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Quest Means Business
FBI Hacks Terrorist's iPhone Without Apple; U.S. Government Drops Case Against Apple; FBI Hacks Terrorist's iPhone without Apple; FBI Investigating Hack At U.S. Hospital Chain; Trump's Campaign Chief Charged with Battery; Trump's Campaign Manager Accused of Grabbing Journalist; Sanders Looks to Close Gap with Clinton; Oddest Job Interview Questions
Aired March 29, 2016 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[16:00:00]
RICHARD QUEST, HOST: Start them young. And they'll learn what to do. St. Jude's Children's Research Hospital ringing the closing bell. As the girl
pushes the bell, and the gentleman afterwards, go on, sir, you can do it. There, well done! We've seen far weaker ones than that on the stock
exchange.
Trading is over, the market, ladies and gentlemen, is up 100 points and it all happened on Tuesday, March the 29th.
(BEGIN VIDEO CLIP)
QUEST: Tonight, Rousseff on the ropes. Brazil's President watches her coalition crumble. The passenger jet that's hijacked in Egypt by a man with
a fake suicide belt. And the FBI said it's cracked the terrorist's iPhone. I'll ask John McAfee if he was the man behind it.
(END VIDEO CLIP)
QUEST: We have an hour together. It will be busy. I'm Richard Quest. I mean business.
Good evening. Tonight, the prospect of impeachment grows ever closer for the Brazilian President Dilma Rousseff. The country's largest party has
voted to leave the governing coalition. It follows a long-running corruption scandal implicating the highest office in Brazil. It is a
corruption scandal that seems to be getting ever deeper and ever closer to the presidency.
Now, Mrs. Rousseff's dwindling chances of staying in power has cause. This is fascinating because usually political instability causes markets to fall
but the prospect of Dilma Rousseff losing actually or being pushed out of office is actually raising the market.
(BEGIN VIDEO CLIP)
QUEST: The Bovespa in San Paola goes up 266 points over 51,000. And as it's been happening, of course, if you look at the intraday, this is you can
see, the news of the day, the announcement that they're leaving the coalition, suddenly the market goes much and sharply higher. Over the last
year, and, again, it's the prospect of impeachment, the prospect of change in government. Largely since February when all this took on a new
seriousness that has sent the market up the best part of 18% in the last few weeks.
Dilma Rousseff has been blamed for Brazil's floundering economy which as you will be aware, is stuck in the worst recession that it's been in in
more than a quarter of a century. Our correspondent is Paula Newton. She is in Rio for us tonight.
(END VIDEO CLIP)
QUEST: Let's go to -- let's dissect this point by point. First of all, who announced they were leaving what?
PAULA NEWTON, CNN CORRESPONDENT: It is certainly the democratic movement party here, it is the largest political party here in Brazil. Why is this
significant? By pulling out, we are now at - count them seven ministers who have now resigned. Basically, that government has collapsed. Dilma Rousseff
must now turn to the rest of the people in that coalition but she just doesn't have the votes, Richard.
(BEGIN VIDEO CLIP)
NEWTON: If she doesn't have the votes it means when they come to vote for her impeachment, she will lose. What does that mean? It means the caretaker
government will then take over while she continues to fight that impeachment battle. And it is important right now Richard, to make a
distinction, she is not implicated in the corruption scandal. She -- the coalition, the opposition are saying, look, she did not handle the books in
this country legally and that's why she's being impeached.
At the same time, the cloud of the Lava Jato the Carwash corruption investigation hangs over this entire country. And, Richard, everyone here
knows that what they're about to witness is a huge political clash.
(END VIDEO CLIP)
QUEST: Now, on this point, because the accusation against Dilma Rousseff is that she basically fudged the books as regards the budget deficit when
reporting the national accounts to the congress, as I understand it. Now, in that situation, what's the latest thinking in Brasilia, that she will
lose an impeachment vote or the vote to impeach her?
NEWTON: Definitely. If you talk to anyone in the opposition, they say that, look, she just doesn't have the votes. She will be out. A caretaker
government will be in place.
(BEGIN VIDEO CLIP)
NEWTON: And it will be in place. And perhaps even new elections called months down the road. In the middle of all this, as you mentioned, business
sentiment, very significant Richard and I'm glad you mentioned it, is turning against this government. They see it as a brighter future if this
government is led, if it's formed by another party. Even in some kind of caretaker form.
(END VIDEO CLIP)
[16:05:00]
NEWTON: And this is with the specter of the Olympics beginning here in just a few months. I mean, this political crisis before Richard had really
polarized this country and a lot of people said it was between an elite governing party that wanted to get back into power against the Workers
Party where Dilma Rousseff finds her base among the poorer in the communities here.
QUEST: Paula Newton who is in Rio following this story for us tonight. Thank you Paula.
With uncertainty surrounding Dilma Rousseff's future, deciding whether or not to invest in South America's largest economy, it is a delicate
calculation. Perhaps you need look no further than the map - or the graph that we saw earlier showing how the Bovespa has rallied some 18% merely on
the prospect of a change in government to know exactly the significance of latest developments.
(BEGIN VIDEO CLIP)
QUEST: Investors believe that this government needs to go. Rightly or wrongly, that's what the market is telling us.
(END VIDEO CLIP)
QUEST: As Clare Sebastian now reports, the political crisis is not the only piece in this complex puzzles now puzzling investors.
