monitor this. There is not a lot of transparency. Who is really going to get the help? Who is really going to get a cut in their interest rates? There's some issues there.
LEMON: You said taxpayers are not going to rise up. Imagine if someone decided not to pay their taxes, though. That would be a completely different story. I don't want to pay what I owe the government.
BURNETT: Yes. They take it and hand it out to guys like Citibank and General Motors.
LEMON: Double standard? I don't know. We'll see. Thank you.
BURNETT: All right, good to see you, Don.
LEMON: We'll be watching tonight, of course, 7:00 Eastern, Erin Burnett "OUTFRONT" right here on CNN. It's a great program. She allows me to fill in for her sometimes and I try to keep the ship in the right direction.
Pant sizes, you have heard of 0 and 00, but a company is now selling a 000. Is that like negative pants? Are they really smaller jeans or is this a marketing stunt? Model Emme and Peter Shankman join me next.
And this is a new cover of "Vanity Fair's" latest edition with more than a dozen stars. What brought all of these '80s action stars together? It's a generation, my generation, next.
LEMON: Sex crime cases in Silicon Valley have been making headlines. First, a Google exec is found dead after being with an alleged prostitute and now a former female software engineer at Yahoo! is suing her boss, a woman, for sexual harassment. CNN Money tech correspondent, Laurie Segall, got a hold of the complaint and the allegations are shocking.
LAURIE SEGALL, CNN MONEY TECH CORRESPONDENT: They are pretty shocking. I mean, they basically say that this woman, she is -- was a junior -- she was forced to have sex by a senior executive and this is when they were both part of a startup that actually sold to Yahoo! and this is when they were living in temporary housing.
I got on the phone with her lawyer and spoke about it, and it said that Maria is a senior executive and insisted on staying at her place at temporary housing and forced her to have sex, even when she said she didn't want to, wasn't comfortable with it. She said this could affect your career.
And I should say that -- in this complaint, she went to Yahoo! She said that there has been sexual harassment. She asked for a transfer and her job was later eliminated. Now I should also say I reached out to Yahoo! Yahoo! issued a pretty strong statement, I want to read it to you.
They say there is absolutely no basis or truth to the allegations against Maria. She is an exemplary Yahoo! executive. We intend to fight vigorously to clear her name and they will have to fight because if you look at the complaint, the details are pretty explicit -- Don.
LEMON: It is. It's interesting, because -- sometimes if someone makes an allegation like this against you, whether it's true or not, the damage has already been done. It's going to be hard for Yahoo! and the executive to fight. And this is indeed true, if it did happen to the young lady, that's awful as well. But when someone levies an allegation like that against you, sometimes the damage is done in the allegation.
SEGALL: Absolutely. And when you look at this in context, now this isn't the first sexual harassment case I've covered in Silicon Valley. It seems like they just keep popping up and you know, part of this is a male-dominated culture, but this is a case of a woman complaining about another woman. And I asked her attorney about that and what she said, when there is money, power, this is going to be happening and keep popping up. That's how it is and the valley has a sense of perception. And he said that Yahoo! adamantly denies it. So we're going to see. We'll be pushing the story forward and be looking at it over the next couple days.
LEMON: Thank you, Laurie. Appreciate that.
Hollywood tough guys, Arnold Schwarzenegger, Harrison Ford, have been thrilling us for decades. "Vanity Fair" brought them together for the latest edition but why? That's next.
LEMON: You know how it is. You know when you're in a dressing room and the smallest jeans in the store are just not small enough for you? We've all been there? I always wanted a 27 waist and they never have it. J. Crew to the rescue. They have just unveiled J. Crew I should say that clearly. Unveiled a new size, 000. And if you're wondering, that's for customers with a 23-inch waist.
The company claims it's for their smaller-framed Asian clientele. But others with a notorious reputation, vanity sizing. Emme is here, model and founder of emme.com and branding and social media consultant, Peter Shankman. Are you buying it?
EMME, MODEL AND AUTHOR: I think that they definitely need to have a different size for their customer in Asia. But I do believe that it adds pressure to women to be something that they're not.
LEMON: OK. Tell me what vanity sizing is and the danger in sizing label itself.
EMME: OK. There is a big danger out there that if -- all women are being told they should be size 0 -- let's just start with 0 and we have about 68 million women who are above a size 12. So majority of women cannot even -- if they dreamt, could ever fit into a size 0 anything. So when you push a woman to be something that they're not, you cause body image problems, eating disorders. It's a trigger.
