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ERIN BURNETT OUTFRONT

Sony Changes Course Releases "The Interview"; Hundreds Gather for New Protests After Cop Killings; Prosecutor: Delta Employee Smuggled Guns

Aired December 23, 2014 - 19:00   ET

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


ERIN BURNETT, CNN ANCHOR: OUTFRONT tonight, breaking news, protesters attempting to shut down a major shopping district in New York in defiance of the mayor's call to wait until the city's fallen police officers are buried. Could protesters and police collide tonight?

Plus, a defiant Sony Pictures, it is moving "The Interview" coming to a theater near you on Christmas Day -- yes, Christmas Day. What will North Korea do about it?

And a severe tornado slams Mississippi. Forecasts are calling for up to eight inches of rain along the east coast, flights cancellations piling up on one of the busiest travel days of the entire year. Let's go OUTFRONT.

And a good evening to all of you. I'm Erin Burnett. OUTFRONT tonight, the breaking news, Sony in a complete about face releasing "The Interview" to theaters on Christmas Day. Right now 58 theaters confirmed in 22 states, many more expected. Sony doing this in the face of threats from North Korea that the movie's released will trigger terror attacks, not just cyber but physical attacks on theaters and theater goers. Also today, North Korea's internet unstable another day. The U.S. has not yet claimed responsibility surprisingly North Korea has not blamed the Americans raising a crucial question of who is responsible. We have more on all of that breaking news in a moment.

But also tonight, the breaking news on the streets of New York. Hundreds of protesters gathering, numbers growing quickly on the streets. The police are on high alert after the assassination of two officers. The protests are going on despite a call by the mayor to wait until after those officers are laid to rest. New York officials announcing the lights of all city landmarks will be dimmed for five minutes tonight in tribute for the officers. Meantime, the department is ramping up security for the New Year's Eve ball drop, that is the biggest New Year's Eve event in the United States, more than one million people will be in Times Square. And we're also hearing from the widow of Officer Wenjian Liu. They had been married for only two months. She spoke today.

(BEGIN VIDEO CLIP)

PEI XIA CHEN, WIDOW OF WENJIAN LIU: This is a difficult time for all of our families. But we will stand together and get through this together. Thank you.

(END VIDEO CLIP)

BURNETT: My guest tonight, former New York Mayor Rudy Giuliani who met with the families of both officers today. We begin though with Miguel Marquez, he is on the streets of New York with a growing crowd of protesters. Miguel, growing very quickly, despite the weather, I know you've been walking and giving us your updates moving through the heart of New York in the shopping district. The crowd have been growing.

MIGUEL MARQUEZ, CNN NATIONAL CORRESPONDENT: Well, we may be getting a little smaller at the moment. It is about 500 or maybe 400 at the moment. We are now headed up Madison. It seems like we are headed toward Harlem. I'm going to show you, give you a sense of just how far this crowd goes back, it goes back about a block and a half but they are staying on a very thin sidewalk here which is keeping things a little more called for police. If we could show you the police. On this side, the number of police along the side of the street trying to keep protesters on this almost the same number as the protesters themselves. Moving that we will not make the -- cop who are on the patrol here tonight trying to keep these protesters safe and under control is that they are chanting things like, how do you spell racist NYPD? Those are the things are the very -- upsets cops and the benevolent patrol association all the way along. So, what they are asking for is for the Police Commissioner Bill Bratton to step down here. They recognize that the two police officers were shot and killed, assassination style, on Saturday. They are not using some of the more awful chants and nasty chants they were in earlier protests but they are very vociferous and they want to make their point -- Erin.

BURNETT: All right. Miguel, thank you. And as Miguel continues with the protesters we'll going to update you on the situation. Again, they have been told -- asked by the mayor of New York to refrain, to hold back until the funerals of the assassinated officers. Obviously this is in defiance of that.

