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Iran Prepares for the U.S. Economic D-Day Sanctions; Britain's New Prime Minister Meets Ukraine's President for Support Despite Russian Tensions. Aired 3-3:45a ET

Aired August 25, 2026 - 03:00   ET

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

[02:59:05]

POLO SANDOVAL, CNN ANCHOR AND CORRESPONDENT: Thank you so much for joining me. I'm Polo Sandoval, live in New York, and ahead here on "CNN Newsroom."

Iran says it's ready for new economic pressure that the U.S. is threatening. We'll have the latest on the Trump administration's escalating economic campaign.

And the trade dispute between the U.S. and Canada may be heating up again. I'll tell you why.

Plus, details on the British Prime Minister Andy Burnham's trip to Ukraine. And the Kyiv's allies are pledging as Russia steps up its attacks.

UNKNOWN (voice-over): Live from New York, this is "CNN Newsroom" with Polo Sandoval.

SANDOVAL: Iran's leadership is firing back at the U.S. after the White House's so-called economic D-Day against Tehran turned out to be a quote warning shot for its trading partners.

[03:00:02]

On Monday, the U.S. Treasury Secretary threatened new sanctions on countries refusing to cut economic ties with Tehran. Iran's top negotiator dismissed the announcements as bluster and says that Washington is not in a position to limit Iran's economic relations.

Secretary Scott Bessent did not name any country specifically, but experts are telling CNN that China, India, Turkey, Iraq, and also the United Arab Emirates could be the most at risk of U.S. action. CNN's Kevin Liptak had this question for Bessent.

(BEGIN VIDEO CLIP)

KEVIN LIPTAK, CNN SENIOR WHITE HOUSE REPORTER: You described this as an economic D-Day, but D-Day wasn't a threat of an invasion and the U.S. didn't give a timeline to Germany. So why not impose the sanctions today? SCOTT BESSENT, U.S. TREASURY SECRETARY: Well, we are giving everyone

the opportunity to remedy bad behavior. Why would I want to blow up the global financial system? We believe that it is important to level set and give people a cure period, but they should know that that will move very quickly and that we are serious.

(END VIDEO CLIP)

SANDOVAL: Our Kristen Holmes continues our coverage from the White House.

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KRISTEN HOLMES, CNN SENIOR WHITE HOUSE CORRESPONDENT: Treasury Secretary Scott Bessent's announcement of this economic D-Day is part of a larger strategy that we've been reporting on for the last several weeks, the shift from military action to economic action. And this is expected to take a lengthy amount of time.

And it doesn't seem as though they're going to stray from this kind of economic punishment anytime before the midterms. This is the strategy that they have now set on. It's kind of a strangulation.

Now, interestingly, when we heard Bessent talking, he was asked specifically about China, and he said no one was above the initiative. This is what else he had to say.

BESSENT: Teams from Treasury, state, and the U.S. military are now meeting with their global counterparts to tell them that the United States expects action. And let me be clear, any entity that facilitates money laundering on behalf of Iran will be removed from the U.S. dollar system. The clock just started ticking.

HOLMES: Now, in order for this to actually work, the United States is going to have to be increasingly hard on these countries that still do business with Iran, some of them being allies to the United States or countries that have worked with the United States, like Qatar or Turkey, for example.

The other part of this, and this is what skeptics are really pointing to, is whether or not this can work long-term, given what we have seen in the past four decades, which is the idea that internationally there have been tariffs and sanctions on Iran that have tried to cripple the economy for decades. And it has never really moved the needle in terms of Iran coming to the table or changing their stance on a nuclear program.

Now, this certainly would ramp up this economic effort. It would change it in the sense that it would be the United States doubling down on this effort, it would be kind of a chokehold. And there has been some success, if you talk to U.S. officials, particularly when they talk about the naval blockade of the Strait and how that has had a huge economic impact on Iran.

But again, right now it is unclear whether or not this is going to work and what this is going to look like long-term, because Scott Bessent didn't put any timelines on this and he didn't mention any countries by name.

Kristen Holmes, CNN, The White House.

(END VIDEO CLIP)

SADOVAL: CNN's Nada Bashir joining me live from London with more. So Nada, you just heard there from Kristen, there are so many unanswered questions still. But on the Iranian side of it all, we touched on the defiant tone. What else are you hearing from Tehran?

