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Trump Says Reflecting Pool Renovation Will Cost Over 10x Estimate; Mortgage Rates Climb to Highest in Nine Months; Gas Prices Hit New Wartime High Ahead of Memorial Day; Acting Ag Faces Major GOP Pushback on $1.8 Billion Compensation Fund; U.K. Releases Files on Ex- prince Andrew's Trade Envoy Role; House Oversight Committee Interviews Longtime Epstein Assistant; U.S. Intel Finds Iran Rebuilding Military Faster Than Expected. Aired 2-2:30p ET

Aired May 21, 2026 - 14:00   ET

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

[14:00:00]

SUNLEN SERFATY, CNN WASHINGTON CORRESPONDENT: -- flag blue, those costs have grown, the Department of Interior admits, because the president wants to really accelerate the timeline for it to be completed in line with the nation's 250th anniversary celebration in July. So they have had to really power through that project. And coming in the next hour in the 2 p.m. Eastern hour, there is a hearing here in federal court here in D.C. where they are being challenged over this project. We could potentially see this project today being stopped mid paint job.

BRIANNA KEILAR, CNN CO-ANCHOR OF "CNN NEWS CENTRAL": The forecast isn't great this week either, I'll tell you for the rain. It's great for the plants, not really for painting the reflecting pool. Sunlen Serfaty, thank you so much.

A new hour of "CNN News Central" starts right now.

BORIS SANCHEZ, CNN CO-ANCHOR OF "CNN NEWS CENTRAL": The cost of the conflict, market turmoil fueled by the Iran War sending U.S. mortgage rates to their highest point in months, while gas prices hit a new wartime high ahead of the holiday weekend.

Plus, growing bipartisan skepticism over the DOJ's so-called Anti- Weaponization Fund, critics calling it a slush fund as some convicted capital rioters and prominent election deniers tell CNN that this is long overdue.

And later, criminal charges dismissed against a former assistant school principal three years after a first grader brought a gun to school and shot his teacher in the chest. We're following these major developing stories and many more, all coming in right here to "CNN News Central."

Americans' wallets are getting walloped, two more counts of ugly economic news today, mortgage rates just hitting the highest level we've seen in nine months and as we gear up for the busy summer travel season, gas prices are higher than we've already seen in almost four years. Experts say they could get worse too with the war in Iran and the ongoing closure of the Strait of Hormuz de-stabilizing global oil markets.

CNN Business Senior Reporter, David Goldman is here to break it down for us. David, let's start with mortgage rates. How high are we talking?

DAVID GOLDMAN, CNN BUSINESS SENIOR REPORTER: Yeah, 6.51 percent, that is, as you mentioned, the highest in nine months and the amount that it jumped over the past week was the largest jump that we've seen in over a year. And so what's going on here? Why is this happening? Well, the war in Iran is causing two things. It's causing inflation because of those gas prices that we'll talk about in a second and it is a huge expense that the government needs to pay for.

And you can think of the bond market like a scale, right, where it is -- when you weigh down the price, the yield goes higher. What is based on that yield? Mortgage rates, consumer loans, credit cards, auto loans, things like that. And so, what we're seeing is this imbalance. We've seen the bond market plummet in the last couple weeks, especially the last week, as we consider that the war will just continue and continue and continue. That's what investors think is going to happen. That's what is causing those mortgage rates to go higher, Boris.

SANCHEZ: And as the war continues, the Strait of Hormuz not seeing the traffic that it usually does, therefore, oil prices go higher. How high are we talking in the United States?

GOLDMAN: Well, you know, oil prices have maintained their level above $100 a barrel and when you think about what was happening before the war, we had $60 oil.

(LAUGH)

GOLDMAN: That was why we had $3 gas. With $100, $110 even just a few days ago, now we're looking at $4.56 which is a wartime high and every single U.S. state is now averaging more than $4 a gallon. It's going to be a painful Memorial Day for folks who are taking a road trip. Look at that, Indiana, Mississippi; these are not states that you think about with really high gas prices. Now, even folks in the middle of the country are contending with very, very difficult road trips.

SANCHEZ: Yeah. It does not look like a good time for travelers this summer. David Goldman, thank you so much for that update. Brianna?