The White House today announced Vice President Joe Biden will attend the funeral of Officer Ramos, that is the one for schedule, that will be Saturday. While the administration sent delegates to Michael Brown's funeral, this is a major statement. This is not just a delegate. This is the vice president of the United States.

Martin Savidge is OUTFRONT in Brooklyn, New York tonight. Martin.

MARTIN SAVIDGE, CNN CORRESPONDENT: Well, Erin, yes, no funeral has been announced yet for Officer Liu. That is still in the planning stages for his family, some have to come from China. But yes, the Vice President of the United States will attend the funeral for Officer Ramos. And it has been announced that the Mayor de Blasio will be there as well despite some who have said perhaps he should stay away given the tensions between the Police Department and the mayor's office. That said, Mayor De Blasio and his wife were here at this memorial site. This is the site where the shooting took place on Saturday. He appeared here early in the day. It was described as an unannounced visit. He paid his respects. And then later in the day he led what was a moment of silence. That was at 2:47, the exact moment at which the shooting took place on Saturday here in Brooklyn. That observation was done at city hall and also city hall has asked tonight that those public buildings in New York and landmarks as of 9:00 dim their lights for five minutes, also in tribute to the fallen officers -- Erin.

BURNETT: A very poignant moment. We'll see what the protesters do. Such a crucial part of this. Thank you very much, Marty.

And OUTFRONT tonight, former New York City Mayor Rudy Giuliani. Mayor Giuliani, thank you for taking the time tonight. I know that you just came from meeting with the families of the two assassinated officers.

RUDY GIULIANI, FORMER NEW YORK CITY MAYOR: I did. Yes.

BURNETT: How was that meeting?

GIULIANI: Well, it was very emotional. You know, it's been sometime since I was mayor and I lost so many police officers and firefighters even before September 11, about 50 and then September 11th in unbearable numbers. It is hard. It is very, very hard because you really don't know what to say to really comfort them. But it is remarkable what wonderful men both of these officers were, Officer Ramos and Officer Liu. These two officers represent what the New York City Police Department is all about. They remind me of my uncles. I had four of them that were police officers. They love being police officers, Officer Liu joined after September 11th because he was affected by September 11th. This police department, this New York Police Department is not an all-white police department. In fact, it is not even majority white police department I think. This is a very, very diverse police department. Hispanic and Chinese in this particular case -- Americans. So this kind of thing is been suggested about racism within the New York City Police Department, it is really an outrageous lie.

BURNETT: This issue about racism in the nation's biggest police department and indeed in police departments around the country, there was a couple of questions I wanted to ask you about that.

GIULIANI: Sure. Absolutely.

BURNETT: Our analysis actually was done on the issue of whether young black males were more likely to be killed by police in this country. They looked at federal data from 2010 to 2012, because aren't federal statistics on this particular issue, they found a 21 times more likely chance that a young black man would be killed by a police officer than a young white man. That is a pretty stunning statistic and it argues against what you just said.

GIULIANI: No, it doesn't. Statistics don't tell you anything. But we have to know what those 21 people were doing. By what percentage do black young men commit violent crimes compared to white? Isn't it like five, six, seven, to one. BURNETT: This is 21 to one.

GIULIANI: Well, fix, six, seven to one means it can be off a lot of concentrations. And a lot more interactions between the police in the black community than between the police and the white community. So you can't just look at a statistic like that. In the case of New York City, for example, 70-75 percent of the murders are committed by blacks. That is a statistic. That is not racism, that is a fact. So you would expect, if that is the case, if it is 70-75 percent, at the overwhelming majority of interactions dealing with violent crime are going to be with blacks -- unfortunately.

BURNETT: Right. But I mean, I see your point. But I mean, if you are going to play statistics that way, you are looking at 75 percent.

GIULIANI: Well, you're the one that brought up statics.

BURNETT: No, I know. But I mean, I'm saying is, if 75 percent of the crime is committed by blacks as you are saying, but again 21- one. That is still not in balance with the crime rate.