NADA BASHIR, CNN CORRESPONDENT: We certainly are seeing that defiant tone from the Iranian regime, from various Iranian officials who have now come out, many of them speaking to state media, characterizing this latest move by the Trump administration as a move that had been expected by the Iranian regime, something that the regime, according to officials, has long been preparing for.

But there's also been some questions within the Iranian regime as to how impactful this decision by the Trump administration will actually be in real terms, whether we will see those decisions, those sanctions and those threats put out by the Trump administration actually realized with regards to relations with other nations.

We've been hearing from Iran's parliamentary speaker, for example, who has been quite firm in his statement, saying that Iran is confident that those partners that they have long worked with in the past, despite sanctions that we have seen put in place, will not believe, in his words, the bluster of the Trump administration, that those relations will remain in place, that the U.S. is not in an economic position to have that level of influence on Iran's economic partners. Take a listen to these remarks.

[03:05:01]

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ALI MADANIZADEH, IRANIAN FINANCE MINISTER (through translator): They have made every effort during this period. They have tried to test the resolve of the Iranian people and the country's officials, and they have failed every time. Apparently, they have now decided to try another failure.

They have long been expecting these days, and were well aware of the plans they had. The government has a two-year plan, and is fully prepared, and has been prepared for these developments.

(END VIDEO CLIP)

BASHIR: That was Iran's finance minister speaking, and he did go on to say that Iran's response, in his words, will be, will not be purely defensive, will be purely defensive, that they will only defend themselves, but that the American and Trump administration should expect us to go on the offensive.

That is the quote from the finance minister, and we have also been hearing from Iran's security chief, saying that Iran will be working to neutralize the impact of those economic sanctions and economic measures taken against the Iranian regime, primarily through the Strait of Hormuz, from totally stopping the flow of oil through that key shipping route.

And of course, that has been the key stumbling block throughout mediation efforts and negotiations, and this is likely to have an impact on regional partners as well. So, some questions still remain as to how exactly this will be implemented, and how ready regional nations will be to take part in this, or rather to respect the measures President Trump has outlined in this latest move described as economic warfare against the Iranian regime.

And of course, this all comes as mediation efforts continue, despite, of course, the immense pressure we have seen being put on Iran, and both, as well, vice versa, on the Trump administration. We have been hearing, for example, from Pakistani officials who have been maintaining dialogue with the Iranian regime, presenting that dialogue as being positive, as seeing some progress, but whether that is enough to shift the needle, given these latest measures, that remains to be seen.

SANDOVAL: Yes, so much hope on that promise of possible dialogue. Nada Bashir, as always grateful for your reporting.

Let's now shift gears and talk a bit more about the other situation that's unfolding right now, specifically with President Donald Trump as he escalates his trade war with Canada, with promises of more economic pain. After last week's negotiations fell apart, he imposed 50 percent tariffs on $20 billion worth of Canadian goods.

Well, now he is warning that if Canadian leaders do not, in his words, fall in line, then the consequences could be far worse, he said. Canada promising to match the Trump tariffs dollar-for-dollar, but Prime Minister Mark Carney says that his country is willing to return to talks if the Trump administration has, quote, "the right attitude."

The Prime Minister blaming the collapsed negotiations on last-minutes and, what he calls, unfair trade demands from the U.S., and President Trump sharpened his rhetoric in this Truth Social post, writing that Canada is, quote, among the worst nations in the world to deal with, and that the U.S. doesn't need Canada, but that they need the United States.

CNN's Michael Yoshida has the latest on these growing tensions.

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MICHAEL YOSHIDA, CNN CORRESPONDENT (voice-over): The cross-border trade war is escalating.

MARK CARNEY, CANADIAN PRIME MINISTER: We cannot accept what they've offered, and we will not give what they've asked.

YOSHIDA (voice-over): In a Monday Truth Social post, President Donald Trump threatened to double tariffs on Canadian cars and car parts to 50 percent come January 1st, adding to the 50 percent tariffs on roughly $20 billion worth of Canadian goods announced over the weekend.

UNKNOWN: This is something where we don't actually expect a huge impact.

YOSHIDA (voice-over): Now Canada is retaliating with its own dollar- for-dollar tariffs, starting September 8th, and those could have an impact.

