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Manafort Bookkeeper Testifies on Day 4 of Trial & Rick Gates Later Today; Suspected Russian Spy Worked in U.S. Embassy in Moscow; Ivanka Breaks with Trump on Media as "Enemy of the People". Aired 11:30-12p ET

Aired August 3, 2018 - 11:30   ET

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


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[11:33:13] KATE BOLDUAN, CNN ANCHOR: Extravagant clothes to say the least. You can't un-see that ostrich jacket. Multimillion dollar homes, extravagant landscaping and more. Prosecutors say, behind it all, Paul Manafort was desperately trying to keep it all together and quickly running out of cash. His longtime bookkeeper is on the stand for a second day. This, after telling the court Manafort was broke just two years ago, just as he was starting to work for the Trump campaign. All of this as prosecutors prepare to have Manafort's right-hand man, Rick Gates, take the stand and testify as early as today. Things are moving fast. Where do they stand right now?

Joining me to discuss, CNN legal analyst, Ross Garber.

Great to see you, Ross.

ROSS GARBER, CNN LEGAL ANALYST: Great to see you, Kate.

BOLDUAN: They are moving more into the documents evidence in this case, the meat of the case. What are you looking for or watching for to see kind of whose favor this is tipping towards?

GARBER: I'm a defense lawyer. So far, it's playing out pretty much as I have expected. Honestly, it's playing out much the same way cases like this play out all across the country. The government tries to show that information supplied to the government and banks was either inaccurate or incomplete. The defense will say, look, the defendant here didn't know all of the things that were being submitted to the government and to the banks. He was too busy doing his work. The Rick Gates testimony is going to be the key.

BOLDUAN: Rick Gates, he could testify as early as today. He is the key star witness working with the prosecution -- prosecutors on this. If he doesn't testify today, it would be early next week. What do prosecutors need from him if all the documents are already telling the story?

[11:35:02] GARBER: Right. The documents are going to show that the government, for tax purposes, didn't have all the information. The banks, for loan purposes didn't have all the accurate information. The documents are going to show that. What the documents aren't going to show necessarily is that Paul Manafort knew that the information that was being supplied was incomplete or false. That's going to be key to prove. It's going to be that that Rick Gates is potentially going to be able to supply. Rick Gates worked with Paul Manafort. He worked with him closely. I expect he will testify that Paul Manafort knew what was being submitted to the government, knew what was being submitted to the banks.

BOLDUAN: We know that the defense is basing their argument on Rick Gates as well, putting the blame on him instead of Manafort. What's that cross-examination going to look like?

GARBER: What's going to happen is, if you are a defense lawyer in this case, you will try to make this Paul Manafort versus Rick Gates. You will try to show that Rick Gates stole from Paul Manafort. We have heard that the defense is going to try to make that case, that Rick Gates stole from Paul Manafort. And also Rick Gates, the defense will say, is a liar and can't be believed and, actually, has incentive in particular to lie in this case because, remember, he had been indicted and he faced a long time and still faces a long time in jail. His get-out-of-jail card is held by the government. The only way he can reduce his sentence is by cooperating with the government, which means saying what they want him to say. So that's what I would expect from the Rick Gates cross-examination.

BOLDUAN: Stand by for the fireworks, Ross Garber is advising.

Great to see you, Ross. Thanks for coming in.

GARBER: Good to see you.

BOLDUAN: We will see. We will see if anyone wears an ostrich jacket.

Coming up for us, a suspected Russian spy is caught working in the U.S. embassy in Moscow. She's been working there for years. How does that happen? What happens now?

We will be right back.

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[11:41:44] BOLDUAN: Another shocking story coming out of Russia. Not what you may think. A suspected Russian spy working in the U.S. embassy there for more than a decade. She had access, according to officials, to the Secret Service's commuter system and e-mail system and she was having regular unauthorized meetings with Russian intelligence, the FSB.

Joining me with perspective on what's going on here, law enforcement analyst, Jonathan Wackrow. He was a former Secret Service agent and he served under President Obama.