GIULIANI: But you have to know what those 21. You'll have to know what you are talking about. Not just the numbers. You have to know what kind of situations -- what kind of situation you are talking about. What kind of crimes were involved. What kind of provocation took place? Did one group more likely surrender and the other group not? I mean, in the case of both Mr. Garner and Mr. Brown, they were committing crimes. I mean, this is not a situation in which -- I mean the two officers were two innocent men that were killed. These two men were committing crimes. Now okay, in the case of Mr. Garner, he was committing a relatively minor crime.

BURNETT: Correct.

GIULIANI: But the reality is, if you are speeding, and you are pulled over and the police officer asks you for your license and registration, and you say, no, you've just taken a relatively minor situation and made it into a really major one because the cop is going to pull you out of the car and anything can happen. So before you analyze that, you have to know how are people behaving, how are they acting, how are they interact, you know what kind of danger the police officers in? I have found in New York City, that the overwhelming majority of cases, the police officers are justified in what they're doing. The exception is when they do something wrong and when they do, and when they do, they go to prison. This is a police department that in an overwhelming majority of cases, when a death takes place to justifiable situation where the police officers was in fear for his life.

BURNETT: But the issue of course as you know around the country now is that people see some cases where a lot of people think that justice has not been served, that an officer was not charged for something. In the case of Eric Garner. And you know, Kareem Abdul- Jabbar wrote about this and I wanted to get your response to what he said because I thought he wrote this pretty eloquently but maybe you will going to take issue with it but I'm curious. So, he wrote, in Time Magazine this week and this is in light of the assassination of the two police officers this weekend in New York City. He wrote, the marches, meaning the protests are meant to raise awareness of double standards, lack of adequate police candidate screening and insufficient training that have resulted in unnecessary killings. Police are not under attack. Institutionalized racism is. And he continues to give examples. He says, trying to remove sexually abusive priests is not attack on Catholicism nor is removing ineffective teachers an attack on education. He writes that very eloquently and doesn't he have a point?

GIULIANI: Of course he's got a point.

BURNETT: I mean, this is something that you would agree with that the protesters have a point. There are cases of access that need to be dealt with.

GIULIANI: No question about it. There are situations in which the police officers act ineffectively or even when the police officers act in a racially improper manner. There are situations like that. To give the impression that it is systemic is a cruel and really bad lie. And to create that impression for the last two months and to allow that to become the general impression, that this is a major problem within police departments is really unfair. The major problem is the amount of crime that we have.

BURNETT: But if that is a major problem -- hold on one second.

GIULIANI: The reality is --

BURNETT: Let me just, because I see your point. But then, you want to say it is not systemic but if you are not willing to talk about statistics including the one that I shared --

GIULIANI: I am willing to talk about it. I just want to know what those are all about. The -- the situation of racism in the New York City Police Department is the exception. The rule is a vast amount of crime.

BURNETT: Mr. Mayor, before we go, I have to ask you something else. The President, I know you are very critical of him on this particular issue of race. You've also been critical of him on the economy. Back in 2012 things were not as good as they are today. You said the economy is, quote, "a disaster under Obama." Today the Dow hit 18,000. That is an all-time high. It is a number that a few years ago when I was covering Wall Street people thought was ridiculous, it was a joke, it would never happen. The economy in terms of the rate it grew just posted the best growth in a decade. The President's approval ratings has gone up four-points, in our latest poll, maybe as a result impart of that. If he got the blame then from you, are you willing to give him some of the credit?

GIULIANI: Yes. Absolutely. There are good parts to this recovery. And bad parts to it. And the market is one of them. The job situation is getting better. It still isn't what it should be. And it may be possible that we're not going to have the same kind of job recovery that we've had in prior -- in prior recoveries largely because, you know, technology is taking the place of people. And that makes companies more profitable so they can do really well on the market, but they are not necessarily producing the kind of jobs they were producing before. The market is no longer maybe a great indicator of job growth because sometimes you become more profitable because you have less jobs. Has our economy improved? Yes. Am I happy that the market is at 18,000 when so many middle class people's pensions, including most of the police officers that I work with, I run a security company, they are all very happy when they see it at 18,000.

