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EARLY START

Intel Chiefs Presented Trump with Claims of Russian Efforts to Compromise Him; Trump News Conference Today; President Obama's Farewell. Aired 4:30-5a ET

Aired January 11, 2017 - 04:30   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


[04:30:00] CHRISTINE ROMANS, CNN ANCHOR: Developing overnight -- classified documents presented to President-elect Donald Trump include allegations operatives from Russia claiming to have compromising information about Trump, both personal and financial. We have exclusive details.

JOHN BERMAN, CNN ANCHOR: Really, today might be the most significant day for president-elect Trump since the election. He holds a news conference facing reporters on questions on this Russian intelligence, also on how he will separate his business from the Oval Office. And not just that, more confirmation hearings in Congress as well.

ROMANS: And President Obama case good-bye, speaking nostalgically in his hometown. He urged the effort of cooperation and shared emotional words from his family. A tear was wiped from the stage and a lot from the audience.

Welcome back to EARLY START. I'm Christine Romans.

BERMAN: I'm John Berman. Looking at 30 minutes past the hour right now.

And we do have new developments this morning on the big story you heard first here on CNN. CNN has learned that the nation's top intelligence officials provided information to President-elect Trump and President Obama last week, on claims of Russian efforts to compromise President-elect Trump.

CNN's Jim Sciutto is on the team that first reported the story. He joins us now with the latest.

(BEGIN VIDEOTAPE)

JIM SCIUTTO, CNN CHIEF NATIONAL SECURITY CORRESPONDENT: John and Christine, multiple U.S. officials with direct knowledge of the briefings tell CNN that classified documents presented on Russian interference in the 2016 U.S. election presented last week to President Obama and to President-elect Trump included allegations that Russian operatives claim to have compromising personal and financial information about Mr. Trump.

The allegations were part of a two-page synopsis based on memos compiled by a former British intelligence operative whose past work U.S. intelligence officials consider credible. The FBI is investigating the credibility and accuracy of the allegations which are based primarily on information from Russian sources. But the FBI has not confirmed many essential details in the memos about Mr. Trump.

The classified briefings last week were presented by four of the most senior intelligence chiefs, Director of National Intelligence James Clapper, the FBI Director James Comey, CIA Director John Brennan, and NSA director, Admiral Michael Rogers.

The two-page synopsis included allegations that will was a continuing exchange of information during the campaign between Trump surrogates and intermediaries for the Russian government, this according to two national security officials.

CNN has confirmed that the synopsis was included in the documents that were presented to Mr. Trump but it cannot confirm if it was discussed in his meeting with those intelligence chiefs.

Now, the transition team for Trump has declined to comment formally to CNN as did the Office of the Director of National Intelligence and the FBI, but we do have Donald Trump tweeting apparently in response to the story, calling it fake news -- John and Christine.

(END VIDEOTAPE)

ROMANS: All right. neither intelligence officials nor the Trump transition team has offered any kind of formal statements on these revelations.

But Trump senior adviser and former campaign manager Kellyanne Conway was on "Late Night with Seth Meyers" overnight and she offered this immediate reaction.

(BEGIN VIDEO CLIP)

SETH MEYERS, LATE NIGHT WITH SETH MEYERS: CNN had a report that the intelligence community briefed both the president and president-elect with allegations that the Russian government has compromising information on President-elect Trump, both business information and personal information. I know this just happened. Can you confirm or comment the fact that the intelligence community has presented this to Donald Trump?

KELLYANNE CONWAY, INCOMING WHITE HOUSE COUNSELOR: Well, guess what hasn't happened, Seth? Nobody has sourced it. They're all unnamed, unspoken sources in the story. And it says it was based on a Russian investigator to begin with. So, where are we?

MEYERS: I think it was based on an MI-6 British investigation.

CONWAY: Right. Well, one of those and then it says it also may have originated with a Russian investigator. It also says Hillary Clinton -- groups that wanted Hillary Clinton to win may have been behind the investigations itself.

And most importantly, it says that the FBI is trying to confirm it. So, nothing has been confirmed.

And I have to say as an American citizen regardless of your party, or if you don't like politics at all, which are many Americans, we should be concerned that intelligence officials leaked to the press and won't go and tell the president-elect or the president of the United States of United States himself now, Mr. Obama, what the information is. They would rather go tell the press --

MEYERS: But the report was -- the press report was about them going to the president.