DAVID EBY, BRITISH COLUMBIA, CANADA PREMIER: What it actually means for Americans is a new 50 percent tax. It is a bizarre policy for Americans. It's going to hurt them.

YOSHIDA (voice-over): Things like paper products, dairy, alcoholic beverages, and lumber could all get more expensive.

RANA FOROOHAR, ASSOCIATE EDITOR, "FINANCIAL TIMES": Some of the products that come from Canada, like lumber, for example, very important in the U.S. building trades. Energy.

UNKNOWN: These are things that Americans are already feeling a pinch on.

YOSHIDA (voice-over): The Trump administration argues this is necessary due to a trade imbalance.

We're actually worried about our, you know, our small businesses to make sure they get the kind of access they need.

YOSHIDA (voice-over): But the trade war, adding salt to the wound for businesses already stressed by the war with Iran, that has driven up energy and transportation costs. With less room to absorb another hit, new tariff costs will likely land on consumers.

In Washington, I'm Michael Yoshida.

(END VIDEOTAPE)

SANDOVAL: Ukraine is deepening its alliance with the Coalition of the Willing as the country marks 35 years of independence. Leaders, including the British Prime Minister, gathered in Kyiv, promising to boost Ukraine's air defenses and begin full-scale military exercises in October.

[03:10:04]

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ANDY BURNHAM, BRITISH PRIME MINISTER: I am determined that we will work together to deliver the support you need, Mr. President, stronger than ever. That means not just air defense, but stopping Russia launching their missiles in the first place, with sanctions that cut off their military supply chain.

(END VIDEO CLIP)

SANDOVAL: That's British Prime Minister Andy Burnham. He co-chaired the meeting in Kyiv as part of his first overseas visit since taking office just last month. While there, he also announced that the U.K. is granting Ukraine access to classified storm shadow cruise missile technology.

CNN's Nic Robertson reports on the deepening tensions between London and Moscow.

(BEGIN VIDEOTAPE)

NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: This comes at a time, and we'll think back to the day, the 20th of July, not so long ago, when Andy Burnham was stepping over the threshold in Downing Street, becoming Prime Minister.

That was the day a Russian naval frigate in the English Channel fired warning shots near a pensioner couple who were sailing their yacht in the area. The very next day, the Russian ambassador to the U.K. withdrew from the country.

And there's been a sort of a drumbeat coming from Russian officials warning Britain of consequences of supporting Ukraine. And Burnham here, in his first overseas trip, remembering his first international leader to host in London was President Zelenskyy of Ukraine, going to Ukraine to make very clear he's not going to be intimidated by Putin.

He sees the way to bring the war to an end in Ukraine, to put economic pressure and military pressure on Russia. One of those missile components that he's giving the blueprints for, they're designed to have longer range, highly accurate cruise missiles that can bust through bunkers, tear through ammunition depots, pushing Russia effectively further away from the front lines in the war of Ukraine.

So this is an effort combined with Europeans. And that was the point of having this coalition of the willing conference call there while he was in Kyiv today as well.

(END VIDEOTAPE)

SANDOVAL: All right, thanks to Nic Robertson.

And meanwhile, the U.S. is calling on Russia and Ukraine to resume peace talk negotiations. The request came during the latest U.N. Security Council meeting. Its agency officials warned of mounting civilian casualties linked to drone warfare.

The U.N.'s aid chief visited southern Ukraine last week, describing some parts of the region as a dystopian landscape of kill zones. Russia's U.N. ambassador rejected any ceasefire that would allow Kyiv to regroup and rearm. Still, though, a U.S. representative insisted that America is ready to help end the fighting.

(BEGIN VIDEO CLIP)

DAN NEGREA, U.S. REPRESENTATIVE, U.N. ECONOMIC AND SOCIAL COUNCIL: It is senseless to continue to spill blood of innocent civilians when there is no military solution to this war. Russia and Ukraine must return to the negotiating table. The United States will play whatever constructive role part it can to facilitate talks between Moscow and Kyiv to achieve this outcome.

(END VIDEO CLIP)

SANDOVAL: And much more on the way here on "CNN Newsroom," including the U.S. Supreme Court issuing a critical ruling on mail-in voting ahead of the midterm elections. And several controversial arrests by ICE have put Donald Trump's immigration crackdown back in the spotlight. Let's take a closer look at the latest actions.