(BEGIN VIDEO CLIP)
CLARE SEBASTIAN, CNN CORRESPONDENT: A corruption scandal engulfing the government calls to impeach the President, the worst recession in 25 years.
Brazil is a puzzle that's growing more complicated by the day.
SAMAR MAZIAD, SENIOR ANALYST, MOODY'S INVESTORS: The magnitude of economic contraction is surprising.
SEBASTIAN: Samar Maziad is Moody's lead analyst on Brazil. The agency recently cut the country's credit rating to junk. The third major ratings
agency to do so.
MAZIAD: Things are happening very fast. And it's difficult to predict how the interaction between the political, economic and investor sentiment
would play out.
(CHAD MORGANLANDER, PORTFOLIO MANAGER, STIFEL NICOLAUS: We have an underweight on emerging markets, in particular Brazil.
SEBASTIAN: For Chad Morganlander who helps manage 230 billion in global assets, sentiment is cautious. He sees other external pieces in the
Brazilian puzzle. Falling global commodity prices and especially the slowdown in China, the market for around a fifth of Brazil's exports.
MORGANLANDER: Their growth rates going to continue to decelerate even if the most optimistic economist should expect that. And that is tied towards
the fortune or misfortune of their largest trading partner China.
SEBASTIAN: Most economists and investors agree the missing piece in all this is real fiscal reform to rebalance Brazil's economy and bring down its
debt. And many believe the piece standing in the way of that reform is Dilma Rousseff's government.
Will the hope for regime changes help strive the market higher this year, Morganlander says even if Dilma Rousseff is impeached, he wouldn't rush to
increase his investments.
MORGANLANDER: I would wait about six months to see how it all unfolds. Patient investors can make money but they have to stomach that volatility.
If there's no short-term fix to the - to Brazilian conundrum.
SEBASTIAN: All puzzles require patience and commitment. Especially when the final picture is still unclear.
Clare Sebastian, CNN Money, New York.
(END VIDEO CLIP)
QUEST: And for one traveller the first clue was that the flight was taking too long. Then a flight attendant came by collecting passports from the
passengers. They were all aboard Egypt Air flight 181 early on Tuesday.
(BEGIN VIDEO CLIP)
QUEST: And the truth was terrifying, that an Egyptian man claiming to be wearing an explosive vest had hijacked the aircraft. The drama ended with
this; the apparent hijacker walking down the steps of the plane to be arrested. The passengers and crew were all safe.
CNN's Ian Lee in Cairo explains how the crisis unfolded.
(BEGIN VIDEO CLIP)
IAN LEE, CNN INTERNATIONAL CORRESPONDENT: For more than five hour, all eyes were on this plane on the tarmac at Larnaca Airport in Cyprus. Egypt Air
flight MS181 was forced to land here early Tuesday morning after taking off from Borg El Arab airport in Alexandria. It had been bound for Cairo until
it was hijacked midflight. One passenger recounted the horror on that flight.
VOICE OF FARAH EL DIBANY, EGYPTIAN AIR PASSENGER: One of the cabin crew also told us that we are hijacked. We are being hijacked. So yes, and that
was it then there was a lot of panic on the plane and, so yes, we didn't know, they didn't tell us anything more, they didn't say what's wrong or
where we're heading, nothing, that we were just kidnapped, that's it.
LEE: A man now identified as 58-year-old Seif Eldin Mustafa, seen here being checked by security at Alexandria, later demanding the plane divert
to Istanbul.
VOICE OF AHMED ADEL, VICE CHAIRMAN EGYPTAIR: We got a call into our operations room from the captain that he has information about one person
who's claiming to have an explosive belt and asked to divert the airplane to Istanbul or anywhere else in Europe. The captain told him there's not
enough fuel to land in Istanbul so he diverted us to Larnaca Airport.
[16:10:12]
LEE: Most of the 69 people on board were allowed off the plane shortly after it landed in Cyprus but seven passengers and crew were held hostage
for several hours as negotiators worked for a peaceful resolution. They soon established this was not a terror attack, but say Self Eldin Mustafa's
motives remained unclear. Initial reports indicated he wanted to be reunited with his ex-wife. Prompting this response from the Cypriot
President.
NICOS ANASTASIADES, CYPRIOT PRESIDENT: Always there is a woman in the way.
LEE: But the Egyptian Prime Minister said he kept changing his demands.
SHERIF ISMAIL, EGYPTIAN PRIME MINISTER: (As translated) At some moments he asked to meet with a representative of the European Union and at other
points, he asked to go to another airport but there was nothing specific.
LEE: Then at 2:30 local time, this. More people emerged from the plane. Some run. This man casually walks down the aircraft stairs even taking time
to fumble around with his bag. Then another climbs out of the Egypt Air cockpit window to make his escape. They are met by Special Forces and
checked for explosives. Finally, the hijacker himself surrenders to police. He's searched on the ground. The bomb that's found is a fake.
Seif Eldin Mustafa remains in the custody of authorities. His passengers all safely returned to Egypt after what was a terrifying ordeal and a time
of heightened alert.
Ian Lee, CNN, Cairo.
(END VIDEO CLIP)
QUEST: So the scheduled half-hour flight turned into a six-hour crisis.
(BEGIN VIDEO CLIP)
QUEST: Now, Cairo to Alexandria was the original duration. The hijacker had wanted to fly to Istanbul. But there was clearly not enough fuel on board
the aircraft. After all if you think about it, it was being aimed just for a short flight and suddenly it's having to go all this much greater
distance. So it ended at Larnaca in Cyprus. And that's where the authorities got to grips with it.
