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Virginia Murder Trial; Trump Surging 1,000 More Immigration Officers to Minneapolis?; Trump Threatens Iran; DOJ Targets Jerome Powell. Aired 1-1:30p ET

Aired January 12, 2026 - 13:00   ET

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

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BRIANNA KEILAR, CNN HOST: Weighing options. President Trump considering possible military intervention during deadly anti- government protests in Iran. And Tehran says it's -- quote -- "prepared for war," but ready to negotiate.

BORIS SANCHEZ, CNN HOST: Plus: Fed feud. The administration's fierce campaign against the Central Bank chairman escalating to a new level, federal prosecutors launching a criminal investigation into Jerome Powell. How Powell is now responding in an unprecedented way.

And surging in. Sources tell CNN around 1,000 more immigration officers are heading to Minneapolis, as tensions flare after last week's deadly ICE shooting.

We're following these major developing stories and many more all coming in right here to CNN NEWS CENTRAL.

KEILAR: The death toll is climbing in Iran just hours after President Trump escalated his threats against the regime there.

According to a U.S.-based rights group, more than 500 anti-government protesters have been killed in just over two weeks of demonstrations. Thousands of others reportedly arrested, including children. And while CNN cannot independently stop the attack, the U.S. verify these numbers, they suggest the ongoing wave of protests is among the deadliest that Iran has seen in years.

Chants of "Freedom" can be heard echoing in one of the latest videos to make it out of the capital, despite a near-total Internet blackout. President Trump says he's now weighing military action in response to the crackdown. But Iran's foreign minister says -- quote -- "We do not want war, but we are completely prepared for it."

Today, thousands of pro-government demonstrators have been taking to the streets.

CNN's Kristen Holmes is live for us at the White House.

Holmes, some pretty lofty words here from the president in recent days. What's the latest there?

KRISTEN HOLMES, CNN SENIOR WHITE HOUSE CORRESPONDENT: Yes, Brianna, it certainly feels as though both the rhetoric and the tension are escalating.

What we know right now is that a series of different agencies have been involved in the preparation of President Trump should he decide to take some sort of action. On top of that, we are told at this point that there's going to be several briefings throughout the week, including tomorrow, when Trump will convene some of his top national security officials.

So just to give you a quick breakdown of what exactly they're weighing in terms of options, you mentioned that the military strikes on the regime, that's not the only thing on the table. They are also talking about targeting security services that are used to tamp down protests.

They're also talking about cyber operations. That's one of the things on the table, as well as new sanctions. Now, not everybody is on board with this idea of potential military strikes in Iran. There are several people within the administration who are concerned that that could actually backfire, that you could see rallying around the government in that case, or actually seeing the government take this out on the protests, or on the United States, for example.

We did hear from one Iranian official saying that, if the U.S. was to strike, that it was possible that Iran would seriously look at various targets like U.S. military or shipping ports, just for one example there.

Now, we do know that the Iranian foreign minister has reached out to Middle Eastern envoy, Steve Witkoff. This is what President Trump said about that.

(BEGIN VIDEO CLIP)

QUESTION: Iran said that they would consider military and commercial bases as legitimate targets if you struck. Are you concerned about...

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Well, if they do that, we will consider things, targets they wouldn't -- that they wouldn't believe. If they do that, we will hit them at levels that they have never been hit before. They won't even believe it. I have options that are so strong.

(END VIDEO CLIP)

HOLMES: So, it's still unclear whether or not this is just posturing between these two governments, but, again, it does certainly seem as though things are escalating.

KEILAR: It certainly does.

Kristen Holmes, live for us with the latest at the White House -- Boris.

SANCHEZ: Today, the Justice Department is launching a criminal investigation into the Federal Reserve and its chair, Jerome Powell.

Prosecutors are focused on his June testimony before Congress about the Fed's $2.5 billion renovation of its D.C. headquarters. A spokesperson for DOJ told CNN the attorney general wants to -- quote -- "prioritize investigating any abuse of taxpayer dollars."