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[03:15:00]

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SANDOVAL: Well a little more than two months before the high-stakes midterm elections, the U.S. Supreme Court has given Donald Trump an early win in his effort to restrict mail-in voting. The Court's conservative majority upheld part of the President's executive order from back in March that was challenged by states where Democrats are in charge.

The order basically gives the Homeland Security Department and the U.S. Postal Service unprecedented new roles in the running of elections. DHS would have to complete state-specific voter eligibility lists and the Postal Service would impose new mandates on states that want to send ballots through the mail.

The President has long baselessly railed against mail-in voting, calling it corrupt and fraudulent, even though he does it himself.

These are some major changes, and it's still unclear exactly how long all of this will take to implement. But it is clear that they're injecting some confusion, also some uncertainty, into the voting process.

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ELIE HONIG, CNN SENIOR LEGAL ANALYST: The practicalities are a big issue here. I mean, we have, what, 70 days between now and the midterms. It's going to be really difficult a for that rulemaking process that was just alluded to to go through completion by the postal service, and then for litigation to make its way through the courts in time for the midterms.

So even though this is a big win for the Trump administration, I think it's unlikely that the full thrust of this executive order, if any of it gets implemented between now and November. But certainly the legal battle is not over.

First of all, there could be challenges to that rule if and when the U.S. Postal Service promulgates it. And then these cases can go back up the courts if, in fact, the states can show there is harm. If the states can show that their function is being infringed on, if the states can show that people are being wrongly excluded from voting lists, then this can come back.

[03:20:05]

This is not necessarily the final word. The Supreme Court was explicit about that. But the Supreme Court said, for now, the states have not been able to show the type of harm that's going to make us come in and pause this.

(END VIDEO CLIP)

SANDOVAL: And the Trump administration is trying a new approach to raise the application fee for H-1B visas. Previously, that fee was roughly $3,000.

But the newly proposed price tag is sitting now at just over $103,000. Some 65,000 H-1B visas are available annually, offering foreign specialists with college degrees a renewable three-year residency. And there's also an additional 20,000 visas reserved for those with advanced degrees.

But the Trump administration is arguing that the program is overused and that it prevents companies from hiring Americans, and this comes just months after a district judge voided President Trump's executive order seeking to impose a similar $100,000 fee.

ICE arrests all rattling families across the U.S. and they're casting more scrutiny on the forceful tactics that the Trump administration is using in some communities throughout the country as it carries out its immigration agenda, which is a top priority for President Trump.

And as CNN's Rafael Romo reports, family members are saying that some of those detained actually have legal status to be in the United States.

(BEGIN VIDEOTAPE)

UNKNOWN (translated): Why are they treating her like this? For God's sake, what has she done?

RAFAEL ROMO, CNN U.S. NATIONAL CORRESPONDENT: Sheriff's deputies in Polk County, Florida, handcuffed a woman while her daughter lies on a hospital bed, crying hysterically while trying to hold on to her mother.

UNKNOWN (translated): Please, I beg you, please.

ROMO (voice-over): The mother and her 19-year-old daughter were detained at a hospital where they were both being treated for injuries suffered in a car crash. DHS says that two women overstayed their visas, but in a GoFundMe post, family members say both mother and daughter had legal status in the United States.

The mother, Grace Calero-Cabanilla, relatives say, has a pending asylum case and a work permit, while her 19-year-old daughter, Juliana Carriel Calero, has a visa valid through 2030. ROMO: These arrests highlight the aggressive tactics being used by

Immigration and Customs Enforcement during the current administration, going to lengths they rarely went to before, detaining immigrants inside courthouses and hospitals, and even taking into custody the father of a U.S. sailor currently deployed in a war zone.

ROMO (voice-over): Joshua Aviles, who's currently entering his ninth month of active duty with the U.S. Navy on the USS Abraham Lincoln, says his father, Luis Manuel Aviles, was detained by ICE over the weekend, even though his son says his father has a driver's license, social security card and work permit.

"This is heartbreaking for me," the sailor said in a post on Facebook. "I don't know how I can mentally continue working 12-plus-hour days knowing that my dad is somewhere, possibly being treated like a criminal. My dad's only 'crime' was coming to this country to give my siblings and me a better life."