The issue of course is what to do in such a crisis s this. Well, it's a very well-traveled pardon the pun route. The captain - or whoever is flying
the aircraft immediately set the transponder to change the squawk number. It's the international known for hijacking at 7500. The cockpit door of
course is kept closed throughout. These are ballistic preventive reinforced doors that post 9/11 should never be opened, certainly not in these
situations. And then the passengers and the crew are told to accommodate the demands as much as they possibly can. Let's put this all together.
(END VIDEO CLIP)
QUEST: Anthony Roman joins me to discuss this further. Good to see you, sir. Thank you.
ANTHONY ROMAN, CEO, ROMAN & ASSOCIATES: Good to see you.
QUEST: -- Thank you for coming in and talking. Right, you have flown commercial aircraft. You've decades -- I'm not aging you, you've decades of
experience in aviation and security, you're now Head and Chief Exec of Roman & Associates Investigation and Risk Management firm.
So you're the expert. Tell me what you believe was the good and bad here.
ROMANS: Well, I think there was good and bad. We've seen both at Egyptian airports. I think that the initial point of security where we view the
videotape and the security personnel approaches the subject and begins to search him. That physical pat down was not done properly and as thoroughly
as it could have been done.
(BEGIN VIDEO CLIP)
ROMANS: The question remains, did he have this so-called belt on him at the time that that was performed? If he did not, was it present in the luggage?
QUEST: Right, and here we actually see what you're talking about. Here he is, he comes through security. Talk us through this, please.
ROMANS: Right, and you see the security personnel approaches him. He puts his hands up to the side, which is appropriate, but security personnel does
a cursory pat down, which leaves much to be desired.
QUEST: Is he going all the way down the legs?
ROMANS: Yes, but he doesn't properly examine the collar, he doesn't properly examine the seams of the shirt, he doesn't pat down all of the
sections of the torso, front, back and sides. He he does not examine the jacket.
QUEST: Assuming -- well, we know he didn't have a bomb on him. These are very - these are v very difficult situations.
(END VIDEO CLIP)
QUEST: Because I agree in the case of Egyptian airports where there is a cloud over their security, you're more likely to take -- you're more likely
to think there may be a bomb than not.
ROMANS: Yes, I think they have what we would describe as minimalist security.
(BEGIN VIDEO CLIP)
QUEST: The security that's supposed to meet the IATA standards, the international standards for security at all international airports. Even
though they have their certification, I think it's a work in progress rather than meeting the standards at all airports.
(END VIDEO CLIP)
[16:15:03]
QUEST: In the flight deck. The captain's there, the door is closed, he's told by the chief flight attendant that we're being hijacked. He
immediately turns the transponder to the emergency code and does what?
ROMANS: Well he assesses the situation and determines from the flight attendants who are communicating what is the state of mind of the
individual, what's the likelihood that this is a real hijacking and a real threat, and begins to make decisions as to how much he should comply.
(BEGIN VIDEO CLIP)
ROMANS: His first and most important function is to determine what is the safest course of action to save the plane and the passengers.
(END VIDEO CLIP)
QUEST: Finally, for a pilot like yourself, facing these sort of situations, you basically - you have to get the plane on the ground as fast as
possible.
ROMANS: You do but you have to get it done as fast as possible in a suitable airport. An airport in which you won't face a larger more robust
threat number one. Number two that has runway and facilities that are suitable for a safe landing.
QUEST: Good to see you sir.
ROMANS: Thank you.
QUEST: Thank you very much indeed. Janet Yellen says there's uncertainty ahead. The market response a surge to the green. We know why that is of
course. It means interest rates won't be going up as far or as fast. We'll talk about that after the break.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
QUEST: It was a tale of two markets. Until lunchtime, it is in the red, in the afternoon, firmly in the green. So you may well ask yourself what
happened round about here that made everything turn positive.
Janet Yellen is the answer; when she said that the Fed will be cautious with raising rates. She expressed optimism about the U.S. economy.
Remember, we saw that GDP number yesterday showing the economy growing faster in Q4 than originally thought. And the chairman also warned of
global threats, chiefly China and oil.
JANET YELLEN, FEDERAL RESERVE CHAIR: Developments abroad imply that meeting our objectives from employment and inflation will likely require a somewhat
lower path to the Federal funds rate then was anticipated in December. Given the risk to the outlook, I consider it appropriate for the committee
to proceed cautiously in adjusting policy.
(END VIDEO CLIP)
QUEST: That is the clearest set of wording you're ever going to get from the head of the Fed to basically say interest rates will not go up as fast
as we had first thought. The Secretary-General of the OETC says now is the time for European countries to spark growth and create better jobs amid the
growing threat of terror across the continent.
Angel Gurria joined me in the C-Suite moments ago when I asked him what needs to be done to address the large number of Europeans living as an
underclass.
(BEGIN VIDEO CLIP)
ANGEL GURRIA, SECRETARY-GENERAL OECD: 75% of the people in the OECD countries live in cities. More than half of the world's population now
lives in cities. Therefore, that is where we have to focus a lot of the attention to provide for a better life. The people who are disenfranchised,
disenchanted are taking off and eventually, you know, becoming terrorism which is a terrible situation, we can't allow it to happen.
[16:20:08]
QUEST: But for the last eight to ten years, certainly since the great recession -- six to eight years, we've been told it has to be austerity.