LEMON: I want to be clear, though, because they're saying they're doing it strictly for a certain clientele. But your issue with that is you can't then go into the store or on the same site buy --
EMME: The 16s or 18s. They don't -- and if we have a predominance of women above a size 12 -- 68 million women are a size 12 and above in this country. And in this country if we want to be a consumer of J. Crew, we have to go online and purchase a 16.
LEMON: OK. So you said this is supply and demand, you believe?
PETER SHANKMAN, BRANDING AND SOCIAL MEDIA CONSULTANT: It is supply and demand.
LEMON: How do they do this without backlash? Most women I know are not a 0, 00 or 000.
SHANKMAN: They're not going to be able to. I was in Tokyo last week and I was the fattest person in the country, by far and away.
EMME: I don't mean to laugh --
SHANKMAN: There's no question you're targeting for market size. In Europe, back in the 1500s, the average size of a man was 4 feet tall. Things do change, no question. Would this create backlash in America? Of course, it does because we should not be shaming women to being something they're not and promoting eating disorders. I have a 14- month-old daughter, I don't want her thinking her worth is based on the jeans she fits into. On the flip side, if there is a market for it, thin people who can fit in this, J. Crew has a fiduciary responsibility to sell to that market.
EMME: There is a problem with women who are petite, they don't want to be a non-size. They want to be a size 2. Make me a size 2 or if I have to be, I'll be a size 0. But it's almost producing their own self esteem that they're 000 or 00 --
SHANKMAN: It's sort of the reverse. If I can wear a large and not an extra large, to me that's a win, even though XL --
EMME: This is vanity sizing at its best.
SHANKMAN: I will say this. On the flip side, when a company does this, I posted this on my Facebook page, and about 15 women posted out that, you know, good, because I couldn't wear the size 0. Now I can go back to shopping at J. Crew because I am thinner than that. So there a market for it. I don't think it's shaming the audience.
EMME: I don't think that's their intent. There's a whole other psychological part of this that there is this discussion online, you're going to be seeing on our Facebook, on CNN after the show. You're going to hear about it.
LEMON: I prefer -- medium.
LEMON: This is Bethany Frankel from Housewives.
SHANKMAN: She blew this.
LEMON: She posted this on Instagram. It's her in her --
SHANKMAN: Her 4-year-old daughter's pajamas.
LEMON: You know -- there is shrinking -- people are thinner now.
EMME: But that also sending a message to women. We have to take a look at -- we need to have a standardization of sizes. In Australia, many years ago, women were very, very angry that if they walked into different stores they were like, wait a minute, I'm a size 12. Why do I go to another store I'm a 16, another store, I'm a 10. What they did was, they stopped shopping for a while and they re-standardized the sizing. So when a woman goes into different size -- different stores, she actually can buy what she wants in the size that she is aware of.
LEMON: The reason I show that picture, celebrities do have an influence. If they're really thin -- we see a lot of celebrities that are thin. SHANKMAN: But you're starting to see a backlash, celebrities come out and say I have curves and it's OK. And Bethany Frankel built her entire career on shakes that had half a calorie. That's to be expected from her. You see celebrities now, Jennifer -- "Hunger Games," Jennifer Lawrence. She is saying I look like me and I'm OK with that.
LEMON: Most of the women I know look like you.
EMME: Amen, baby. Thank you. Thank you, ladies and gentlemen.
LEMON: Thank you, Peter Shankman. See you guys soon. You know, if one photo can exude the muscle, money and stardom of Hollywood, this would be it. Sylvester Stallone, Harrison Ford, Arnold Schwarzenegger, Wesley Snipes. This is the cast of the upcoming, "Expendables 3." They've gathered for an incredible spread for "Vanity Fair."
And our entertainment commentator, Krista Smith, also the senior West Coast editor of "Vanity Fair." Everybody has big titles this year. Smart accomplished people. You helped put this shoot together. Tell me about it. What's going on here?
KRISTA SMITH, CNN ENTERTAINMENT COMMENTATOR: This is great. This is like such a great guilty pleasure, Don. So delicious all these people. They were premiering in the Cannes Film Festival in May there to walk the red carpet. Tanks were being down for the promotion of this film. We happened to get them all. This is called the Bellini Bar at Eden Roc, which is one of the most beautiful places on earth.
And they were all there. They're all assembled happy to be there in their own clothes. You just have to love Stallone's lavender blazer. It's good to see Harrison Ford there and Antonio Banderas. It was like a win-win for us.