KEILAR: The government's new Anti-Weaponization Fund is now so controversial it has derailed the Senate Republican agenda. For 90 minutes today, Acting Attorney General, Todd Blanche, faced major resistance as he met with Senate Republicans about this nearly $2 billion fund which would use taxpayer money to compensate people who believe they were unfairly prosecuted by the Justice Department.

That could include the rioters who were convicted and later pardoned for their participation in the January 6th attack on the Capitol. Some Republicans are warning that this could actually get in the way of major immigration enforcement legislation. And now, they have gone home for the Memorial Holiday recess. GOP Senator, Thom Tillis calling this fund "stupid on stilts."

[14:05:00]

(BEGIN VIDEO CLIP)

SEN. THOM TILLIS, (R-NC): These people don't deserve restitution. They -- many of them deserve to be in prison, some of them deserve the pardon because they were over prosecuted. But this is -- I mean this is just stupid on stilts. I mean this is beyond the pale. This is not good for my colleagues. There's no one positive thing that could be spun out of this between now and November. This is bad policy. It's bad timing and it's bad politics.

(END VIDEO CLIP)

KEILAR: Let's bring in CNN Chief Legal Affairs Correspondent, Paula Reid. And Paula, you actually sat down with the Acting Attorney General, he was very much defending this fund.

PAULA REID, CNN CHIEF LEGAL AFFAIRS CORRESPONDENT: He was and it was good to have the opportunity to talk with him because when they announced this $1.8 billion fund on Monday, it didn't come with a lot of details or specifics about exactly how they would prevent this from becoming a slush fund, not only for allies of the president, but also for everyone because we know nobody who's ever been investigated at state or federal level thought it was fair, right?

How are you going to protect taxpayer resources, make sure they go to the appropriate people? So this was an opportunity to sit down, ask him questions. The biggest question is why should taxpayers get behind this? Let's take a listen to what he said.

(BEGIN VIDEO CLIP)

REID: People are struggling to afford gas and if they see this $1.8 billion fund, people already making multi-million dollar claims and they're just concerned, right? Nobody who has been investigated by this Justice Department in U.S. history thought it was fair, thought it was great. How do you prevent this from becoming a feeding frenzy for taxpayer funds?

TODD BLANCHE, ACTING U.S. ATTORNEY GENERAL: This has nothing to do with the cost of gas, it just doesn't. I mean, look, our fraud are -- the work we're doing in the fraud space has already saved hundreds and hundreds of millions of dollars to taxpayers, OK? So this isn't a, why are you spending money on this one, gas is expensive?

This is a very often used way to settle claims, OK? And yes, it's unique. I agree that it's unique and the fact that it's a combat weaponization is not something that's been done before. But conceptually, the legal framework of what we're doing is, again, it's been done before and there's the federal government settles cases every single day constantly.

(END VIDEO CLIP) REID: Look, as far as we understand from talking to sources and experts, this is legal. It is, as he noted, it is certainly unique in terms of how it is structured, but the biggest thing is we don't understand who is going to be on this panel that will vet claims. These members have not been announced yet. That's going to be a big deal.

And Todd or whoever the Attorney General is at that point, they will have to do that in the next month or so. And then once we know the members, apparently that's when we're going to get more details about how they're going to vet these claims. But right now, he's asking people to trust the Justice Department that these unnamed five people will be good stewards of this enormous pot of taxpayer money.

KEILAR: But as people look at this to see whether it's unique or not, he's saying it's often used. He's also admitting it's unique, never been done before, also done before. Did I get that right?

REID: Yeah. You did and it was a lengthy interview. We did go back at him a few times and just, this was an opportunity for him to clarify because there is a lot of confusion. I think what he is saying is that this mechanism for putting money aside and then vetting claims for people who have been wronged, this is legal. This is something that they will point to the Obama administration having done, but with that, the difference was there was a judge who had signed off on it and it was also about racial claims related to the Department of Agriculture.

So again, the messaging here has not been as clear and convincing as maybe it should have been, if they want to sell this not only to the American people. But right now, they got to sell it to their own party. So this is one of the biggest controversies this Justice Department has faced in quite a while.

KEILAR: Yeah. No judge involved here, should be clear about that.

REID: No judge.