We're not just talking about rich people, we are talking about a lot of pensions that are effective by that. And I do give him credit for that. I think the President is a good man, I think he is a good father. I think he does some good things. I don't think everything he does is wrong. But I do think -- and I think the President, and I would you plead with him to do this, I think the President has an opportunity to do something historic if he would speak out forcefully, as forcefully as he does about this Trayvon Martin and that Gates case as he does -- if he would speak out forcefully on the things that are needed to bring the crime rate down.

BURNETT: All right. Mayor Giuliani, thank you so much for your time.

GIULIANI: Thank you.

BURNETT: And OUTFRONT next, breaking news, North Korea's internet service once again failing. Was it the United States or did North Korea take it self-down.

Plus Sony defying North Korea, despite threats of more attacks, physical attack, Sony will release "The Interview" across America on Christmas Day. Will North Korea retaliate?

And this surveillance video capturing a man who allegedly smuggled more than 150 guns on the flights from Atlantis to New York, a lot of these guns, automatic, fully loaded, stashed in the overhead bin. How did he do it?

(COMMERCIAL BREAK)

BURNETT: Breaking news, Sony stuns the world by fighting back. Defying hackers and threats believed to be from North Korea. The Hollywood studio announcing it will release the interview in theaters across the United States on Christmas Day. Director and co-star Seth Rogen breaking his silence on twitter with the words, "The people have spoken, freedom has prevailed. Sony didn't give up!" He loves his exclamation point. "The Interview will be shown at theaters willing to play it on Christmas Day." Rogen's co-star James Franco posting on Instagram, "Victory, the people and the President have spoken!" Also loves exclamation point multiples.

Brian Stelter, senior media correspondent and host of "CNN'S RELIABLE SOURCES" joins me now. Brian, this is serious. When they finally announced that it was going to be in a couple of theaters but you have just gotten off the phone and now, this is going to be everywhere.

BRIAN STELTER, CNN SENIOR MEDIA CORRESPONDENT: Yes. One by one we've heard about these theaters today. It started with one theater in Austin and one in Atlanta and now it's snowballed, and now the numbers, 200 and I'm told actually it may get up to 300 theaters. Now that sounds like a lot. But this was going to be premiering in up to 3000 theaters. That's when the major theater were on board. But when they started to back out last week and when Sony told them they could back out last week, Sony ended up canceling the movie. Those big chains like AMC and Regal went ahead and scheduled other movies instead. So now we end up seeing the movie going to independently owned theaters. These are the Art House cinemas that we see in lots of major cities. I guess it's about 200 are now on board and those theater owners still have a few more minutes to tell Sony they want to play the movie so that's why we could see up to 300 get on board total.

BURNETT: All right. So, I'm glad you explained the arts theaters, which is why there aren't many of them but you could still get up to 10 percent without the big ones getting on board. What changed though Brian? I mean, you know, Sony was threatened with 9/11 style physical attacks on theater goers, not theaters, that's part of the reason, the theater chains all backed out but has something changed in terms of the threat assessment or are they just saying, you know, what? We're going to do it.

STELTER: There is still no reliable intelligence about any real threat, physical threat to these movie theaters. I think what's changes in a couple of things. One, you know, there was a lot of anger at Sony for canceling this movie, a lot of that action. Hollywood and at the White House. We saw the White House today come out and say they applauded the decision. When was the last time we saw the administration have to do that about a movie? You know, this has become such a political issue, such a controversial issue. And I think there was also probably some calming down, as people really thought about, what is the possibility of a physical attack at a movie theater and, you know, as I think as people reassessed that and as Sony reassess that, they came to the conclusion they should put this movie out in some way and take a stand. By the way, Erin, the next question is, is he going to come out online as well because Sony is telling theater owners, they do plan to put this out in some form on the internet. Maybe you can pay for it or watch it on Netflix. I think that deal might be announced tomorrow.