LEMON: Yes, there is a lot -- lavender blazer. There's a purple one, a maroon one. So it was probably tough to pull this off. I want to read what Sylvester Stallone co-wrote, the "Expendables" franchise, which first debut in 2010. When is the third installment come out in theaters?
SMITH: Well, this one comes out in August 15th from Lion's Gate. They kind of launched the buzz there early on in May at the festival. It's a huge international film festival. Everyone got to talk about it. They all came, which is a huge testament to the Stallone and to the viability of the franchise.
Don, the great thing about it is they can keep going. It's one of those things where it's mercenary versus mercenary. In the original one, you know, Bruce Willis had a cameo and Mickey Rourke was in it. Liam Helmsworth was in the second one, now it's Cullen Lutz for someone under 40. It's a brilliant idea. It's a gift that keeps on giving.
LEMON: I can't wait to see the one in like 20, 30 years. Yes. I'm going to get you. This is my generation. I'm having a little fun. It's great to see these old guys like me on the cover and doing action movies. I think it's fantastic. There's a cover right there with the princess and her family on the front.
Thank you, Krista Smith, "Vanity Fair." Appreciate it. It's summer, it's hot and it seems like we keep hearing about parents leaving kids in cars. Are hot car incidents on the rise or are we just hearing more about them and are these bad parents? I don't know. Just really bad parents? Miguel Marquez will join us and we're going to discuss that coming up.
LEMON: It is only July and 17 children have died this year from the suffocating heat inside of a parked car. You know the story of Cooper Harris, a 22-month-old Georgia boy found dead in suburban Atlanta on June 18th. His father charged with felony murder. Since then, the disturbing trend of children left in cars baking in the summer sun seemingly continues. This map shows all the reports we know of from coast to coast.
CNN correspondent, Miguel Marquez, has been following the cases for you. Is it media attention or parents being negligent? What's going on?
MIGUEL MARQUEZ, CNN CORRESPONDENT: Some of it is negligence, but a lot of it parents being completely overwhelmed and forgetting their kid is in there. About 50 percent of the cases are about parents forgetting, 30 percent of the cases they say are from kids who get in the car themselves and suffocate and die.
And about 20 percent of the time parents leave their kids in the car knowing full well they're leaving them in the car to run and do an errand come back and forget in the meantime. So negligence comes down to whether or not they intended then for the child to die or if they did something so egregious that they left them in the car.
LEMON: I talked to a lot of people. They say I can't believe a parent can forget about their kid being in a car. But it happens all the time.
MARQUEZ: It happens more than you think. The numbers you put up earlier are the numbers we know about. There are thousands of cases that we don't know about.
LEMON: This time last year, there were more at this point.
MARQUEZ: There were. This year 17 dead so far this year. Last year it was 18 at this time of the year. We're running just about the norm.
LEMON: Accidental or not, you're going to run in the store for 5 minutes, you can still be charged.
MARQUEZ: You can still be charged. People are more aware of it these days. The problem that is happening in some places is that an older child will stay in the car because I want to stay in the car. Mom will leave them in the car. Somebody calls the cops and mom is charged. It turns into a nightmare for this mother. Those are the cases where overcharging occurs, as well. If you leave your kid in the car, beware right now.
LEMON: I see the video of good Samaritans rescuing animals from cars in the heat. Now you're starting to see good Samaritans rescuing children.
MARQUEZ: One would hope the good Samaritans would be looking out for children more than animals. Certainly people are watching out for kids a lot more because of Cooper Harris.
LEMON: You're going to be covering this tonight for us?
MARQUEZ: A much bigger look at all of this tonight 10:00.
LEMON: At 10 p.m. Eastern right here on CNN. Miguel and I will be here for "CNN Tonight." Make sure you tune in. Thanks again, Miguel. See you then.
A teen in Omaha, Nebraska snapped one of the most epic pictures of all time standing in front of Warren Buffett and Paul McCartney sitting just casually on a bench in the background. Chilling with his homies said the tweet that linked to a copy of the image on Instagram. The billionaire and Beatle had dinner at an Italian dinner in Omaha.
McCartney playing a show in Lincoln, Nebraska tonight. I'm going to be speaking with that kid also tonight at 10:00 p.m. on "CNN Tonight". Make sure you tune in.
I'm Don Lemon. Thanks for watching. Time now for Jake Tapper in "THE LEAD."