The Department of Homeland Security said in a statement his father will remain in custody while the government seeks to deport the Nicaraguan native.

Another ICE detention that has gone viral, a father and young son who were detained on the way to a soccer match in Texas on August 16th. The five-year-old boy, identified by his family as Liam Tadeo, appears to be crying as he tried to hold the hand of his handcuffed father, Victor Martinez Nieto, from Mexico, being escorted to an unmarked vehicle.

DHS said parents have a choice if they want to be removed with their children or ICE will place the children with a safe person the parent designates.

UNKNOWN: And Liam should be starting kindergarten this week, but instead he's sitting in a trailer prison right now in Dilley, Texas.

ROMO: The Trump administration is looking to increase the speed of its deportations and is casting a wider net about who can be arrested. That includes meeting the administration's goal of around 2000 arrests every day.

Rafael Romo, CNN, Atlanta.

(END VIDEOTAPE)

SANDOVAL: Still ahead on "CNN Newsroom," the U.S. is now looking to flex the power of the dollar in its economic war on Iran and its trading partners. Ahead, a former U.S. Treasury secretary weighs in on that and much more.

And a dramatic day in the trial of Massachusetts' mother, Lindsay Clancy, who was accused of murdering her three young children. After the break, the controversial testimony that prompted the defense to request a mistrial.

(COMMERCIAL BREAK) [03:25:00]

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SANDOVAL: Welcome back. I'm Polo Sandoval, in New York. And let's take a look at today's top stories.

U.S. President Donald Trump threatening to impose more tariffs on Canada if Canadian leaders do not, quote, "fall in line." This latest escalation of the trade war comes just days after negotiations fell apart and after Canada vowed to impose retaliatory tariffs on the U.S. Canadian officials will speak more about their response later today.

[03:30:01]

Well the White House is calling the latest Supreme Court ruling on President Trump's mail-in voting order, quote, "a major win for the security of American elections." But the decision adding new uncertainty to the November midterms. The President's executive order would give the Department of Homeland Security and the U.S. Postal Service new powers in deciding who gets to mail-in vote.

Iran is defiant as the U.S. announces that it will sanction countries with economic ties with Tehran. The U.S. Treasury secretary also said, quote, "any entity that facilitates money laundering on behalf of Iran will be removed from the U.S. dollar system."

CNN's Richard Quest spoke with former U.S. Treasury Secretary Janet Yellen. He asked her whether expanding the economic warfare against Iran and its trading partners will give the White House what it wants. And here's what she told Richard.

(BEGIN VIDEO CLIP)

JANET YELLEN, FORMER U.S. TREASURY SECRETARY: It can be difficult, but I think it makes sense to clamp down and to try to use all of Treasury's tools.

RICHARD QUEST, CNN BUSINESS EDITOR-AT-LARGE, AND "QUEST MEANS BUSINESS" ANCHOR: And even if this, it means and involves, as it invariably will, arguably, you know, annoying, frustrating allies, whether it be, say, for example, Turkey or indeed Pakistan or any of the other countries, that somehow manage to still do business in one shape, form, even if several positions removed from Iran, because ultimately it is the dollar where everything finally ends up, and that's the strong part.

YELLEN: Yes, and the fact that the dollar is used for so much of trade means that Treasury has a great deal of scope to threaten sanctions, to use secondary sanctions. There can be costs involved in doing that, that the United States has to weigh very carefully foreign policy costs, and as I say, some practical limits to what can be accomplished.

(END VIDEO CLIP) SANDOVAL: A U.S. airman is facing criminal charges for criticizing President Trump. Major Jason Watson has been arrested twice now, including once on the steps of the U.S. Capitol while calling for Trump's impeachment. He's charged with making contemptuous remarks about the President, disobeying orders, and conduct unbecoming of an officer.

Watson was arrested again last week after a CNN interview, where he called the president a failure who is engaged in rampant corruption and killing Americans. His attorney says that Watson believes in the Constitution and stands by his actions.

A judge has denied a mistrial request from Lindsay Clancy's defense after one of the prosecution's medical witnesses referenced her Catholic faith. Testifying on Zoom, a forensic psychologist said he asked Clancy whether she knew suicide was considered a mortal sin.