There hasn't been the money for infrastructure, there hasn't been the money for social welfare. And in fact, social welfare has been cut.
GURRIA: After eight years of fiscal consolidation, after eight years of making the banks more stable, better capitalized, better regulated, you
know, better supervised, now's the time when countries can think of carefully chosen, some large infrastructure projects that can detonate
growth, that will look at the side of the demand you know, and that can provide more jobs, better jobs, better paid jobs, and then get into this
virtual circle that you were mentioning.
QUEST: How far are we from that situation? Because you've still got France in deep financial problems. You've still got a European growth rate which
is simply not good enough to bring down unemployment and you've got an ECB still printing money, more money.
GURRIA: We have now gone through the worst part of the crisis. But the problem is trade is growing at 2% it should be growing at 7%. Investment is
growing at 3%, it should be growing at 7%. Credit is pretty flat in the places where you need it more like Europe. And then -- which have been the
big engines of growth in the last ten years? It's been the emerging economies. They are in a very serious slowdown. So all your cylinders, this
is a European engine, so there's four cylinders, so all your cylinders have (speet). So you've got to get those going. But the question is, cities
normally are, you know, just receptive to national policies because all these big macro policies even climate change, water, whatever, are all
national policies. The question is then how do you bring that to the cities. And then also get to the cities to link better with the national
governments.
QUEST: Why do you consider this city -- because you're having meetings and seminars on this. Why do we consider cities so significant in that sense? I
remember the Liverpool riots in the U.K., decades ago, but in the end, whatever the failings in Liverpool it had to be national government that
came up with the policies.
GURRIA: You have to assess it from both sides. You know, the reason why you have to look at cities is the Willie Sutton story. You know, where is
- you know, why do you rob banks? Because that's where the money is. Well this is because this is where the people are. So this is where you've got
to deal with the issue. This is where you've got to get you know, the education, the health. You know Mayor de Blasio, he just put this
affordable housing.
You know housing is the biggest challenge. Everywhere is a -- the price of housing has gone up so much that now the new -- the new couples cannot
afford it, the young people cannot afford it, they're living longer with their parents or going back to live with their parents. This is a source of
frustration.
So with the exception of the United States which has created 14 million jobs in the last five to six years, everywhere we're still at like 10% of
unemployment. Youth unemployment, you know, 20, 30, sometimes 40%. So this is a massive challenge. And this is what's creating a whole generation that
is very frustrated. We promised them that if they went one year, two years, three years more, to study, to universities, to vocational training, they
would be rewarded by the markets. This is not happening. So we have to work on their skills. We have to make their jobs more portable, their skills
more portable. And now in Europe things are getting worse because of the migration flows.
(END VIDEO CLIP)
QUEST: That's Angel Gurria of the OECD.
Apple shares closed higher after the U.S. Department of Justice announced it was dropping its high-profile calls against the company.
(BEGIN VIDEO CLIP)
QUEST: And the reason will leave Apple executives and privacy executives with mixed emotions. The iPhone maker is no longer being asked to create a
so-called back door in the encryption software. The FBI says it's managed to hack into the phone used by one of the San Bernardino terrorists without
help from Apple.
CNN Money's tech correspondent is Laurie Segall, she joins me now. You've been following this very closely. So the only -- the first question is who
hacked the phone.
LAURIE SEGALL, CNN MONEY'S TECH CORRESPONDENT: Right, that's the question everybody's asking. Now, we don't have any details we can confirm but there
is speculation that it was an Israeli company.
(BEGIN VIDEO CLIP)
SEGALL: This is a third party company. They say that was potentially able to do this. And if you go, it's a company, they're saying is called
Cellebrite. If you go to their website, they say that they've worked with the government before and they also have on their website that they've been
able to extract data from the iPhone 5C, which is the same phone the San Bernardino shooter was using.
[16:25:09]
SEGALL: And the theory is they used a technique and this is all theory right now, but they used a technique called NAND mirroring. Which enables
you to take out the chip in an older version of the iPhone and copy it and that way if you try to guess ten passwords and it deletes all the data, you
have another chip. So that's what they're thinking could be behind it.
(END VIDEO CLIP)
SEGALL: But the bottom line is we don't actually have it confirmed as to which party was able to help the government. But you know the government
was not able to come up with the solution themselves Richard.
QUEST: No, but then you wouldn't expect them to because they haven't got that sort of level of expertise. You'd have to - you'd expect them to go to
the private market.
But as between Apple and the FBI, this issue has not gone away it's merely been deferred to the next case.
SEGALL: Sure. You know Apple has said - they said in a statement they said they hope that this causes a national conversation about civil liberties. I
want to read you what they said. They said "the case should never have been brought. We'll continue to help law enforcement with the investigations as
we've done all along. And will continue to increase the security of our products." But the Department of Justice kind of followed up and said that
we'll continue to pursue all options for data in the future. We'll go to the courts, we'll go to the phone manufacture.
QUEST: So as Apple is working on the seven or whatever it's going to be called, making encryption even harder to break, what's Apple's answer to
the government? Because let's face it, you know, arguably the good guys won this time because the Israelis managed to get in arguably, or arguably not
as the case may be, so what's Apple's answer for the future?
SEGALL: Right, I think that's the question. And that's why in a way this was a kind of victory for Apple. But at the same time, we're almost back to
square one. Because Apple's only going to build out more secure features. The technique I told you about that they were able to extract in the iPhone
5c, they can't do that anymore in the newer versions of the iPhone. They're going to try to build the unbreakable phone.
