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White House 'Can't Guarantee Trump Never Used N-Word'; Trump Blames Sessions for Mueller 'Witch Hunt'; Paul Manafort Defense Rests Without Presenting a Case. Aired 5-6p ET

Aired August 14, 2018 - 17:00   ET

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

JAKE TAPPER, CNN ANCHOR: -- Jim Sciutto. He is right next door in THE SITUATION ROOM. Thanks for watching. We'll see you tomorrow.

[17:00:10] JIM SCIUTTO, CNN ANCHOR: Happening now, breaking news. No guarantee. White House press secretary Sarah Sanders says she cannot guarantee that no recording exists of President Trump using a racial slur. But other secret recordings have already triggered a nasty response by the president.

Interviewed by Mueller. Omarosa makes a stunning revelation that she's already spoken with Mueller. What could this former White House insider and longtime Trump associate tell the special counsel?

Reality bites. Two former reality stars go at it tooth and nail. President Trump unleashing a Twitter tirade against former "Apprentice" contestant Omarosa, calling her a "crazed, crying lowlife" and a dog. Is he afraid of what her next secret tape could reveal?

And no defense. former Trump campaign chairman Paul Manafort tells the judge he does not want to take the stand, and his defense team rests without calling a single witness or presenting a case. Is there a strategy at work here?

Wolf Blitzer is off today. I'm Jim Sciutto, and you're in THE SITUATION ROOM.

ANNOUNCER: This is CNN breaking news.

SCIUTTO: The breaking news, an extraordinary new claim by former "Apprentice" star and ex-Trump White House official Omarosa Manigault- Newman. She now says that she's been interviewed by Special Counsel Robert Mueller after saying earlier that she is ready to provide Mueller with secret recordings.

Some of her recordings set off a Twitter rampage by President Trump, calling her a "crazed, crying lowlife" and a dog while denying that he used a racial slur.

White House press secretary Sarah Sanders says the president is simply voicing frustration but says she cannot guarantee that a recording does not exist of him using that slur. I'm going to speak with Senator Ben Cardin and our correspondents and specialists standing by with full coverage. Let's get straight, though, to our breaking news and CNN senior White

House correspondent Jeff Zeleny. He's at the White House. Some extraordinary language by the president and really, just a stunning defense from the White House if you can call it that. Jeff, take us through it.

JEFF ZELENY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Well, Jim, it was extraordinary language when you stop and think about it. The president of the United States calling one of his former employee a dog, and that employee happened to be the highest ranking African- American official here at the White House, who of course, now is waging a war of her own against this very White House.

Now, at the press briefing today, press secretary Sarah Sanders said, "Look, the president insults people of all races equally." He said he fights fire with fire.

Jim, one thing is clear here tonight. There's plenty of that.

(BEGIN VIDEOTAPE)

SARAH SANDERS HUCKABEE, WHITE HOUSE PRESS SECRETARY: I can't guarantee anything. But I can tell you that the president addressed this question directly.

ZELENY (voice-over): That's how White House press secretary Sanders answering the question tonight of whether a recording could exist of President Trump ever using the "N"-word while producing his "Apprentice" reality show.

The president has repeatedly denied using a racial slur, as his one- time friend Omarosa Manigault-Newman has claimed. As she wages war with the White House.

SANDERS: If at any point we felt that the president was who some of his critics claim him to be, we certainly wouldn't be here.

ZELENY: Tonight, Omarosa also saying for the first time that she's been interviewed by Special Counsel Robert Mueller in his investigation into the 2016 election.

MANIGAULT-NEWMAN: I have.

ZELENY: In her latest explosive claim, she insisted to MSNBC she's spoken to Mueller's team, blasted by the president as a witch hunt for its investigation of Russian interference and possible collusion with the Trump campaign.

MANIGAULT-NEWMAN: That's the extent I can go in discussing that, as well.

ZELENY: But it's unclear what, if anything, the former White House staffer who was fired last December, could offer Mueller's team. Her comment comes in the wake of a racially-charged controversy of the president --

DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES: Lowlife.

ZELENY: -- who referred to her today as a dog.

The president, out of public view at the White House, instead taking to Twitter saying, "When you give a crazed, crying lowlife a break and give her a job at did White House, I guess it just didn't work out. Good work by General Kelly for quickly firing that dog."

Sanders insisted the comment was not racist.

SANDERS: The president's an equal opportunity person that calls things like he sees it. He always fights fire with fire.