BURNETT: All right. Brian, thank you very much.

STELTER: Thank you.

BURNETT: And now our national security analyst Bob Baer, formerly of the CIA, retired FBI counterterrorism agent Tim Clemente and Gordon Chang, Daily Beast contributor, author of "Nuclear Showdown: North Korea Takes on the World." Okay, the question is, what's North Korea going to do about it. Gordon, you know, they've threatened physical attacks, that worked, they got what they wanted and now this is going ahead anyway, what will they do? GORDON CHANG, AUTHOR, "NUCLEAR SHOWDOWN": Yes. North Korea is

not going to take this lying down. Because, you know, they mold Sony not to get 2,700 fewer screens, they mold Sony to make sure this film didn't show it all. And so, I think we're going to see tax on Sony or release of more emails that they got in the first attack. They're going to go after the South Korean activists who tend to put, who want to put this DVD into North Korea by balloons and they'll probably go after the U.S. government. Maybe not on U.S. soil. But somewhere. I got to remember that the North Korean regime is probably unstable. We've seen executions already. We'll probably going to see much more in the way of Sony fallout in Pyongyang.

BURNETT: Well, certainly this -- to anyone who is able to see this story in North Korea, in the power circles at least, this is a big loss of face for that regime, Bob. You know, when I spoke to you last week, you said North Korea was capable of doing something like throwing a grenade in a theater. Do you still think that could happen?

BOB BAER, CNN NATIONAL SECURITY ANALYST: I think it could happen. I think they will going to act to this irrationally but we have to keep in mind that they don't have a network inside of the United States to speak of. You know, they are not like an Islamic terrorist group that has a lot of followers, a lot of believers. But I don't think they will going to take this lying down at all. I agree. The next colleague of mine was in Pyongyang about six months ago, and he said, ignore it guys, ignore it, and it will go away, no one is going to pay attention. And they were determined to keep this movie out of theaters and I think at the very least, we're going to see a lot of Sony emails out there, all are secrets that are going to come out and they'll probably make at least another cyber-bomb attack against another company.

BURNETT: So Tim, what do you think the U.S. government said or did to make Sony okay with this because clearly Sony's decision was forget it, we're not going to put this movie out? The thing that changed was public pressure and pressure from the White House but do you think anyone had to give them assurances on security or anything?

TIM CLEMENTE, FORMER FBI COUNTERTERRORISM AGENT: I don't know, I would think Erin that the security would have to be at the local level on a situation like this. Especially with individual theaters, mom and pop operations that don't have a big chain behind them, they don't have the budget for security. So I would hope in a lot of these jurisdictions, the local law enforcement authorities are in contact with the theater owners and just letting them know, hey, you know, a couple of our cops are going to come by each shift and either stand around outside, sit in their squad car or maybe come see the movie themselves. Just so he have that physical presence there to put the theatergoers at ease. I really don't believe that anything major will happen because most attacks are preceded by pre-attack surveillance and with only a couple of days' notice, there is not a lot of time to do that pre-attack surveillance on these individual theaters. So I think as a whole they are going to be pretty safe but you can never be too sure with the lunatic that we're dealing with in this case. BURNETT: So, Bob, when you said you think another American

company. What do you envision as a possibility? I know it is a hypothetical, but what do you think?

BAER: It could be anything just to let them know that they're going to keep hitting us. It could be, you know, I mean, like a target-like attack. Or Home Depot which were also attacked. All of these companies are vulnerable. The North Koreans have a very limited counter-strike capability. You know, they can't hit the United States, they can't hit us militarily, they may do something against South Korea. But I would just find with the nature of this regime, and it is lunacy, I agree with Tom, this is a theocracy and we've deeply insulted them with this movie. It sounds crazy to us, but that is the way they've taken it and we can't count on them having a rational reaction.