So what Apple will say the solution is, as they try to get you know these secure devices is probably legislation. Put this to congress. Let's have
the people decide what, you know, what the line is that wants to be crossed. Let's not use the All Writs Act which is what they were using to
make a decision that will set major precedent Richard.
QUEST: Carry on following this and when you know definitively, come back.
SEGALL - I'll be back.
QUEST: All right, we're going to continue talking about this after the break. John McAfee is with us. Sir, good to see you. We need your help
after the break to understand these difficult questions on privacy. Come and join me.
JOHN McAFEE: All right, you bet.
Break
(COMMERCIAL BREAK)
RICHARD QUEST, CNN ANCHOR: Hello, I'm Richard Quest. There's more Quest Means Business in just a moment. We'll talk about hackers holding an
entire chain of hospitals ransom in the United States. I need you to consider the question what would you do if you found a penguin in the
freezer? Be prepared to answer that issue, because we've got the strangest questions that have come up in job interviews.
Before all of that, this is CNN, and on this network, the news always comes first.
Brazil's largest political party has voted to abandon the President Dilma Rousseff and leave the governing coalition. And will greatly increases the
chances that President Rousseff will be impeached. Her government has been marred in a corruption scandal. And the country's worst recession in a
quarter of a century.
The hijacking of an Egyptian air passenger jet has ended peacefully in Cyprus. An Egyptian government spokesman says the hijacker who claimed to
have an explosives belt is now in police custody. The belt turned out to be a fake. All the passenger and crew are safe. One passenger tells CNN
it was a traumatic experience.
(BEGIN VIDEO CLIP)
UNIDENTIFIED WOMAN: Horrifying to be faced with death, kind of, for an hour and a half. Not knowing when it will happen or how. It was
terrifying. Sort of a good experience -- I mean, everyone was shivering still after they left the plane for a couple of hours. People were -- they
were totally stressed out. Even many hours after when we were all safe. It was very hard, it was very hard. Although he didn't have contact with
us so nothing happened on the plane. We just knew we'd been hijacked but its yes, it was very horrifying.
(END VIDEO CLIP)
QUEST: Police in Pakistan have detained more than 5,000 people since Sunday's bombing in Lahore, according to officials there. Most have been
released but around 200 people are still being held for questioning. A splinter group of the Pakistani Taliban has now claimed responsibility for
the blast, which killed 72 people, including many children.
Donald Trump's campaign manager has been arrested and charged with simple battery. After claims he grabbed a reporter's arms at a press conference.
Corey Lewandowsky turned himself into police in Florida and says he intends to plead not guilty. The spokesperson for the Trump campaign has called
for changes to how the media is allowed to access presidential candidates.
(BEGIN VIDEO CLIP)
KATRINA PIERSON, NATIONAL SPOKESPERSON, TRUMP CAMPAIGN: How's he supposed to know who every single writer is? It's insane to assume, particularly
with the number of reporters that are always trying to talk to Mr. Trump, immediately after, they walked into a brick wall of reporters. So of
course these things kind of happen. The scrum, if anything, perhaps campaigns, presidential campaigns, should begin to change the rules for the
type of access the press gets from here on.
(END VIDEO CLIP)
QUEST: U.S. Department of Justice says the FBI's been able to break into the phone belonging to one of the San Bernardino terrorists and now is
dropping the case against it. In February, the anti-virus software maker John McAfee offered to decrypt Syed Farook's phone. Avoid creating a
backdoor. Mr. McAfee joins me now. Good to see you sir.
JOHN MCAFEE, FOUNDER, MCAFEE: Good to see you again. There's no bell ringing today.
QUEST: They'll be no bell ringing. First question, were you the person who helped hack the phone?
MCAFEE: I was not, but I know who did. It was an Israeli company call Cellebrite. They've had a contract with the FBI since 2013 really. They
have a mobile forensics division, which creates a device about this big that you can plug a phone into, any phone, and they will, in fact, descript
it. I'm sorry they're using this approach. The kind of like spyware. Companies build these devises that can break into anything. They're cheap.
The FBI can buy 100,000 of them. And it's almost the same thing as having a backdoor.
QUEST: But how then did the FBI -- I mean, if this was known and we've all known about it, how did the FBI -- why did the FBI go on this rabbit chase
against Apple when they could just as easily have called up this company and said, by the way, can you pop in next Tuesday, we need you to open a
phone for us?
MCAFEE: They knew full well they had the capability through Cellebrite to do this. They wanted to use Apple as a test case. Because if they could
get Apple to do a backdoor then they could go to the big boys. Google, which has 95 percent of the world market, and do the same thing for
android. This is so obvious. It is so obvious. And the fact they're still just dancing around the issue is strange. We were not stupid. We
don't --
QUEST: So why, so why get Cellebrite to do it and not continue the case against Apple? I mean you can always get Cellebrite to do it a week from
next Thursday. Why not continue the case? Because we know this is eventually going to have to be tried.
[16:35:02] MCAFEE: Well eventually, maybe. I think there was too much of an out roar. I mean I was on your show and I was pounding on the FBI
mouthpiece -- I hate to call them that -- very elegant and eloquent man -- and so was much of the rest of the world. It was such an unjust thing that
they were doing, it so obvious. And I was going to let go. I was going to nip at their heels all the way through, you know. My voice may be tiny but
people listen to it.