ZELENY: She offered up an unusual character witness, the Clintons, and saying it was curious that charges of racism against Trump hadn't been made until now.

SANDERS: Again, the person that a lot of his critics say he is certainly wouldn't have been in business with him for decades, certainly wouldn't have had Bill and Hillary Clinton, they attended his wedding. A number of Democrats begged him for campaign contributions. I mean, if they were who he said he was, why did they have these relationships with him?

[17:05:03] ZELENY: In a White House filled with considerable drama and remarkably little loyalty, the episode surrounding Omarosa took deceit and dysfunction to new levels from a president who promised this.

TRUMP: You've got to pick the best people. You've got to pick the right people.

ZELENY: In the last day alone, the president has sent at least nine tweets on his former staffer acknowledging, "It's not presidential to take on a lowlife like Omarosa" but doing it anyway, declaring, "Wacky Omarosa has fully-signed non-disclosure agreement."

The Trump re-election campaign today filed legal action against her, seeking arbitration of breaking an= 2016 confidentiality agreement in her new book "Unhinged" that offers a blistering yet unverified portrayal of the president and his administration.

Now, as for confidentiality agreements, Sarah Sanders defended them as common place in private business, and that much is true. But in government service they are almost entirely unheard of.

There is an exception, of course, for classified information, which is illegal to leak out. But in terms of disparaging a public official or blowing the whistle on something that, of course, is a practice of this democracy.

Now, as for this book, Sarah Sanders said the media should stop attracting attention to it. When asked if the president would stop tweeting about it, she didn't have an answer -- Jim.

SCIUTTO: Perhaps she could not answer. Jeff Zeleny, thanks very much.

Let's dig deeper now with senior congressional correspondent Manu Raju.

So Manu, first time we've heard that Omarosa interviewed by the special counsel. Now, she was close to the president through the campaign and into his administration. Do we have a sense of what topics he would ask her about? We know one line of inquiry is obstruction. The other line of inquiry remains whether there was any cooperation with the Russians.

MANU RAJU, CNN SENIOR CORRESPONDENT CORRESPONDENT: Yes. We really don't have a clear sense of that yet. We do know that from a source who's familiar with what happened during the White House that there was no interest expressed by the special counsel to interview Omarosa when she was at the White House.

But she writes in her book that she was contacted by the FBI in February 2018, and that was after she left the White House. And we have also not really heard her name being mentioned as part of other investigations into Russian meddling on Capitol Hill.

So this is an interesting revelation. And it's unclear exactly what she said. But she did make a pretty startling claim on MSNBC earlier today. She suggested that the president knew in advance about these Clinton campaign e-mails before the leak from WikiLeaks. She offered no evidence of those claims, but did she give any information about that to the special counsel?

Also said there was corruption that occurred. Also getting no evidence about that. What did she tell the special counsel about this?

And this all comes as it's becoming pretty clear that the collusion is still a key part of the special counsel's investigation. Yesterday Kristin Davis, who's that woman known as the Manhattan madame, she went on Chris Cuomo's show last night and discussed her interview with the special counsel last week and made it very clear that collusion is very much on the minds of the special counsel.

(BEGIN VIDEO CLIP)

KRISTIN DAVIS, ROGER STONE FRIEND: I think they're really genuinely concerned about whether or not any collusion happened with Russia. And so, their line of questioning really did revolve around whether or not this happened.

(END VIDEO CLIP)

RAJU: And of course, she is someone who's very close to Roger Stone, the president's long-time friend, associate. How much does she know about what Roger Stone knew in advance? If anybody knew about these e-mails that are coming up from WikiLeaks. It seems to be another key focus of the special counsel's investigation.

SCIUTTO: Yes. There's no evidence that Special Counsel Robert Mueller wastes time with witnesses or questions. President Trump in a long string of inflammatory tweets today taking another shot at the attorney general. He's done this before. Clearly, with the intention of undermining the Russia investigation. But this was particularly pointed this time.

RAJU: Yes. That's right. You know, he has gone over after Jeff Sessions for months with a public humiliation campaign of sorts, saying over the weekend that he was, quote, "scared stiff."

This time, in the aftermath of the firing of that FBI agent Peter Strzok, who, of course, sent those FBI -- those anti-Trump texts, he tweeted this this morning: "If we had a real attorney general, this witch hunt would never have been started. Looking at the wrong people."