Jonathan, the fact that this person has had access to the same computer system, same e-mail system, the intranet that Secret Service has, what does that mean she had access to?

JONATHAN WACKROW, CNN LAW ENFORCEMENT ANALYST: Well, first, it's important to understand that the Secret Service along with all U.S. government entities that are operating overseas cannot perform the function of their mission without the support of foreign service nationals.

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BOLDUAN: It doesn't shock you that there was someone -- a Russian national working with the Secret Service?

WACKROW: No, absolutely not. Based upon the press release put out by the Secret Service, actually, that was her role. Her role was a foreign service national investigator. Her role was to liaison with the police service in Moscow. That was her role. From that context, nothing abnormal.

What did she have access to? The Secret Service, State Department, there are very strict protocols on dealing with foreign service nationals to avoid classified information, sensitive information getting out. Stated in the Secret Service press release, did not have access to that type of sensitive information.

What's more troubling is, what did she have access to? What did they not put in here? She knew who the agents were that were working in the country. She knew the investigations that were ongoing to a certain point. She could pass that information on to Russian Foreign Intelligence Services that are trying to play a long game here. This wasn't a quick hit to access classified information. This was a 10- year plus operation potentially of information gathering, building a profile. Who are the agents? What type of investigations? It's a very complex information and intelligence gathering service that utilized this individual who was a trusted insider within the embassy. That's the most dangerous part of the insider threat that she was.

BOLDUAN: When an official told CNN this, a U.S. official told CNN this was not an issue of national security -- I get it, but how it is not though?

WACKROW: It isn't an issue of national security. It comes down to the context and word choice that was put into the press release. She did not have access to the president's personal schedule, did not have -- basically, she had access to open-source information that you may have access to. Maybe a little more because she was a Secret Service employee. Again, internal controls bifurcate the amount of information she can and cannot receive. So take that. It's the tangential information she was picking up, movements of personal, timing. Again, Russian intelligence services are playing a long game here. We're looking at the short-term loss. It's actually a long- term loss, the amount of information that this individual could have potentially gathered.

[11:45:06] BOLDUAN: Does it surprise you that -- I mean, no American government is going to hire a Russian national with the anticipation they will be a Russian spy. But does it surprise you that --

WACKROW: But you actually do. You have to go in with eyes wide open. You cannot execute the diplomatic mission -- it all comes down to risk appetite. What are you willing to risk to get the overarching mission done? Unfortunately, those are the challenges that the diplomatic corps have to face every single day. You have to make an assumption that information you are giving to a foreign service national will get back to intelligence services. It's been stated. That's a fact.

BOLDUAN: Assume there are spies among us?

WACKROW: There are spies among us and work around them.

BOLDUAN: Jonathan Wackrow is one of them.

(LAUGTHER)

Still, unsettling.

Great to see you, Jonathan. Thank you so much.

WACKROW: Thank you.

BOLDUAN: Coming up, President Trump taking aim at the media once again. Now his daughter, Ivanka, one of his most-trusted advisers, is not on the same page. The mixed messages from the Trump White House. Does it change anything? That's coming up.

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BOLDUAN: Imagine you're kayaking, quickly approaching a waterfall. Accident strikes and, instantly, you know you're paralyzed. Doctors aren't sure you'll ever walk again. That's what happened to one man until he met this week's "CNN Hero," Amanda Boxtel.

(BEGIN VIDEO CLIP)

NATE WHITE, FORMER KAYAKER: I'm a robot.

(LAUGHTER)

My goal has always been to make a full recovery, and I think a lot of people thought that was farfetched.

It was a lot of hard work. I remember when I made those first couple of steps, that's when I knew that making a full recovery was possible.

AMANDA BOXTEL, CNN HERO: He's living the miracle of what we all want, what we all aspire for, to stand up and do it on our own. He's doing it.

I haven't witnessed that too often in my lifetime.

(END VIDEO CLIP)

[11:50:06] BOLDUAN: That is amazing. To see more of Nate's story and learn more about Amanda's amazing program, go to CNNheroes.com. While you're there, you can donate to any of this year's "CNN Heroes."