QUEST: So what is your answer? As Apple builds an ever more secure encrypted system designed to be unbreakable. What is your answer to law
enforcement who says stop building these unbreakable phones? We need to get in sometimes.
MCAFEE: Well you don't. This is the problem. This is the fallacy. The FBI wants us to believe that, like the old paradigm back in the `30s when
they were monitoring gangster, they'd listen to conversations. We're dealing with terrorists, which is a worldwide organization in a world full
of 5 billion people. Listening to conversations is not going to do it. We have to have a higher order of monitoring like the Chinese. They look for
patterns rather than specific discussions. And you can do that without breaking into a phone.
QUEST: But you do occasionally -- look, you said in this article in "Business Insider," you said, "America's cyber security is fragmented,
inconsistent and dysfunctional. Terrorist's attacks occur as if they were lightning strikes, unpredictable and indefensible. This is not true."
MCAFEE: And it's not true. It's not true because if you looked at the patterns of communication -- here's what terrorist do --
QUEST: But you still need to get into that individual terrorist's phone.
MCAFEE: No, you do not. All you have to do is what the phone number is and whether or not he is making a call. There are thousands of devices
that are available to the FBI, the CIA and all 14 covert agencies that will allow you to monitor when a call is being made and to whom. Let me give
you an example. A husband and a wife, now, if you don't know anything about what they're saying on the phone, but all you know is every time the
wife leaves ear shot the husband makes a call. When the wife gets closer, he hangs up. Doesn't that tell you something? You don't have to listen to
the gory conversation, all sweet talk. No, the guy's having an affair or he's got a gambling problem or something.
QUEST: So in this scenario, why then is the FBI stubbornly continuing down this road, rather than, as you say, maybe going this other way of looking
at the bigger data issue in question?
MCAFEE: Well, I don't know. That's a great answer. I wish they would tell me. I wish anybody in the government would tell me why we're so
behind. Why we still insist on using this ancient paradigm of intelligence gathering.
QUEST: Ultimately, John, do you believe, though, on the wider issue, whether it's phones or computers or whatever it is, on the political
philosophical question, at some point, the Supreme Court has to rule on this balance between our right to digital privacy versus the government's
right to law enforcement.
MCAFEE: I don't want to phrase it that way. It's not our right digital privacy versus law enforcement. It's our own security versus the small
security that the FBI says by giving us by getting into these phones. Because by giving these universal keys, anybody can get into our phones,
not just the FBI. Hackers, China, Russia, Iran, that's the problem. That's why we don't want a key.
QUEST: We hope you, sir, will come back and talk more about it right here.
MCAFEE: Thank you very much.
QUEST: Thank you very much.
Now, let's talk about this even more. Why the FBI has been called in to investigate a crippling computer virus infecting MedStar Health which
operates ten hospitals and dozens of clinics in the United States. This is a classic case of hijacking of a different nature. The virus prevented
staff from logging on to the system, forcing a return to paper documentation in order to keep the hospitals running. U.S. hospitals have
recently been the target of several hackers. It's ransomware. It's a virus which encrypts digital files. The hackers don't release the key
until they are paid off. CNN's money Jose Pagliery joins me. First question to you, sir. How wide spread is ransomware and how often is the
ransom paid?
JOSE PAGLIERY, CNN MONEY, CORRESPONDENT: It's pretty widespread, and we have no often how often it's paid. Because when company's pay it they like
to keep it quiet. Let's keep in mind what this is and who it's affecting. Ransomware is a virus that slips into a computer system with just an e-
mail. You click on the wrong link and get it in. And hospitals have been affected by this, police departments, local governments. Lots of people
are getting this into their computer systems which locks their computer files down. Normally, that sounds like an annoyance. But in this case,
with something like a hospital, we're preventing people from actually accessing records.
QUEST: Why have we not managed to create sophisticated software to defeat this ransomware?
PAGLIERY: Because this software could look like any other kind of software getting into your computer system. This shows why cybersecurity today, why
having safe computer systems is difficult.
QUEST: Look, if it's a kidnapping of an individual, the rule is you don't pay a ransom, because it only encourages more. But I'm hearing that more
companies -- for example there was the other hospital group in California - -
PAGLIERY: Yes there was on in Hollywood --
QUEST: They paid.
PAGLIERY: -- they paid $17,000 -- to open it up.
QUEST: So now we have an economic issue here, don't we? The ransomware hijackers, the crooks, have priced it at just the right level that the
hospital's going to say --
PAGLIERY: This is a business, they have a business model and it's working. They don't price it high enough so you won't pay. They price it just high
enough so you will. And companies are paying it. Because it's easy to. Because otherwise they don't get the files back.
QUEST: But I'm sorry to say but this goes against every tenant of traditional blackmail and kidnapping.
PAGLIERY: Sure, sure.
QUEST: That it only encourages more.
[22:40:01] PAGLIERY: Sure, but tell that to the hospital that can't get its files right away. I'm not defending it. What I'm saying it makes
sense. They're acting in their own self-interest.
QUEST: So who's doing what to actually beat these ransomware villains?
PAGLIERY: Cyber security companies are up to all sorts of stuff. Trying to figure out how to manage the data that comes into the computer network.
Trying to stop the virus from infecting the computer system before it does. They're trying to figure out a way whether or not they can descript the
files that are encrypted. But so far, they're not making much ground on this.
QUEST: Why not?
PAGLIERY: Because it's difficult, cybersecurity's hard.
QUEST: Are we likely to see -- because at the moment this is very much under the radar. You see a couple of cases reported every now and again.