And it's very clear that this is all part of an effort to perhaps pressure Jeff Sessions to eventually step aside. Maybe he would put in his own attorney general or loyalists of sorts for a tamp down on this investigation, because he knows if he fires Jeff Sessions, that could open up a whole other set of problems and doesn't want do go that far.

But Jim, all these attacks against the special counsel seem to be working with his base. A new CNN poll says that overwhelming, a majority of Republicans view this as an effort to discredit the presidency, even though Democrats view it completely opposite of the Republicans, but at least it's firing up the base heading into the midterms.

SCIUTTO: Of course, Republican lawmakers disagree with that. They consider the investigation substantial.

Manu Raju, thanks very much.

Joining me now is Democratic Senator Ben Cardin of Maryland. He's a member of the Foreign Relations Committee. Senator, thanks very much for joining us tonight.

SEN. BEN CARDIN (D), MARYLAND: Jim, it's good to be with you.

SCIUTTO: So, quite a lot of inflammatory rhetoric from this president again today, and the allegation of really even more inflammatory rhetoric.

[17:10:10] The president is denying that he ever used the "N"-word as it's known. We're not -- certainly not going to reference that word. But his press secretary, when pressed on that, could not simply utter the words that she could guarantee there is no tape of him using that word. What's your reaction to that?

CARDIN: Well, it's more of what we've seen before from this president. It's unpredictable. We know that he is impulsive. We know he does things that are embarrassing to the presidency, embarrassing to this country.

What we saw the day in regards to how he handled the personnel issues, that's another embarrassment. It's been one issue after the next. This is the president of the United States. This is a leader of the free world.

And yet, we have to defend the language he uses or the manner in which he conducts the personnel business in the White House? That's a scandal to our country.

SCIUTTO: Omarosa made another claim today. And again, she's making these claims, we should note, without presenting at least us, the public, evidence of this. But she claims that President Trump knew ahead of time that WikiLeaks would release the hacked e-mails of Hillary Clinton and other Democratic campaign officials.

She also says that she's spoken to special counsel Robert Mueller. Now to be clear, Omarosa is not the first person to claim that the president had advanced knowledge. What's your reaction? Is this significant information?

CARDIN: Oh, I think it is significant information. What we want to make sure is that the Mueller investigation is allowed to reach its conclusions. We are still concerned, and saw we tweets today that underscored this, that the president of the United States is trying to undermine the Mueller investigation.

So, yes. It's significant that whatever relationship there was between the president and the Trump campaign and the Russia, that's what Mr. Mueller's investigating. And he's looking to see whether there was coordination or collusion.

SCIUTTO: The president, perhaps not surprisingly, has glommed onto Peter Strzok's firing by the FBI to again call for an end to the Russia investigation, accused the entire FBI of bias in this; even called for the reopening of an investigation into Hillary Clinton's e- mails here.

I know that yourself and other Democratic lawmakers have at times pushed for legislation to protect the special counsel. The general reaction from the Republican side has been, "Well, the president's not going to fire the special counsel. He's not going to fire Jeff Sessions. It's not necessary."

Is there any change to that viewpoint as the president continues this really full-frontal assault on the special counsel and his own attorney general?

CARDIN: Well, Jim, it's very clear that the president's strategy is to undermine the Mueller investigation. Has very little to do with the firing of the FBI agent or the investigation of Hillary Clinton. It's a distraction, where he's trying to distract the investigation from doing its work looking at the connections between the president, his campaign and Russia.

So, it is very disturbing to see this type of distraction, but it should not remove our focus on giving Mueller the support he needs. Congress should pass statutes making it clear that we stand behind the independence of this investigation. We support it, and we will not at all allow the interference by the president of the United States or any outside forces.

SCIUTTO: Now, we know that the special counsel, Robert Mueller, has been looking at the president's tweets as part of his investigation into possible obstruction of justice. After all, the White House has itself described the president's tweets as presidential statements.

In your view, does the pattern of these tweets, these consistent attacks, does it fit into a pattern of obstruction of justice, attempting to interfere in this investigation?

CARDIN: As far as legal conclusions, I'm going to let the Mueller investigation make those legal conclusions.

But it's very clear to me and, I think, to the American people that the president is trying to influence this investigation. He is trying to undermine its credibility. He's trying to interfere with its timing as to when it does its work. It's trying to tell the American people that it's a waste of time. They're moving in the wrong direction. Where the president should be supporting the independence of the Department of Justice he does just the opposite.