CONWAY: And it says that they never briefed him on it. That they appended to two pages on the bottom of his intelligence report.

MEYERS: I believe it said that they did brief him on it.

CONWAY: Well, he has said that he is not aware of that.

MEYERS: OK, that concerns me.

(LAUGHTER)

CONWAY: No, no --

MEYERS: I'm concerned. But in general, I just want to --

CONWAY: (INAUDIBLE)

MEYERS: No, I understand --

CONWAY: And it's not true.

MEYERS: What is not true? That I'm concerned?

CONWAY: No, that I see --

MEYERS: OK, I assure you that I am.

(LAUGHTER)

(END VIDEO CLIP)

ROMANS: All right. Here's what we know. As Jim Sciutto reported, CNN has confirmed the synopsis of the claims was included in the documents presented to Mr. Trump.

[04:35:07] But we cannot confirm, if the information was actually discussed in the president-elect's meeting with those intelligence chiefs.

BERMAN: And again, what the focus on here, is the fact that this was included in the synopsis, the two pages were included, it shows some concern among the intelligence officials. Not necessarily what was in them but the fact of the transfer is interesting.

Officials with knowledge of the briefing tell CNN that there was another reason that the intelligence chiefs included that synopsis in their briefing documents. They believe it showed that Russia had compiled information potentially harmful to both political parties and campaigns but only released information damaging to Hillary Clinton and the Democrats.

The synopsis was not official part of the report from the intelligence community about Russian hacks, but some officials said it added to the evidence that Moscow intended to harm Clinton's candidacy and help Trump's.

One high level administration official told CNN, quote, "I have a sense the outgoing administration and intelligence community is setting down the pieces so this must be investigated seriously and run down." The official added, "I think the concern was to be sure that whatever information was out there is put into the system so it is evaluated and it should be and acted upon as necessary".

ROMANS: The topic of the Russian hacking investigation came up on Capitol Hill. At a Senate Intelligence Committee hearing, FBI Director James Comey was asked whether the bureau was looking into links between the Trump campaign and Russia. Comey refused to say, leading to this exchange with independent Senator Angus King.

(BEGIN VIDEO CLIP)

SEN. ANGUS KING (I), MAINE: Mr. Comey, did you answer Senator Wyden's question that there is an investigation underway as to connections between either the political campaigns and the Russian -- Russians?

JAMES COMEY, FBI DIRECTOR: I didn't say one way or another.

KING: You didn't say --

COMEY: That was my intention at least.

KING: You didn't say one way or another whether even there's an investigation under way?

COMEY: Correct, I don't -- especially in a public forum, we never confirm or deny a pending investigation. I'm not saying --

KING: The irony of you're making that statement there, I cannot avoid. But I'll move on.

COMEY: But we sometimes think differently about closed investigations.

(END VIDEO CLIP)

ROMANS: The irony that Senator King was talked about refers to Comey's decision to keep mum yesterday versus his announcement in the final weeks of the 2016 campaign to tell Congress the FBI was once again reviewing Hillary Clinton's e-mails.

BERMAN: And this is all but certain to come up again today on Capitol Hill in a very major way, and a very crucial hearing. The Senate Foreign Relations Committee is taking up the confirmation of President-elect Trump's nominee for secretary of state, Rex Tillerson.

As CEO of ExxonMobil, Tillerson did extensive business with Russia and Vladimir Putin. But this morning, he is scheduled to give an opening statement that says that Russia poses a danger and Russia must be held to account for its actions.

Also in the spotlight, the second day for confirmation hearings for Attorney General nominee, Jeff Sessions. Today, the Senate Judiciary Committee hears unprecedented testimony against Sessions nomination from a fellow senator, pretty unprecedented, New Jersey's Cory Booker.

Joining us with the latest on today's busy schedule, CNN national security reporter, Ryan Browne live in Washington.

Ryan, again, I have to believe that the tenor of the hearing today may be different given this new reporting on Russian intelligence?

RYAN BROWNE, CNN NATIONAL SECURITY REPORTER: That's right, John. I think with Rex Tillerson, we were always going to hear a lot of questions about Russia. He did receive an Order of Friendship back in 2014 from Vladimir Putin and he had business ties while running Exxon there that were cancelled by Russia's intervention in Ukraine and annexation of Crimea.