And nobody -- thankfully, we have you to talk about it. But nobody really likes to talk about it because everybody's terrified.
PAGLIERY: Right. Here's the thing to remember. This is the very low level hack. You don't have to be smart to have a ransomware program and
set it up so that you're infecting people. OK. We're going to see a whole lot more of this. Not just at hospitals, but a companies. Can you imagine
if a fortune 500 company suddenly has an entire office shut down because of ransomware, where they can't access computers? We'll see more of that.
Trend Micro, a really big cyber security firm, said 2016 will be the year of this type of extortion. I think they're right. Because it's easy to
pull off. It's a business model that so far has worked for cyber criminals.
QUEST: And I have a nasty feeling that Bitcoin is in here somewhere in here. Into how the ransom is paid.
PAGLIERY: Only because it's a digital currency that's hard to trace. If it weren't Bitcoin, it would be MoneyPak, it'd be Green Card, it would be
Western Union. And these are used as well with ransomware. Just less so than Bitcoin
QUEST: Please, I have a commission for you, get some more on this. We're fascinated by it here on QUEST MEANS BUSINESS. Absolutely fascinated by
it. Just because it's one of the things you're always told, don't pay the ransom. Good to see you sir.
PAGLIERY: My pleasure.
QUEST: Donald Trump is making a bet. He's standing by his campaign manager who's accused of assault and Trump is counting on voters to stand
by him. We'll talk about that after the break. It's QUEST MEANS BUSINESS.
(COMMERCIAL BREAK)
QUEST: Donald Trump has come out with a strong defense of his campaign manager. He stands accused of battery. "Wow, Corey Lewandowski, my
campaign manager and a very decent man, was just charged with assaulting a reporter. Look at tapes --nothing there!"
This is the tape. It's from March 8. The reporter in question is Michelle Fields, now look at the bottom of the camera. It's in white and there you
have it. She told police she felt someone yank her back resulting in bruising. Police have charged Lewandowsky on Tuesday after he turn himself
in. He was later released and is due in court in May.
[22:45:06] David Gergen, we need you, sir. I mean, in an extraordinary -- you couldn't write this, David.
DAVID GERGEN, CNN, SENIOR POLITICAL ANALYST: Just when you think this campaign could not go any lower, it does. It plunges. And here we are at
another new low. I think most Americans are sort of, like, disgusted with it all. But you have to say that in fairness to Donald Trump, as odd as
this may seem, his numbers seem to be fairly durable within the Republican Party. For days now we've been consumed with a story that is outlandish
about the two candidates, Cruz and Trump going after each other's wives. And Trump's numbers among women seem to be holding up within the Republican
Party. But if you look at nationwide, he's cratering. He's gone in the last few months from 58 percent of all American women disapproving of him
to now 73 percent of all voters who are women now disapprove of Trump. You're getting into unelectable territory here, very seriously.
QUEST: Listen to what Donald Trump said. He's just spoken about the issue with Lewandowski on the campaign trail in Wisconsin, here's what he said.
(BEGIN VIDEO CLIP)
DONALD TRUMP, U.S. REPUBLICAN PRESIDENTIAL CANDIDATE: Corey's a fine person. I looked at the tape. The tapes were supplied by me. You know,
those tapes, just so you understand. It's a very high-end plot -- we had tapes all over the place. And we supplied those tapes. And those tapes to
me are very conclusive. A lot of people are looking and saying how can anybody be charged? She was actually -- if you look at her, my looking and
according to a lot -- she's grabbing at me. And he's acting as an intermediary, and trying to block her from doing that.
The news conference was over. It was done. It was finished. And she was running up and grabbing and asking questions. She wasn't is supposed to be
doing that. And I think that -- I told him, you should never settle this case, you should go all the way. I think they really hurt a very good
person. And I know it would be very easy for me to discard people. I don't discard people. I stay with people. That's why I stay with this
country. That's why I stay with a lot of people that are treated unfairly. And that's one of the reasons I'm the front-runner by a lot. If you look
at that tape, he was very, very seriously maligned and I think it's very unfair.
(END VIDEO CLIP)
QUEST: Lots of verys in there, David Gergen. Is Trump wise to defend Lewandowsky in this way at this point?
GERGEN: Well, different people see different things in those tapes. I do think and this is a new wrinkle, I had not appreciated that his campaign
had produced the tapes and given them. So they clearly felt that there was no battery, if you would. Here's the thing, Richard. I think Donald Trump
is wise to be loyal to his people. I also think that the individual involved here should take a leave from the campaign. He's a distraction.
This ought to be a campaign about the issues. Donald Trump has shown he can basically run his own campaign. I think this young man should take a -
- should seriously think about whether this stands in the way of the Trump campaign.
You know, these are the kinds of things that can really hurt a candidate and this kind of controversy and Wisconsin vote, which is a week away, is
extremely important one now. It's becoming pivotal. Because Ted Cruz is closing in. And Wisconsin -- and John Kasich is coming up quickly. So,
you know, I think they need to -- they need to clear the decks of all of these subterranean and, frankly, secondary issues and focus on the big
issues, about jobs and growth and international standing, what are we doing about the Middle East. Somebody at the end of this process is going to be
president of the United States. The most powerful job in the world. They ought to be acting -- having a serious campaign that reflects that.
QUEST: Just before we leave you, I just want to check in on the other side. Bernie Sanders had a very good weekend with three states.
GERGEN: Yes.