So it's very clear to me and I think the American people that the president's trying to influence this investigation.

SCIUTTO: And we should note that the CNN poll that came out this morning found a large majority of Americans believe that the president is trying to interfere, and they also believe that he's lying about it.

Final question if I can. As you know, the president's former campaign chairman, he is under trial. His defense rested today without making a case.

But as part of that case, we learned that a banker who gave questionable loans to Paul Manafort was angling for a job in the Trump administration. This banker's name is Steven Calk. And that he, Manafort then forwarded those requests.

[17:15:14] We have the e-mail here of the jobs that this banker who, again, gave Paul Manafort these loans in the order of preference, the jobs that he wanted there. And this took three months after Manafort left the campaign.

What does that tell you about Manafort's role in the campaign? What does this tell you about Manafort's role in the campaign? And does this look like an unacceptable quid pro quo in your view?

CARDIN: Well, it certainly raises major questions. We know the Manafort trial has rested, so that case is now going to the jury. We know there's an active investigation by Mr. Mueller. These raise very serious questions as to whether there were any laws that were broken during these exchanges.

SCIUTTO: Senator Ben Cardin, thank you for joining us tonight.

CARDIN: Thank you. SCIUTTO: Coming up next, breaking news. As President Trump hurls

nasty insults at former reality star and former White House aide Omarosa, the White House says it cannot guarantee that no recording exists of the president using a racial slur.

And Paul Manafort tells the judge that he does not want to testify, and his defense team will rest without calling a single witness or presenting a case. Now a jury will soon decide the fate of the former chairman of the Trump presidential campaign.

(COMMERCIAL BREAK)

SCIUTTO: Welcome back. And more breaking news. Without presenting a case and without calling a single witness, the defense has rested in the fraud trial of former Trump campaign chairman Paul Manafort. Manafort spoke for the first time, telling the judge he did not want to testify.

CNN's Kara Scannell is outside the federal courthouse in Alexandria, Virginia. Is there a defense strategy here, Kara? Or was it just clear that there wasn't much of a defense to put up?

KARA SCANNELL, CNN CORRESPONDENT: Well, Jim, that's going to be a question for the jury. This is really projecting confidence here by telling the judge and the jury that they did not intend to call any witnesses and that Paul Manafort was not going to take the stand.

Instead they're hoping that they made their case by chipping away at the prosecution's witnesses, creating the seeds of doubts in the jurors' minds. That they have not met her burden.

In fact, after Manafort's team had rested, Kevin Downing, Manafort's lead attorney, came outside. He addressed the cameras. And let's take a listen to what he said in explaining why they rested without calling any witnesses.

(BEGIN VIDEO CLIP)

KEVIN DOWNING, MANAFORT ATTORNEY: Mr. Manafort just rested his case and he did so because he and his legal team believe that the government has not met its burden of proof.

(END VIDEO CLIP)

SCANNELL: Now, we're expected to hear more of that argument tomorrow in closing. Arguments begin tomorrow morning. Both sides will have two hours, up to two hours to present their case. And then the case will go to the jury for deliberations, Jim.

SCIUTTO: See how long. President Trump's son-in-law, Jared Kushner, he came up in some of the evidence the prosecution presented. How was he involved in the alleged scheme here?

SCANNELL: Well, Jim, Jared Kushner's name was not uttered in court, but he did surface in one of the government's exhibits. This all relates to the allegations that the chairman, Steven Calk of the Federal Savings Bank, had given Paul Manafort favorable loans, because he was angling for a position in the Trump administration.

So as part of the prosecution's case, they showed an e-mail in which Paul Manafort is recommending Steven Calk to be the secretary of the Army. He sends that e-mail to Jared Kushner. Jared Kushner responds, "On it."

We have not heard any more about that, but it is a piece of evidence that will go to the jury, Jim, when they pick up deliberations as early as tomorrow.

SCIUTTO: Yes, and that e-mail was sent three months after Manafort left the campaign. So clearly, at least out of the expectation of some influence with the administration.

Just final question. I mean, there's been a lot of speculation about this case and this sis some surprised that the defense did not mount a defense. Is there a concern among prosecutors, for instance, that Manafort is really playing for a pardon here?

SCANNELL: That's always a potential option. You know, nothing to that element has come up in court. No one has discussed any potential of a pardon here, but we do know that that is, you know, sort of part of the long game. Is there a possibility that Manafort would get a pardon? We don't know.