BURNETT: And Gordon, to this point, when you talk about a theocracy, it's a God that leaves the country. Kim Jong-un is the single most unpopular world leader in the United States, one percent approval rating and I'm sure the CIA wants to know who the one percent are, all right, but literally the most unpopular. But 27 percent of Americans believe that North Korea is not a threat. Seventy three percent say it is. But 27 percent say it isn't. That is actually rather high.

CHANG: It is very high.

BURNETT: Are those 27 percent wrong? How big of a threat is North Korea right now?

CHANG: You know, well, obviously these guys got ballistic missiles, they've got nuclear weapons, they have the intention probably not to use them but to have them to sort of as a deterrent. But they've reached out and they've killed 50,000 South Koreans in 2010. That surprised everybody. So these guys can really do things which we don't anticipate because it is, they think so different than the rest of us.

BURNETT: All right. Thanks so much to all of you. And of course, we all hope that this would be a very safe Christmas Day and we'll see the reviews of this movie which so far on the editorial front have not been so great.

OUTFRONT next, North Korea threatening the United States with attacks, thousands of times, more damaging than the attack on Sony. All right. If that's true, the question is, and how exactly did they hack into Sony. We have a special report, we'll see only on OUTFRONT, next.

Plus, a deadly winner storm. At least four have been killed by a tornado in Mississippi. That system is now slamming large parts of the nation with rain and wind. We'll going to have the latest citing in to the busiest travel days of the year.

(COMMERCIAL BREAK) BURNETT: Breaking news tonight: Sony defiant, risking an attack

on Christmas Day by releasing its movie about North Korea's dictator. At this hour, we know that 200 theaters across the country are taking on the challenge after North Korea threatened 9/11-style attacks in theaters. This as Internet monitoring company Dyn Research says North Korea is struggling to fix its Internet after it was shut down. We don't know who is behind the blackout at this time.

Kyung Lah is OUTFRONT. She's in South Korea for us tonight.

And, Kyung, what do you know?

KYUNG LAH, CNN CORRESPONDENT: Oh, what I can tell you, Erin, is that overnight, once again, North Korea's Internet went completely black, just like the night before. North Korea wiped off the global Internet map for about 31 minutes. And this morning here in Seoul, if you try to log on to the way North Korea normally communicates with the outside world, the state-run media Web sites. It is sputtering. They can't seem to get through.

So, what is it? Who caused it? What was it? That is the mystery.

The data tells us that they went off the chart, but what we don't know is exactly who did it.

Now, we've spoken to hackers, spoken to cyber intelligence people throughout the last couple of days. They are all suspecting that it's probably not the United States -- too small potatoes, too obvious. It's probably the independent hacker, because North Korea's pipe is so small and so limited, Erin, they are suspecting that a teen-ager could have done this very damage and probably repeating it every night -- Erin.

BURNETT: That is pretty stunning.

Now, Kyung, obviously, Sony deciding to go ahead and release this movie now in 200 theaters across the United States on Christmas Day after it was threatened with 9/11-style attacks. It's a significant development. What is the reaction in Korea?

LAH: We're hearing two different reactions. Just generally among the population, if you get a sense of what's happening more in television here in Seoul, people are praising it, saying, OK, it's about time Sony stepped up. Good job.

But then, we actually spoke to defector and we're getting a much more jubilant response -- fist-pumps in the air, if you will. They can't wait for this to get released in the United States because it signals to them that perhaps they would get a copy. They would like nothing better than to use it as psychological warfare in North Korea. They would love to get "The Interview" into North Korea, into people's hands, because for them, it is not a comedy. It is propaganda, propaganda to destroy what they call North Korea brainwashing of its people -- Erin.

BURNETT: All right. Kyung Lah, thank you very much. You've been covering the story live from Korea all week.

And the North Korea's Internet shut down just days after President Obama blamed the country for the Sony hack and warned of a proportional response. So, how exactly did hackers break into Sony's computer system? A question perhaps more crucial than any other at this moment.