In a rare video statement posted last night, Powell responded, saying this investigation is part of the Trump administration's pressure campaign over interest rates. Watch this.

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(BEGIN VIDEO CLIP)

JEROME POWELL, FEDERAL RESERVE CHAIRMAN: The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the president.

This is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions or whether instead monetary policy will be directed by political pressure or intimidation.

(END VIDEO CLIP)

SANCHEZ: Now lawmakers are also responding.

North Carolina Republican Senator Thom Tillis blasted this probe, vowing to fight the move on X, saying: "If there were any remaining doubts about whether advisers within the Trump administration are actively pushing to end the independence of the Federal Reserve, there should now be none."

Tillis going on to say: "I will oppose the confirmation of any nominee for the Fed, including the upcoming Fed chair vacancy, until this legal matter is fully resolved."

Let's discuss with Robert Armstrong. He's a U.S. financial commentator for "The Financial Times."

Robert, thank you so much for being with us this afternoon.

You actually predicted that this investigation might hinder the president's hopes to see interest rates immediately cut. Why is that?

ROBERT ARMSTRONG, U.S. FINANCIAL COMMENTATOR, "FINANCIAL TIMES": Simply because the president, with this kind of unforced error, which is how I would describe this lawsuit, has given markets very good reason to worry about Fed independence.

And that in turn raises the possibility that inflation might more easily -- inflation expectations might more easily become unstuck. So he has literally given the Federal Open Market Committee, which is the group of people who sets rates, more reason to keep rates where they are, rather than cut them. SANCHEZ: The president has suggested that he knows nothing about

this, despite publicly for months blasting Jerome Powell and saying that he wants to see interest rates immediately cut.

I just want to put that in context for our viewers. I wonder if you could give us some context around the value of the Fed's independence. Is it quantifiable? Because, obviously, markets depend on the Fed's ability to plan long-term. And so even the semblance of a lack of independence by the Fed could hurt markets.

ARMSTRONG: Yes, the important thing to keep in mind is that what the Fed appears to be is much more important than the decisions the Fed makes.

The Fed is like an emergency break when inflation gets out of control or when unemployment gets out of control. And the market needs to trust that, when push comes to shove, they will be ready to take strong action. And what the president has done -- or, I should say, the administration or the Department of Justice has done with this lawsuit is draw the Fed's readiness to take action in difficult situations into doubt.

This is a situation where appearances really matter.

SANCHEZ: We just pointed out the statement from Senator Thom Tillis, lawmakers suggesting that this investigation could potentially impact the confirmation of Powell's replacement, which is due in a matter of months.

How much trouble do you think the administration faces now in confirming Powell's replacement?

ARMSTRONG: (AUDIO GAP) whisperer, as it were, but I can tell you I think there should be big trouble.

In my view, at this point, any candidate for chair of the Federal Reserve who accepts the nomination of this administration while this legal matter is open has thereby disqualified themselves from holding the job.

What we need from a Fed chair is someone who insists on the importance of Fed independence. And accepting a nomination from the Trump administration right now is to signal the opposite, that you don't take independence seriously at all.

SANCHEZ: Do you think it's going to wind up being Kevin Hassett, the chair of the National Economic Council for President Trump?

ARMSTRONG: I mean, it seems to be Hassett or Warsh.

But I think with members of the crucial committee in the Senate threatening to block nominations, I think there could be a problem here where the schedule for getting a new nominee in place could be significantly held up.

But I think the -- yes, you have named one of the two most likely candidates, Hassett, and the other is Warsh. And, again, whatever their individual -- their individual qualifications are, being associated with this action by the administration tanks them, perhaps in an irreparable way.

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SANCHEZ: Wow.

Robert Armstrong, great to get your perspective. Thanks for joining us.

ARMSTRONG: Thanks for having me.

SANCHEZ: Of course.