He also has another trial coming up next month in Washington, D.C., where he's facing other related charges about his foreign lobbying work. So there's a lot of risk for Manafort. If he were to take the stand today, he would lock in testimony that could be used against him in that next case, Jim.

SCIUTTO: That's right. He's got a whole other trial to face. CNN'S Kara Scannell at the courthouse there, thanks very much.

Coming up, more breaking news. As the president calls former aide Omarosa a lowlife and a dog -- those are the president's words -- the White House says it cannot guarantee that President Trump is not on a tape somewhere using an even worse racial slur.

And Omarosa reveals that she's already met with the special counsel, Robert Mueller. What could the former Trump insider reveal to Mueller?

You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

[17:29:22] SCIUTTO: Welcome back. Our breaking news. White Houses press secretary Sarah Sanders says she cannot guarantee that President Trump used, really, the worst racial slur and that she cannot guarantee there are no recordings of him using it.

Let's get more now from our experts. Thanks for joining us.

I think, you know, you heard this press conference earlier. For the sake of the viewers, let's play again when Secretary Sanders was pressed on this issue.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Can you stand at the podium and guarantee the American they'll never hear Donald Trump utter the "N"-word on a recording in any context?

SARAH SANDERS, WHITE HOUSE PRESS SECRETARY: I can't guarantee anything, but I can tell you that the president addressed this question directly. I can tell you that I've never heard it.

UNIDENTIFIED FEMALE: Just to be clear, you can't guarantee it?

SANDERS: Look. I haven't been in every single room. I can tell you the president has addressed this question directly. I can tell you that I have never heard it.

(END VIDEO CLIP)

SCIUTTO: Jackie, wouldn't that be a simpler one to answer, "No"?

JACKIE KUCINICH, CNN POLITICAL ANALYST: In any other administration, I think you -- you could say no. But she's been caught at the podium in the past saying something didn't happen, and it did. And it's just -- it's sad, and it's an indictment of where we are in this administration, that she can't make -- she can't say, "No, that's ridiculous. That doesn't exist."

SCIUTTO: And listen. It's in the public record that the president called her -- called Omarosa a dog, which some might say is pretty darn offensive, as well.

John Kirby, you served in that role. You stood behind the podium at the State Department and the Pentagon before having to answer some difficult questions. How do you analyze her answer? It seemed that she was protecting herself a bit to be contradicted by the records.

REAR ADMIRAL JOHN KIRBY (RET.), CNN MILITARY AND DIPLOMATIC ANALYST: Absolutely. It's the old podium poke 'em. And the first comment, "I can't guarantee anything," was immunizing her against the possibility that there is something there there and it's going to come out. So she can honestly say when that happens if that happens, if it happens, "Hey, look, I told you I couldn't guarantee it."

The second part of her answer was very much distancing herself by saying "the president asserts" or "the president said." And you're seeing Sarah do that much more often now. Instead of stating policy positions or positions in general, in the first person singular, she's doing it in the third person. The president said, the president --

JEFFREY TOOBIN, CNN CHIEF LEGAL ANALYST: Can I just say --

SCIUTTO: Please. TOOBIN: Can I just say one -- I'm sorry, Jim. I'm sorry to barge in

here. But you know, this whole idea that we have to do this mystery hunt to see whether Donald Trump is a racist, hmm, he built his career on a racist campaign against the first African-American president, saying he wasn't born in this country. He repeatedly race -- tweets racist tropes. He calls African-American -- countries with black people s-holes. Hmm. Too bad Sherlock Holmes isn't alive to figure out, like, whether Donald Trump is a racist on this tape.

SCIUTTO: Laura Coates, I want to give you a chance to respond, because there is a pattern here, and it's not the first time the president has used -- set aside for a moment the "N"-word and whether there's an audiotape of that.

But as Jeff says, in the public record already is some fairly alarming language. One of President Trump's favorite is to refer to Maxine Waters, an African-American congresswoman, as low I.Q., and he uses it because in his rallies he gets -- it's a big applause line for him.

LAURA COATES, CNN LEGAL ANALYST: It is and of course, the president is mistaken about the level of intellect of anyone, particularly African-Americans and it's not only not a novel concept that a president trying to attack the intellect of a black American. You can go back as far as Roosevelt talking about the perfectly stupid race of the negro. You can think about literacy tests that were being used to try to remove us from the franchise of being able to vote. And you see this time and time again about the attack on intellect.