KEILAR: Paula Reid, thank you so much. Still to come, some new details about former Prince Andrew's controversial role as the U.K.'s trade envoy. What the British government uncovered in newly released files and how this is tied to Queen Elizabeth II.

Plus, what's next after DOJ's historic indictment of Cuba's former President, Raul Castro. We talked to a lawmaker who is the daughter of Cuban exiles, straight ahead. And a former assistant principal in Virginia is now off the hook for criminal charges in a horrific school shooting involving a six-year-old and his teacher. We have that and much more coming up on "CNN News Central."

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KEILAR: Newly released documents show it was Queen Elizabeth's wish to have her son, Andrew Mountbatten-Windsor, then Prince Andrew, appointed as U.K. trade envoy. The prince, then prince, took on the role in 2001. A minister today saying the British government found no evidence that he was vetted prior to the appointment. He stepped down more than a decade later over his ties to convicted sex offender, Jeffrey Epstein.

Mountbatten-Windsor was arrested earlier this year on suspicion of misconduct in public office following fallout from the release of the Epstein files. We're joined now by Arick Fudali, an attorney who represents 11 Epstein accusers. Arick, thanks for coming back on the program.

I wonder how, as you're looking at this reporting, how the decision is aging, that desire of the Queen's to have Andrew in this role and his apparent placement in it without vetting.

[14:15:00]

ARICK FUDALI, ATTORNEY REPRESENTING 11 EPSTEIN ACCUSERS: Well, it's certainly not aging well given what we know about Prince Andrew, or former Prince Andrew and Jeffrey Epstein's relationship, to sort of frame it some way, right? We absolutely know that Prince Andrew and Jeffrey Epstein were very closely aligned, spent a lot of time together. And of course, there's been very salacious allegations against Prince Andrew, former Prince Andrew, for which he actually, the reporting is that he actually settled the case for a substantial amount of money. So it has certainly not aged well.

And really, the relationship between former Prince Andrew and Jeffrey Epstein is something that I think continues to need to be investigated. I appreciate that there's been some level of perhaps accountability in Great Britain with his brief arrest, but I still think that there needs to be a lot more investigation, tough questions, and looking into what former Prince Andrew did along the side with Jeffrey Epstein and what actually their relationship entailed.

KEILAR: Today, the House Oversight Committee is interviewing Sarah Kellen, a longtime Epstein assistant, a potential co-conspirator. That's how Florida federal prosecutors considered her as they investigated Epstein almost 20 years ago. But Chairman Comer said they're split, the committee is, on whether to treat her as a victim or a perpetrator. How are you looking at this?

FUDALI: Split as well. I think that's a fair assessment of it. This is a very, very complicated case. Now, I obviously cannot speak to the specific details of Ms. Kellen's relationship or what she actually did alongside Jeffrey Epstein.

What I can say generally, however, is that Jeffrey Epstein was a master manipulator. And he was very adept and very good at manipulating those very people who he had power over and also other powerful people to doing whatever he wanted. Now, again, Ms. Kellen, of course, was an adult and she can make her own -- she has to be accountable for her own decisions.

But I can say generally, that Jeffrey Epstein did victimize a lot of women and did also manipulate a lot of those victims into helping him facilitate finding other victims. So yeah, I agree that this is sort of very split. It is a very complicated case as to how this interview is approached.

What I will say is not complicated is that she may be a source of information. She is someone who was very close to Jeffrey Epstein for a long period of time, especially after 2008, the sweetheart deal, she continued to be associated with Jeffrey Epstein. And I think it's very important to learn what she saw and perhaps even who she saw closely aligned with Jeffrey Epstein after 2008.

Because remember, after 2008, despite the fact that he got a very sweetheart deal, Jeffrey Epstein was a registered sex offender and that was public knowledge. So I hope the committee uses this or uses her interview as a means of getting actual information about who continued to closely align themselves, closely associate with and hopefully -- perhaps even closely facilitate a registered public sex offender.

KEILAR: Comer also reinforced that former Attorney General, Pam Bondi, will be in for an interview next week. There is not going to be -- there will be a transcript. There's not going to be video of this. Does this interview have utility for victims?