So, there were always going to be a lot of questions about Russia. Senators are moving in that direction and we can expect that today.

And then, with Jeff Sessions again, we'll be seeing, we'll be hearing from him who testified for hours and hours yesterday. We'll be hearing about some other witnesses who speak. You mentioned Cory Booker. Some others from the NAACP and some of those supporting him like former Attorney General Mukasey.

Sessions endured a lot of questions yesterday, everything from Muslim registry to legalization of marijuana. But one question in particular from Vermont Senator Patrick Leahy got everyone's attention.

(BEGIN VIDEO CLIP)

SEN. PATRICK LEAHY (D), VERMONT: Is grabbing a woman by her genitals without her consent, that sexual assault?

SEN. JEFF SESSIONS (R-AL), ATTORNEY GENERAL NOMINEE: Clearly, it would be.

LEAHY: If a sitting president or any other high federal official is accused of committing what the president-elect described in a context in which it could be federally prosecuted, would you be able to prosecute and investigate?

SESSIONS: The president is subject to certain lawful restrictions, and they would be required to be applied by the appropriate law enforcement official.

(END VIDEO CLIP)

BROWNE: And again, that was Sessions yesterday.

And also yesterday was General John Kelly, who is Trump's pick for heading the Homeland Security Department.

[04:40:05] He kind of broke from Trump a little bit on things like waterboarding and the idea of a registry for Muslims. He also said that a wall on the southern border wouldn't necessarily be enough to secure it, and that other measures were need. And Democrats expressed support for him. So it looks like he'll be approved and confirmed for that position in a short period of time.

BERMAN: It's interesting to hear the nominees on Capitol Hill. None of whom feel particular allegiance to many of the promises made by Donald Trump on campaign trial, but I'm sure the Trump transition team is OK with that, to ensure a smooth confirmation process.

Ryan, great to have you. Thanks so much.

BROWNE: Sure thing.

ROMANS: Oh, but wait, there's more. For the first time since the election, Donald Trump will host a news conference today. You can watch it right here on CNN at 11:00 a.m. Eastern. This was that press conference originally scheduled for December 15th. It was abruptly postponed.

The big question, how will Trump separate himself from his many overlapping businesses? Now, Trump has said he will not sell off his assaults. He will transfer them to his sons. That will be quite an undertaking.

Trump owns some or all of 564 companies. This is according to his most recent disclosure, 144 of those do business in 25 countries. Trump has full or partial ownership of 52 pieces of real estate.

Trump spokesman Sean Spicer says the president-elect will give a statement and then take questions at this presser. That's really a true press conference. He'll discuss his plans for the economy and job creation and we'll likely hear his thoughts about repealing and replacing Obamacare and the timing on that.

He told "The New York Times" yesterday, he wants that done quickly but there's tension among GOP lawmakers on what a replacement will look like.

At the same time, more people are signing up for Obamacare, 11.5 million Americans have enrolled on federal and state exchanges. That's up from last year. Fewer people are paying the penalty for not having coverage, 6.5 million Americans were whacked with fees on their 2015 tax returns. The average fine is 330 bucks down from $8 million from the year before who paid about $95 each.

That fine jumped, right? This is meant to be something that pushes you into the insurance market. The fine jumps to $695 for those who didn't have coverage last year. Now, it becomes, you know, it becomes more inexpensive to get the coverage than to pay the fine and go uncovered.

BERMAN: I'm very interested to hear what the president-elect says about Obamacare and the time frame he would like to see. Because it's uncertain for right now, something that Republicans have promised for such a long time a great deal of uncertainty.

ROMANS: Look, there are some Republicans who just say repeal, repeal, repeal. We have promised that. We have promised that.

There are others who say if you don't repeal and replace it with something good right away, then we own this problem. Republicans own that problem and then that could be a problem down the road.

BERMAN: All right. With all of this going on, President Obama delivered his farewell address last night. This was an emotional farewell.

The president urging citizens to stay vigilant to the protection of basic human values. He urged Americans to come together, insisting we rise and fall as one. And he also, you also see it right here, he teared up when he thanked the first lady for taking this journey with him.

CNN's Michelle Kosinski was in Chicago for this speech.

(BEGIN VIDEOTAPE)

MICHELLE KOSINSKI, CNN WHITE HOUSE CORRESPONDENT: Hi, John and Christine.