What you are seeing now, as well, is the attack on the intellect of the entire American people that would not already realize it's a foregone conclusion how you can describe him in his comments in the ways in which he has tried to demean and disparage.

And the comments today about Omarosa, her being a dog and her other comments, of course, also belie his earlier statements of what he thought she was.

But I think at some point in time, there's so much methane in the room that somebody has to clear the air. And I think Sarah Sanders was trying to avoid that and saying, "I'm going to hedge, not going to do. This I'm not going to have the credibility on the line exponentially every time. Sadly, we are well past the point of credibility, because whether there is racism, misogyny in the West Wing is a foregone conclusion. What is not and what the American people can do about it.

You can see her. There's a reason that White House press secretaries protect themselves because they have been screwed before, excuse the expression, when they had to defend or the president contradicted them.

I want do get to an issue. Because this was another misleading moment from the podium today. The White House press secretary, Sarah Sanders, said, "Listen, there have been some non-disclosure agreements." NDAs, as they're known, in government service all the time." That may be true but the fact is, that relates to the disclosure of

classified information, not to what are known as non-disparagement clauses, meaning requiring former administration staff never to say anything critical about the administration or members of the administration.

I'm going to quote from the Trump campaign non-disparagement clause for the 2020 campaign: "You cannot -- you have to promise and agree not to demean or disparage publicly in any form, or through any medium the campaign, Mr. Trump, Mr. Pence, any Trump company, any Trump or Pence family member or any Trump or Pence family member company, or any asset of any of the foregoing."

I mean, this -- the fact is this does not happen for members of an administration. Jackie Kucinich, you've covered a lot of campaigns here. Why does the administration and why does the press secretary claim that is normal when the fact is it is not?

[17:35:07] KUCINICH: Because it's normal for President Trump. This is -- I mean, I don't know that Mike Pence has a lot of companies. This seems to be retrofitted from a Trump administration NDA.

And frankly, this hasn't been tested before. If a -- let's say Omarosa is being dragged into litigation with this. We'll see if it holds up. And if it is and she apparently didn't sign one in the White House, Don McGahn has -- there's plenty of reporting on Don McGahn saying, "I don't think we can hold -- this will this hold up," the ones that were signed inside the White House. Those might not hold up. That hasn't been tested because this is so unusual.

SCIUTTO: Jeffrey Toobin, is it legally defensible?

TOOBIN: Well, I don't know. I mean, these have not been tested. But I'll tell you one thing that's significant in a broader way is that not only do these nondisclosure agreements restrict freedom of speech, they have arbitration clauses, which means that the disputes that come out go to secret arbitration. They don't go to courts.

And this is happening more and more in corporate America, that individuals give up their right to sue and have to agree to go arbitrate where the first amendment doesn't apply in the same way and where it's not a public proceeding and corporations and defendants do awfully well. This is a lesson not just about this case but about all of how individual rights have been diminishing.

SCIUTTO: No question. You see that host of liability suits. No question.

Smart points all. Stay with us. There's more to discuss. Coming up, President Trump's former campaign manager says that he won't take the stand in his own trial. And his team of attorneys is declining to call a single witness in his defense. We're going to discuss that case with our legal experts.

(COMMERCIAL BREAK)

[17:41:29] SCIUTTO: Welcome back. And we are back with our panel.

Laura Coates, I want your thoughts on the latest developments in the Paul Manafort trial. So the defense attorneys rest. They don't call a single witness. Paul Manafort himself declines the opportunity to testify in his own defense.

Is that a sign of weakness in the defense case or could it even be confidence? or is it a whole other sort of strategy?

COATES: I think it's extreme arrogance on one hand. Because they're hinging their entire case that the jury will see a lack of credibility of Rick Gates. They'll think to themselves here's somebody who embezzled. Here's somebody who was an adulteress [SIC]. Here's somebody who has lied to the FBI. So therefore, you cannot trust this person.

However, no one has ever had the perfect witness. You know who testifies against pimps? Prostitutes. And drug dealers, the drug addicts.

SCIUTTO: Mob bosses, the capos.

COATES: Mob bosses or how about co-conspirators in cases? So the idea of the perfectly pristine, credible witness is just not there. But they're thinking that the documents will be essentially undermined by that credibility issue. I think it's a mistake to do so.