FUDALI: Optimistically, I'd love to say yes. Unfortunately, given the way basically every single thing, every single aspect of this has been handled by the DOJ, by this administration, I don't have high hopes. Remember, last time, Pam Bondi was in front of Congress as it relates to Jeffrey Epstein, she basically put on like an hour-long temper tantrum with zero information where she just had these rehearsed insults to hurl back at the Congress persons who were asking her questions. She couldn't even look at the survivors in the eye, couldn't even pretend to have even a shred of empathy for what the survivors and the victims of Jeffrey Epstein have been through.

So I actually intend to probably be in D.C. for this hearing -- or for this interview. I think it should be open. I think it should be under oath. I think it should be videotaped. I think the public should be able to see Pam Bondi answer these questions. Unfortunately, that's not where we're going to get.

I will take what we can get and I at least think an interview with her, a transcribed interview with her is better than nothing, but it's not nearly enough.

KEILAR: Arick Fudali, thank you so much for being with us. We appreciate it.

FUDALI: Thank you.

KEILAR: Coming up, tensions rising between President Trump and Israeli Prime Minister, Benjamin Netanyahu, as the two leaders clash over the next steps in the war with Iran. We are live with an update from Tel Aviv, next.

(COMMERCIAL BREAK) [14:24:07]

SANCHEZ: The U.S. is now six weeks into the ceasefire with Iran and in that time, CNN has learned that Tehran began rebuilding key parts of its military, an effort that's happening at a faster pace than anticipated. One source revealing that U.S. intelligence indicates Iran could fully restore its drone attack capabilities in as soon as six months.

Iran is also said to be quickly replicating missile sites, launchers and production capacity for key weapons systems. Let's go live now to Tel Aviv with CNN's Jeremy Diamond. Jeremy, you have some new reporting on how Israeli Prime Minister, Netanyahu has been pressing Trump to resume strikes on Iran.

JEREMY DIAMOND, CNN JERUSALEM CORRESPONDENT: Yeah, that's exactly right, Boris. And in large part, that has to do with the fact that the prime minister went into this week believing that the United States was preparing to resume attacks against Iran, which meant that Israel could do so as well. That was where things left off on Sunday when Prime Minister Netanyahu and Trump first spoke earlier this week.

[14:25:00]

But then on Tuesday, President Trump made it about face on that and when they got back on the phone, it seems like some of the tensions over that about face boiled over in this conversation. The Israeli prime minister telling President Trump that he believes that delaying this attack on Iran is a mistake, urging him to make another about face, basically, and decide to move forward with those planned attacks against Iran, and basically urging President Trump to resume military action.

We've heard the prime minister publicly before say that he doesn't believe that all the military objectives of this war have been accomplished, but he's been very cautious in public not to kind of overtly egg the president on and cheerlead for war. But an Israeli source has also told me that following this conversation, a number of Israeli officials were very unhappy, very frustrated with President Trump's decision to call off those strikes, and that there has been a strong desire in the upper echelons of Israel's government to resume military action against Iran.

There is also, I'm told, concern that President Trump could potentially make a bad deal with Iran, making a deal that wouldn't achieve all of the objectives that Israel has sought out, such as removing all of those quantities of highly enriched uranium from Iran and preventing Iran from further enriching any additional uranium going forward.

But we heard President Trump just yesterday say that he basically believes that Prime Minister Netanyahu will "do whatever I want him to do." The Israeli prime minister certainly doesn't see the relationship that way, but at the same time, he understands that this war can only resume with the approval and the consent of President Trump. The United States is the senior partner in the relationship, as the prime minister has told me before.

Now, Israel certainly has been concerned that as this ceasefire is underway, Iran is rebuilding its military capacities, and so this new intel report will certainly add to those Israeli concerns that the longer this ceasefire goes on, the longer Iran's diplomatic foot- dragging, as the Israelis see it, goes on, the higher Iran's capabilities will be should war resume. Boris?

SANCHEZ: Jeremy Diamond, thank you so much for the update from Tel Aviv.

Still to come, the Trump administration ramping up pressure on Cuba following the historic indictment of the country's former leader, Raul Castro. But what does this mean for the people of Cuba? We're going to discuss with a lawmaker who's the daughter of Cuban exiles when we come back.

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