We'll be right back.

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BOLDUAN: "The enemy of the people" -- President Trump makes no secret of his feelings towards the media. But this week, a break within the family. Trump's daughter, trusted adviser, Ivanka Trump, seemed almost surprised when asked at an Axios event if she shares her father's view.

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MIKE ALLEN, CO-FOUNDER & EXECUTIVE EDITOR, AXIOS: Do you think that we're the enemy of the people?

IVANKA TRUMP, DAUGHTER OF PRESIDENT TRUMP: Sorry?

(LAUGHTER)

ALLEN: Do you hit it media is the enemy of the people?

TRUMP: No, I do not.

(LAUGHTER)

ALLEN: That's not a view that's shared in your family?

TRUMP: Are you looking for me to elaborate?

ALLEN: Sure.

TRUMP: No, I do not feel the media is the enemy of the people.

(END VIDEO CLIP)

BOLDUAN: So maybe change was coming? No. A short time later, President Trump doubled down, tweeting this: "They asked my daughter, Ivanka, whether or not the media is the enemy of the people. She correctly said, no, it is the fake news, which is a large percentage of the media, that is the enemy of the people."

So while you are trying to make sense of that one, watch this. President Trump at a rally last night.

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DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Whatever happened to fair press? Whatever happened to honest reporting?

They don't report it! They only make up stories. But they can make anything bad, because they are the fake, fake, disgusting news.

(END VIDEO CLIP)

BOLDUAN: Fake, fake, disgusting news.

Here with me now, CNN politics reporter and editor-at-large, Chris Cillizza. There wasn't really a distinction made there between the fake, fake,

disgusting news and the rest of the media, Chris. I'm not really sure. But anyway, clearly Ivanka is not convincing her father or boss. Are we literally to a point where no matter what is reported, the president is never going to end this fight?

CHRIS CILLIZZA, CNN POLITICS REPORTER & CNN EDITOR-AT-LARGE: Kate, I'm sure you asked me an incredibly intelligent question about Donald Trump and the media, to which I could hear nothing.

But I will tell you this, Donald Trump, I think, loves the media more than he hates them. I think the thing that you find with him over and over again is he is obsessed with media coverage. He talks about how he used to get good press. Now he gets bad press. I think no president we've ever had consumes more media or cares more about the media. For all of his talk about the fake news, no one watches more.

[11:55:16] BOLDUAN: Let's try this again.

CILLIZZA: I can hear you now.

BOLDUAN: Chris, can you hear me?

CILLIZZA: Hello, Kate.

BOLDUAN: You had no idea. It was the best question I ever asked.

CILLIZZA: You were really good. I was watching you on the monitor, and it looked like a good one.

BOLDUAN: Thank you. Thanks so much.

OK. I do want to know this though, in 30 seconds.

CILLIZZA: Yes. OK.

BOLDUAN: How much -- does this do long-term damage? I'm very concerned about it.

CILLIZZA: Yes. Yes. All joking aside, it absolutely does. I don't think Donald Trump cares, which I think is terrifying. But it does do long-term damage. Again, when he says fake news, he means news that is not favorable to me. But that's not how it is received by the people to whom he is speaking. They think that the news is being made up. Folks, it's not. You can come and follow me around every day. You can see it.

BOLDUAN: And it's just bananas. If you want to look at the fact check from last night of things that he said, if he wants to talk about things that are fake and things that are not correctly stated. Just look at the fact checks from his remarks last night.

CILLIZZA: Right. Don't have to believe us.

BOLDUAN: Nice to see you, Chris. You can plug your ears again. I'm now done talking. CILLIZZA: Thank you.

BOLDUAN: Coming up, any moment now, police are set to hold a news conference in Texas. These are live pictures from where they're going to have the news conference. This comes as the search continues for the suspect in the killing of a Houston doctor who was a cardiologist for President George H.W. Bush. The search, what's happening, we'll take you there. Stay with us.

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