Also, he has tremendous exposure if he takes the stand. He'll be completely clobbered in a cross-examination, and he has an upcoming trial. He'll use his entire transcript as a way to question him again later on for the next one even, if this one's not successful.

SCIUTTO: Jeffrey Toobin, handicap -- handicap this.

TOOBIN: Well, you know, what I don't -- I agree with everything Laura said, but there's another point here. Is that if you look at the charges in this case, several of those charges have nothing to do with Rick Gates at all. That he is not involved in those.

And, you know, Rick Gates, if he's such a terrible person, why was he doing all this stuff for Paul Manafort's benefit? It wasn't for Rick Gates' benefit. Certainly not most of what he did in terms of the transactions.

You can be sure that the summation's going to be "Rick Gates is such a terrible person. He's a liar. He's this, he's that."

But why was he getting money into Paul Manafort's pocket? To no benefit to himself. I just -- I've never understood the defense in this case. And take it from someone that predicted that Hillary Clinton was going to win in 2016. I don't see how Paul Manafort wins this case at all.

SCIUTTO: I was in the courtroom for a lot of it, and beyond Rick Gates' testimony, you have a whole electronic paper trail. You have loads of e-mails describing the requests about particular loans and money transfers, et cetera, Jackie.

Is this -- how important is this for the special counsel? Right? I mean, this is a special counsel joint as it were, but it's not related to Russian involvement in the election. Is it important for Robert Mueller to get a conviction here?

KUCINICH: I think so. Because this is the first test of he's bringing this case that, I mean, I'm not a lawyer like esteemed colleagues here, but it seems like a slam dunk, because there is such a vast paper trail because you do have Gates there.

If he can't do that, when you get into some of the more complicated matters that he's dealing with, it just -- it would be better for Bob Mueller if this went his way.

SCIUTTO: John Kirby, if I could ask you, when you served in administrations before, when you have a former campaign manager e- mailing the president's son-in-law soon after the election saying, "Hey, can you get a job for the guy who questionably got me $16 million in loans? And by the way, here's his list of jobs in order of preference."

And the president's son-in-law responds by saying, "On it."

Is that significant? Is that shady? Is that something that folks at home should be concerned about?

KIRBY: To me it sounds shady, absolutely. I mean, look. There's always job bartering as a campaign moves from campaigning to governing and people are -- you join the campaign to get -- potentially to get a job inside the administration. But doing it this way through Trump, Jr., yes, it definitely seems to me and a little seedy and inappropriate.

JIM SCIUTTO, CNN ANCHOR: Well, Jeffrey, John --

JEFFREY TOOBIN, CNN CHIEF LEGAL ANALYST: Well, but --

SCIUTTO: Oh, sorry, go ahead. Quick final thought.

TOOBIN: Well, I was just going to say, yes, people try to get jobs for their friends in campaigns, but most of them aren't charged with multiple felonies.

SCIUTTO: Yes.

TOOBIN: I mean, that's what's so outrageous about this. It's not that he was the campaign chairman. He was the campaign chairman who may be looking at hundreds of years in prison. I think that's a significant difference.

SCIUTTO: It is. And we should mention that that -- the bank official involved there overruled other senior executives in the bank on that loan, apparently as a favor to Paul Manafort. Favors go around, they come around.

Thanks very much to the panel.

Please, standby because there is so much more news to discuss.

Coming up, why can't the White House Press Secretary simply guarantee that President Trump has never used a certain -- really, the worst of racial slurs?

And how did Omarosa manage to record her firing by Chief of Staff John Kelly in the top-secret -- really, the most secret room in the White House, the situation room? How serious and how dangerous is that violation?

(COMMERCIAL BREAK)

[17:50:59] SCIUTTO: Tonight, fresh concerns about a major security breach at the White House. A recording made inside the situation room by fired White House aide Omarosa raising serious questions tonight.

Our Brian Todd has been working the story for us.

So, Brian, you've been talking to security experts. How serious of a breach do they think this was?

BRIAN TODD, CNN ANCHOR: Jim, we are hearing that her taping of this conversation was an egregious violation of security procedures at the White House.

Former top intelligence official James Clapper calls it unthinkable that she would do that, but Omarosa says she had to make that recording to protect herself.

(BEGIN VIDEOTAPE)

TODD (voice-over): It's the heavily secured vaulted operations center where President Obama watched the killing of Osama bin Laden, where George W. Bush commanded the invasion of Iraq, and where Omarosa was fired.