Still to come this afternoon: Minneapolis on edge after a deadly ICE shooting. And CNN is learning that nearly 1,000 more immigration officers are now headed to the city.

Plus, jury selection under way in the trial of a man accused of conspiring with the family's au pair to kill his wife and another man. We're going to break down this case.

And, later, a suspect arrested after a fire destroys a historic Mississippi synagogue -- the latest details when we come back on CNN NEWS CENTRAL.

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SANCHEZ: Tensions are building in Minneapolis following last week's deadly ICE shooting of Renee Good, a resident there.

Protests have been escalating. And now CNN has learned that DHS is deploying 1,000 more Border Patrol officers into the city and also conducting targeted door knocks.

KEILAR: And over the weekend, there was more video that showed physical confrontations between protesters and federal officers, CNN obtaining this video showing one agent shoving a man who was blocking an ICE vehicle.

The man fell down into oncoming traffic just as a bus was approaching. In another incident, video captures federal agents forcing their way into a home to detain a man as protesters stand in the front yard.

CNN's Priscilla Alvarez is here.

Priscilla, DHS says it's made over 2,000 arrests since its surge began last month. What are you learning?

PRISCILLA ALVAREZ, CNN CORRESPONDENT: Well, the department is continuing to build upon the presence that they currently have in Minneapolis. Remember, they started to increase the number of agents there in

December, when this operation kicked off at the time stemmed in that welfare fraud scandal that the administration has talked so much about. And then earlier this month, they sent 2,000 additional federal agents.

And I'm now learning that, as of Friday, they started sending an additional 1,000 more in the wake of the shooting that you just talked about there. Now, all of this is to build on the immigration crackdown in Minneapolis and also Minnesota.

But I have to say, someone who's covered this for some time, this is an extraordinary amount of federal agents going to one place to conduct immigration arrests. And it's not just those in the Somali community, which is really how this all began, because, again, going back to that welfare fraud scandal, but also anyone else in the state that is undocumented, as well as in Minneapolis.

Now, of course, local officials had said in the wake of that shooting they did not want federal agents in the city, in fact, saying quite the opposite. They really wanted them to get out. But the department and the secretary have maintained that they are going to remain in Minneapolis, in Minnesota. They're not budging on that front, and this operation is continuing.

In fact, she shared a little bit more about it during an interview with Jake Tapper just yesterday.

(BEGIN VIDEO CLIP)

KRISTI NOEM, U.S. HOMELAND SECURITY SECRETARY: We have arrested dozens and dozens of murderers and rapists, individuals who have assaulted children and sodomized them. We just released a whole list of individuals just in Minnesota that we have arrested since we have surged personnel there. And it's incredible.

So we would love it if the Minneapolis police force and the governor and the State Department -- state police department would partner with us to help us do this.

(END VIDEO CLIP)

ALVAREZ: But, of course, her saying there that she wants them to partner with them, there's simmering tensions here between the police and with the Department of Homeland Security.

So we will see what happens on that front, but they are sending more agents there as we speak.

SANCHEZ: When it comes to the actual operations that they're conducting, we saw that video of them going into that home. What can you tell us about that?

ALVAREZ: So they have been described to me as targeted operations. That means that they have people that they are specifically going after, be it having criminal records or not, but they are here illegally, according to the Department of Homeland Security.

So, those door knocks that we hear so much about, that -- they can bring in that instance a document like an administrative warrant, but that warrant doesn't carry the same legal weight as a judicial warrant. It's really -- so, in addition to that, they're also, for example, leaving copies of orders of removal if they are not at home.

So, all of this taken together is a mix of the immigration crackdown they're continuing in this city, as the local officials tell them that they shouldn't be there, but in addition to that, they can also serve other functions. For example, late last week, we saw them serving as a security perimeter, them being the agents around the federal building where they're processing. So it can be both.

But it's worth noting as well that the undercurrent here is that this is politically charged, not only because of what occurred there last week, but also, even before that, with the administration's intense focus on this fraud scandal in the state.