He was referring to Clancy's suicide attempt, which left her partially paralyzed. She jumped from a window after killing her three young children. Clancy's defense says that she was suffering from postpartum psychosis and was not in control of her actions at the time.

The judge instructed jurors to disregard the religious testimony, but denied the defense's request for a mistrial. The prosecution's rebuttal case is expected to wrap up on Tuesday, with closing arguments likely to start on Wednesday.

The long-awaited trial of the latest man accused in the deadly bombing over Lockerbie, Scotland, has been delayed. Jury selection was supposed to start on Wednesday, but lawyers for the Libyan man charged with building the bomb say there is newly discovered evidence that must be investigated, but did not reveal what it is.

While the defendant was taken into U.S. custody in 2022 and is pleaded not guilty, Pan Am Flight 103 exploded over Scotland in 1988, killing all 270 people on board and 11 people on the ground who were crushed by the wreckage. It remains the U.K.'s deadliest terror attack.

Coming up next on "CNN Newsroom," OpenAI is introducing what it says is a safer chatbot for teens. Parents will be able to manage their child's account. We'll have some details on this new ChatGPT for teens.

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[03:35:00]

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SANDOVAL: Welcome back. Here are your business headlines.

Aerospace company Boeing has a new $131 billion contract with the U.S. Defense Department. It includes production, upgrades and maintenance for F-15 fighter aircraft as part of the Eagle Crest program. The contract also covers foreign military sales to Japan, Israel, Saudi Arabia and a number of other countries. A New York City non-profit suing Mayor Zohran Mamdani and the city in

an effort to stop plans to open five government-owned grocery stores.

[03:40:04]

The group represents small business owners, it's alleging that Mamdani's plan violates the civil rights of smaller minority-owned grocery stores which can't afford to match discounts offered by city- run establishments. Mamdani says that he's confident in the legality of his plan.

France and Saudi Arabia are collaborating to build a $7 billion theme park based on "Dragon Ball Z." The two countries signed an agreement to build that park near Paris. French officials say that President Emmanuel Macron and Saudi Crown Prince Mohammed bin Salman discovered a shared enthusiasm for the series in 2025. Construction is expected to take several years, and French officials say that the project will create some 22,000 jobs.

As social media and A.I. companies face active lawsuits over child safety concerns, OpenAI now launching a new ChatGPT exclusively for teens. The chatbot will have built-in age-appropriate tools and safeguards for users under 18.

Jenn Sullivan tells us what parents need to know about the new features.

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JENN SULLIVAN, CNN CONSUMER REPORTER (voice-over): Artificial intelligence chatbots can respond to any type of question. So it's no wonder 70 percent of kids 13 to 17 say they're using A.I. tools to help with homework, according to a recent survey from Common Sense Media.

So how can parents ensure their kids are using it safely?

LAUREN JONAS, OPENAI HEAD OF YOUTH WELL-BEING AND FAMILIES: Our safety work is never done.

SULLIVAN (voice-over): Lauren Jonas is the head of youth well-being and families at OpenAI, the company behind ChatGPT. OpenAI recently rolled out its new chat GPT for teens feature aimed at keeping teens safe. Users who identify at sign up that they are under 18 will automatically be placed in protective settings.

When it comes to A.I. sites, ChatGPT is the most popular among teens. More than half say they've used it, according to a Pew Research Center study published in December.

JONAS: The goal is for this to be a learning tool for teens.

SULLIVAN (voice-over): The new features include things like suggestions for minors to take breaks after they've been active for 90 minutes within a three-hour window. Parents and teens can set quiet hours where ChatGPT is unavailable. There's also a study hours mode that gives directions, not fast answers.

JONAS: This is 24/7, 365, a continuous effort to make sure that we're getting teens the support that they need in the moments that they need it.

SULLIVAN (voice-over): OpenAI has faced scrutiny over concerns that ChatGPT can harm young people, including lawsuits from families who allege that ChatGPT contributed to their child's suicide. The company has pushed back on those allegations.

For Consumer Watch, I'm Jenn Sullivan.

(END VIDEOTAPE)

SANDOVAL: Thank you so much for watching, I'm Polo Sandoval in New York. "World Sport" is up next, and I'll be right back with you at the top of the next hour.

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