There was so much energy that this hometown crowd for President Obama. The cheering and stomping so thunderous, that it took him a few minutes to even get started. And his speech in fact went on about twice as long as expected.

It was a thank you, a good-bye. But it was a very big cautionary tale. The president going into great detail on what he feels to be a major threat to democracy itself right now, including inequality, racial division, complacency, and people retreating in their own bubbles. I mean, he went off on what he called naked partisanship as well as fake news.

Listen.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Politics is a battle of ideas. That's how our democracy was designed. In the course of a healthy debate, we prioritize different goals and the different means of reaching them. But without some common baseline of facts, without a willingness to admit new information, and concede that your opponent might be making a fair point, and that science and reason matter, then we're going to talking past each other. And we'll make common ground and compromise impossible.

KOSINSKI: Despite these multiple pointed warnings, the president did try to keep this optimistic, tried to be inspiring, urging Americans to talk to each other, listen to each other, get involved. He said he still very much believes in the power of ordinary people to work together and effect change. And he said, if you don't like the way politics is going right now, then you need to run for office -- John and Christine.

(END VIDEOTAPE)

[04:45:05] ROMANS: All right, Michelle Kosinski.

So, where was Sasha? That was a big question during last night's farewell address. Michelle and Malia were there. But the younger daughter, the first daughter, was a no show.

Well, mystery solved. Senior officials tell us Sasha has a big exam this morning. And guess what? Studying for a test is more important than seeing your dad like retirement speech.

BERMAN: Good luck on that exam today.

ROMANS: Yes, exactly. Eat a good breakfast.

BERMAN: I know, you say that. I think good night sleep.

ROMANS: Well, she got that. So eat a good breakfast.

BERMAN: All right. The president-elect met with a noted anti-vaxxer. And the question is, did he offer the chance to head up a conference or committee on vaccines? That's next.

(COMMERCIAL BREAK)

ROMANS: Six senior Pentagon officials have been asked to stay on the job during the early stages of the Trump administration to ensure the U.S. can respond quickly in a crisis. The most senior official to receive the request is Deputy Defense Secretary Robert Work (ph). He would serve as acting defense secretary if General James Mattis is not sworn into office by the time Mr. Trump becomes president. Mattis needs a special waiver from Congress to be confirmed.

BERMAN: Trump transition team is denying reports that Robert Kennedy Jr. has been asked to head up the vaccine safety commission, if they in fact have a commission.

[04:50:01] Kennedy, who was an outspoken vaccine skeptic, I called him anti-vaxxer in the tease. He's a skeptic. He says his children have received vaccination. He met with Trump in New York yesterday and told reporters he was asked to chair a committee on safety. A spokesman for Trump says the president-elect enjoyed his discussion with Kennedy, but again, it's not made a final decision on whether there's a committee and who will head it up.

ROMANS: All right. The transition team is trying to tamp down tensions with Hispanics, following a contentious election that featured anti-immigrant rhetoric and a call to build the wall, the border with Mexico. Transition officials met in Washington with Hispanic leaders who say the Trump team message was the war is over. Latino leaders say transition officials made it clear they're ready to collaborate on an array of issues, including immigration and deportation.

BERMAN: Publishing giant Harper Collins has decided to stop selling a book by Monica Crowley after a CNN KFILE uncovered more than 50 passages that were plagiarized. Crowley is President-elect Trump's pick to be a senior director of strategic communications for the National Security Council. Crowley's 2012 book "What the Bleep Just Happened" lifted work published by -- appeared to lift work published by columnists, news reporters and think tanks.

ROMANS: All right. Fifty-one minutes past the hour.

Volkswagen close to reaching an enormous settlement with the U.S. government. We're going to tell you how much the company will pay for that horrible emissions scandal and the rare move it is making to accept responsibility. That's next.

(COMMERCIAL BREAK)

ROMANS: Happening today, the man who murdered nine people inside a historical black church will be sentenced to death. A judge will formally condemn Dylann Roof to death this morning in the massacre at Emanuel AME Episcopal Church in Charleston, South Carolina, in 2015. The 22-year-old said he felt he had no choice but to kill. He feels no remorse.

A brother of one of the victims says he feels conflicted about Roof's punishment.