QUEST: Does that alter in your view the ultimate outcome for the Democrats?
GERGEN: I don't think it alters the ultimate outcome for the Democrats in that Hillary Clinton is still the overwhelming favorite to become the
nominee of the party. But I do think that Bernie Sanders is going to have more clout at the convention when it comes to what's going to be in the
platform of the Democratic Party and what is he going to ask of Mrs. Clinton by way appointments and by way of policy positions that will give
him the enthusiasm to be a fervent supporter of hers in the general campaign. She need him in this campaign. She needs him to mobilize his
army. So I think those three victories give him more strength going towards the convention and the outcome of the convention and what the
platform is.
[22:50:00] QUEST: I would say, David, who knows what we will have next in this election, but I suspect.
GERGEN: Well, but you're exactly the right to be commenting at this point.
QUEST: Thank you, I look forward to being on the campaign trail with you in the fall. David Gergen, thank you.
GERGEN: OK, take care.
Now in a few hours you hear the Republican candidates, including Donald Trump. They're going to answers questions directly from voters. CNN is
hosting a town hall in Milwaukee with the three remaining candidates. You can watch it live, one in the morning only on CNN. We will be back in
minute.
Now look, we've all had job interviews where there have been some very strange questions, but we've got the strangest of the strangest. Well,
that's what you'd expect on QUEST MEANS BUSINESS, after the break.
(COMMERCIAL BREAK)
QUEST: Please, Mr. Mannequin, I really would be very good at this job. No, no, I want to work for you company incredibly. Ask me any question you
like, sir. Anything at all.
When you go for a job interview, you want to be ready to answer all the question you can think of. So when it comes to this interview I know about
the company. I know about Mr. Mannequin's career. I know the industry overall. But there are some questions I just can't foresee. They're known
as the oddball questions. And now, the employment site Glassdoor has compiled the top oddball questions for the year.
And we're going to show you exactly what they are. So an applicant to the clothing store Urban Outfitters was asked, "What would be the name of your
debut album, assuming you actually brought one out." Then you have the sales and marketing company that asked an interviewee, "How would you sell
hot cocoa in Florida?" A tough sell, cocoa on the beach. And finally, there was Uniqlo's questions. Now Uniglo asked, "If you had $2,000, how
would you double it in just 24 hours?" The point about all these questions, whether it's dollars or discs or cocoa, the point about them
all, there's no right answer. They're looking to test how you answer the question. Your mind thought processes. How you would integrate with Mr.
Mannequin over there in the corporate environment. So as for the $2,000 question, we went out on the street to see what New Yorkers said they would
answer.
(BEGIN VIDEOTAPE)
UNIDENTIFIED FEMALE: If I gave you $2,000, how would you double that?
UNIDENTIFIED MALE: Investment.
UNIDENTIFIED FEMALE: What would you invest in?
UNIDENTIFIED MALE: Electronics.
UNIDENTIFIED MALE: Black jack.
UNIDENTIFIED FEMALE: Roulette.
UNIDENTIFIED MALE: Poker.
UNIDENTIFIED MALE: The stock market.
UNIDENTIFIED FEMALE: What would you invest in?
UNIDENTIFIED MALE: Hybrid.
UNIDENTIFIED FEMALE: I would probably invest in a mutual bond.
UNIDENTIFIED FEMALE: How would you sell hot chocolate in Florida?
UNIDENTIFIED MALE: With girls with bikinis.
UNIDENTIFIED MALE: Hot cocoa over ice.
UNIDENTIFIED FEMALE: I would put ice cubes in it.
UNIDENTIFIED MALE: You'd have to be served -- hot, definitely hot.
UNIDENTIFIED MALE: Hot chocolate, get your hot chocolate here.
[22:55:00] UNIDENTIFIED MALE: I feel like that sells itself. Chocolate is like the most delicious thing in world. Everyone what's chocolate all the
time.
UNIDENTIFIED FEMALE: What would you call your debut album?
UNIDENTIFIED FEMALE: My debut album? I have no idea.
UNIDENTIFIED MALE: Paradise. Paradise.
UNIDENTIFIED FEMALE: Paradox?
UNIDENTIFIED MALE: Paradox.
UNIDENTIFIED FEMALE: It would be one and only.
UNIDENTIFIED MALE: Liquid sheep.
UNIDENTIFIED MALE: A.J. the great.
UNIDENTIFIED FEMALE: How to be single.
UNIDENTIFIED FEMALE: What would you debut album be called?
UNIDENTIFIED MALE: I'm sorry?
UNIDENTIFIED FEMALE: Your debut rap album.
UNIDENTIFIED MALE: I'm sorry.
UNIDENTIFIED FEMALE: I don't think I'm going to take this job.
(END VIDEOTAPE)
QUEST: I have to agree, I don't think she'd get the job either. @richardquest is how you can join in on how you would double $2,000 or what
would be your debut album. You will need to think about this while you "MAKE, CREATE, INNOVATE."
(COMMERCIAL BREAK)
QUEST: I hate those pretentious questions. Tonight's profitable moment. The ones that have no answers, supposedly designed to make you think and
show you're out of the box character. To me they're a waste of time. They're designed to trap you and they're best left away from it. Keep the
questions simple. That's how you find out if people really are any good. That's QUEST MEANS BUSINESS for tonight. I'm Richard Quest in New York.
Whatever you're up to in the hours ahead, I hope it's profitable. We'll do it again tomorrow.
END