KEILAR: Priscilla, thank you so much for the latest there.

And next: a former IRS agent, an au pair, and an alleged plot to kill the wife standing between them. We're following a stunning double murder trial out of Virginia.

SANCHEZ: Plus, after referring to himself as the acting president of Venezuela, Trump says he's cutting off Cuba's access to that country's oil.

We will discuss next.

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KEILAR: Jury selection is under way in the gruesome double murder trial of a Virginia man accused of killing his wife and another man, a plan that prosecutors say he crafted with his mistress, the family's Brazilian au pair.

They claim this salacious plot involved luring a stranger to the home for a supposed sexual rendezvous with the intention of killing and framing him for the death of Brendan Banfield's wife, Christine. Banfield has pleaded not guilty.

CNN correspondent Jean Casarez is joining us now.

So, Jean, just walk us through this case and what we should be expecting at trial.

JEAN CASAREZ, CNN CORRESPONDENT: Well, this is Northern Virginia. They're going through jury selection today, Fairfax County.

And this is real. No matter if you feel the prosecution is correct or the defense is correct, this is real, what I'm going to tell you, the facts, according to the prosecution initially. Brendan Banfield right there was an IRS agent at the time. And his

wife, Christine Banfield, she was a pediatric intensive care nurse. And they had a very young daughter. And in 2021, they decided to hire an au pair to help with the raising of their little girl. And it was a live-in au pair. That's the victim right there. That is Christine Banfield, the pediatric nurse.

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Well, the au pair came. They hired her out of Brazil. It was Juliana Peres Magalhaes. And that's Juliana. So she came to live with the family. And within months, they started having an affair. And according to the prosecution, Brendan, right there, told the au pair: I have got to figure out a way to get rid of my wife, because you and I are a wonderful couple.

And so he, according to prosecutors, devised a scheme where he registered on FetLife.com, a sexual Web site, purporting to be Christine, asking for an escort to come to their home. And he found one, Joseph Ryan, also a victim. And Joseph Ryan would come to homes with a knife as part of the role-playing.

So, in 2023, February 24, Joseph Ryan came to the home early morning. Christine was still very much asleep in her bed, according to prosecutors. He went up to the bedroom, and, shortly thereafter, Brendan, the husband, and the au pair went into the bedroom.

Brendan took out his service revolver, issued by the IRS, and actually shot him in the head, according to prosecutors. He then took the knife, the husband did, to the wife and started stabbing her to death. The au pair took her gun, because she had one too. Because she saw that Joseph Ryan, the escort was moving a little bit, she shot him again to make sure he was deceased.

So, originally this was self-defense because an intruder came into the home. Months passed. Investigators went to the home. And what do you think they found in the main bedroom? They found -- I think we have got it to show everybody -- a picture, and it shows Brendan Banfield along with the au pair on the nightstand in the main bedroom.

Also in the closet, by the way, were the au pair's clothes. She had moved her clothes into that main bedroom. Well, finally, in 2023, there was an arrest. And it was of the au pair. She was arrested initially, and then months later Brendan Banfield. They were both charged with murder.

But then the au pair goes to authorities and she, according to prosecutors, tells them everything, what he planned, what he did, and how it effectuated out with the deaths of these two people. So she got a plea deal that's very good, involuntary manslaughter, and she may be out after sentencing if he's convicted.

He is charged with double murder. And the trial should begin as soon as with opening statements tomorrow. The star witness is to be, we believe, the au pair. And the defense may challenge her credibility. And also, we understand, they may be saying that Christine Banfield herself, the pediatric nurse,is the one that took out that account on the fetish Web site asking for an escort to come to the home.

KEILAR: All right, we will have to see. That would be very, very interesting. This is a case to watch.

Jean Casarez, thank you.

President Trump threatening to sideline Exxon from his plans for Venezuela's oil over a comment that the company's CEO made. We will have that next.

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