OMAROSA MANIGAULT-NEWMAN, FORMER DIRECTOR OF COMMUNICATIONS, OFFICE OF PUBLIC LIAISON: Can I ask you a couple questions? Does the President -- is the President aware of what's going on?

GEN. JOHN KELLY (RET.), WHITE HOUSE CHIEF OF STAFF: Don't -- let's not go down the road. This is a nonnegotiable conversation.

TODD (voice-over): Tonight, some former U.S. officials are aghast that former Trump aide Omarosa Manigault-Newman secretly recorded her firing by Chief of Staff John Kelly in the White House situation room.

JAMES CLAPPER, FORMER DIRECTOR OF NATIONAL INTELLIGENCE: And you come on -- it's sort of an honor system where everybody knows not to do that. And that is a very serious security violation. It's just kind of unthinkable that that would happen.

TODD (voice-over): Larry Pfeiffer agrees. LARRY PFEIFFER, DIRECTOR OF THE MICHAEL V. HAYDEN CENTER FOR

INTELLIGENCE, POLICY AND INTERNATIONAL SECURITY, GEORGE MASON UNIVERSITY: Oh, absolutely, an egregious violation of security. It is the most sensitive and most secret and most protected place in the White House.

TODD (voice-over): Pfeiffer ran the White House situation room for two years under President Obama. He was there when the Benghazi attack unfolded, when the President monitored and commanded operations during Hurricane Sandy.

Pfeiffer says White House staffers understand that this cluster of actually three rooms is where the most crucial national security decisions are made, and before they enter, they have to leave their phones in lead-lined lockers outside.

PFEIFFER: Because of the concern that they could be used as recording devices or worse yet, they could be used as transmission devices and they could actually be picking up conversations that are taking place in the room or even perhaps picking up data streams that are in the area as well.

TODD (voice-over): Pfeiffer says the people who run the situation room watch staffers to make sure they don't pull out phones, and he hints there are devices monitoring them.

PFEIFFER: We have eyeballs on the situation room meetings as they're going on to make sure that nothing is being brought out from a pocket or being brought out from a binder.

And then there are some other means. I'm not at liberty to get into discussion about details of the other means, but there are other means and capabilities that assist the situation room in that job.

TODD (voice-over): Pfeiffer says staffers have to have clearance beforehand, have to swipe badges or be buzzed through thick doors into the room, and are greeted by situation room staffers when they enter.

Omarosa defends her recording in that room.

MANIGAULT-NEWMAN: No one would believe me if I didn't have that recording.

TODD (voice-over): And John Kelly himself is being criticized. "Washington Post" columnist Jim Hoagland calling it misuse of the situation room to isolate and fire an employee.

Pfeiffer won't criticize Kelly specifically but he regrets what happened.

PFEIFFER: It's the one thing a situation room director fears the most, is that the situation room will get sucked into the politics of the day.

(END VIDEOTAPE) TODD: Now, the White House has not responded to the criticism of John Kelly for bringing Omarosa Manigault-Newman into the situation room to have that conversation about her firing.

Could Omarosa be prosecuted for recording it? Most legal experts we talked to say, no, unless she recorded something of a classified nature in that room which, it appears, she didn't do, Jim. But she does have other recordings of White House conversations.

SCIUTTO: Right. And a lot of attention here to Omarosa's use of the cell phone there, but we're aware the President's been known to use his personal cell phone for some very sensitive conversations with world leaders, to talk to people outside the White House. People have this number.

Is that considered an equal or greater security risk?

TODD: It is, really, Jim, and there's no indication that his use of that phone has stopped. And if it continues, we're told this is a major problem. Former spies and intelligence officials tell us these conversations can easily be intercepted.

[17:55:02] Just this summer, the Department of Homeland Security reported there were cell phone surveillance devices called stingrays operating near the White House last year.

Those devices, they trick your cell phone into thinking that they're cell phone towers and they can intercept calls. The Russians and Chinese spies could be operating those devices near the White House and picking up the President's calls.

SCIUTTO: Brian Todd, thanks very much for looking into it.

Coming up, as President Trump hurls nasty insults at former reality star and former White House aide Omarosa, the White House says it cannot guarantee that no recording exists of the President using a racial slur.

(COMMERCIAL BREAK)

[18:00:03] SCIUTTO: Happening now, breaking news. I can't guarantee. White House Press Secretary Sarah Huckabee Sanders will not rule out the possibility that President Trump was caught on tape using a racial slur.