(BEGIN VIDEO CLIP)

[04:55:03] MELVIN GRAHAM, BROTHER OF CHARLESTON SHOOTING VICTIM: It's a hard thing knowing that someone's going to lose their life. But when you look at the totality of what happened, it's hard to say that this person deserves to live, when the nine others don't. How do you justify saving one life, and he took nine? And in such a brutal fashion, with no remorse. He just took them away from us.

(END VIDEO CLIP)

ROMANS: Roof is the first person convicted of a federal hate crime to be recommended for death.

BERMAN: A $100,000 reward is now being offered for information leading to the arrest of suspected police officer killer Markeith Lloyd. Lloyd is wanted for the shooting death of an Orlando sergeant on Monday, as well as the murder of his own pregnant ex-girlfriend last month. There was a candlelight vigil for Master Sergeant Debra Clayton in the Walmart parking lot where she was shot and killed. Her funeral is scheduled for Saturday.

ROMANS: All right. Muslim parents in Switzerland are now required to send their children to coed swimming class. The European Court of Human Rights says that very flexible arrangements are offered in the city where this case brought, such as allowing girls to wear burkinis during lessons alongside boys. Older girls, girls who have entered puberty are allowed exceptions from this ruling. They're not forced to take swim lessons in the same pool at the same time with boys.

The court acknowledges that it does interfere with freedom of religion but it says the law is designed to protect students from social exclusion.

All right. Let's get a check on CNN Money Stream right now.

Investors will be focused on Donald Trump with a big news conference today in New York, stock futures ticking slightly higher, the NASDAQ riding a four-day streak of record highs for NASDAQ. Stock markets in Europe and Asia right now, they are mix.

BERMAN: What happens if we never get to 20,000?

ROMANS: You know, we need one more piece of news before it gets to 20,000. It just sits below 20,000.

BERMAN: I'm getting antsy.

ROMANS: You're getting antsy. All right. We'll send out that message.

We're watching shares of GM today. General Motors stock popped almost 4 percent Tuesday. The automaker with a surprisingly good upbeat outlook for next year. That capped a 26 percent gain over the past year.

Overall, auto sales are expected to level off after two straight weeks of record gains. But GM says, it's still growing in China and other emerging markets.

Meantime, rival Volkswagen is negotiating a settlement with the U.S. Justice Department over that horrid emission scandal. It will require the carmaker to pay $1.43 billion in fines. It will have to pled guilty to criminal wrongdoings, something these types of settlements don't usually include.

It would also require Volkswagen to appoint an independent monitor to oversee its operations for the next three years. Volkswagen executive was arrested by the FBI earlier for his role in the alleged cheating, and attempts -- alleged attempts to cover it all up.

All right. Current and former employees of Hardee's and Carl Jr. went to Capitol Hill to blast their former boss. Who is their former boss? The guy who is the nomine for labor secretary.

(BEGIN VIDEO CLIP)

LAURA MCDONALD, FORMER CKE EMPLOYEE: I gave more than 20 years of my life to CKE and Mr. Puzder took a company that I love and turned into a business that takes money by stealing from its workers. I honestly can't think of anyone less qualified to enforce the laws that are supposed to protect employees.

(END VIDEO CLIP) ROMANS: Other former employees said the company has taken their wages, overtime pay and vacation day. CKE is the parent company of Hardee's and Carl's Jr. Puzder has been CEO since 2000. He is credited with turning around the Hardee's brand.

He opposed the $15 minimum wage. He's a critic of Obamacare. He has also been accused of labor violations and face complaints about sexist commercials. A Trump aide says Puzder has first hand experience saving and creating thousands of jobs and he has an extensive record of fighting for workers. His Senate confirmation hearing has yet to be scheduled.

BERMAN: Just to be clear along with the rest of the president-elect nominees, he is likely, he is likely to be confirmed.

EARLY START continues right now.

(MUSIC)

ROMANS: Developing overnight -- classified documents presented to President-elect Donald Trump include allegations operatives of Russia claim to have compromising information about the incoming commander- in-chief, both personal information and financial. We have exclusive details.

BERMAN: Just minutes ago, the Russians weighed in.

All of this ahead of a very big day for Donald Trump, his first news conference in more than six months. He will face questions on this report about Russian intelligence. Also about Obamacare. Also, about his own personal finances. That as more nominees face hearings on Capitol Hill.

ROMANS: And President Obama says farewell in a speech that was both forceful and nostalgic.