And Tom Foreman is OUTFRONT with a special report.

(BEGIN VIDEOTAPE)

UNIDENTIFIED FEMALE: Take him out.

UNIDENTIFIED MALE: You want us to kill the leader of North Korea?

UNIDENTIFIED FEMALE: Yes.

UNIDENTIFIED MALE: What?

TOM FOREMAN, CNN CORRESPONDENT (voice-over): A hack such as the one on Sony can start with the list of names like the credits for a film, only this list would be of employees.

Hackers would scrutinize that list for people who work on the targeted company's computer network, sorting out their relationships with information from Facebook and LinkedIn, and even figuring out which projects they are involved with.

Security specialist Alex McGeorge helps companies understand how it works.

ALEX MCGEORGE, SECURITY SPECIALIST: Once you have a list of people that you think are going to have this level of access, that's who you then target for spear phishing.

FOREMAN: Spear phishing is when a hacker sends an e-mail to a specific person that seems to be coming from a legitimate colleague.

(on camera): And I look at it and because it's from someone I know, I open the e-mail. Not only that, because the subject makes sense, I then click on the attachment and that's critical, right?

MCGEORGE: Right. So, now, you are going to a web page that I designed. And as you notice, as it renders here, it's going to look legitimate.

FOREMAN (voice-over): But that Web site is installing malicious software, and in seconds the target's computer is under the hacker's control.

(on camera): And look at that.

MCGEORGE: That is your desktop --

FOREMAN: And now, my computer is showing up on your computer and can you see exactly what I'm up to.

MCGEORGE: Exactly right.

FOREMAN (voice-over): The hacker can read e-mails and look at projects, reports, budget and pictures and even record your every keystroke.

MCGEORGE: So, in real-time, I see exactly what you are typing on your screen and this is how get passwords.

FOREMAN: This is a simple version of what appears to be a much more elaborate scheme in the case of Sony.

MICHAEL LYNTON, CEO, SONY ENTERTAINMENT: Both the FBI and the experts who we brought in basically said that the malware was so sophisticated that 90 percent of American businesses would have fallen prey to what happened to us.

FOREMAN: And yet the cost of this hack may ultimately prove much harder to calculate.

(END VIDEOTAPE)

FOREMAN: In the end, all of this means it may be impossible for a company to protect themselves against any kind of a nation-state attack simply because nations are too big, too wealthy and have too many people to keep pressing that attack time and again until they break through -- Erin.

BURNETT: All right. Tom, thank you.

And with me once again, Gordon Chang, "Daily Beast" contributor, author of "Nuclear Showdown: North Korea Takes on the World."

All right. This attack was sophisticated. That probably doesn't surprise people. But, again, with the context of Kyung's reporting, right, you're talking about an Internet that is so fragile in North Korea that a teen-ager could hack into it and bring it down, yet the hackers that are trained in North Korea, wherever they're base right now, would be able to conduct an attack this sophisticated.

Can they bring down other companies, companies with perhaps much more sophisticated defenses like banks?

GORDON CHANG, "THE DAILY BEAST" CONTRIBUTOR: Yes, well, sure. And the problem is here is that attackers always have the advantage. You know, you can have very sophisticated software to try to prevent these things but, eventually, somebody gets through, because if you're going to successfully defend, you have to be right 100 percent of the time -- 100 percent of your employees have to never make a mistake. And so, you know, this is a very difficult tall task. And that's why it's really up to the U.S. government to protect American companies and American-based companies.

BURNETT: All right. So, in terms of what happened here, so far, Kim Jong-un has been silent on the Internet outage in North Korea. Somewhat surprising given that he usually is bellicose and the first to say something, and, of course, over the movie, they threatened 9/11-style attacks. They were, you know, very specific, very aggressive, and after that came out, they said there are bayonets, we're going to be taking down all sorts of other companies.

So, they have been aggressive about it. Why isn't North Korea blaming and threatening over the Internet outage in North Korea? Is that basically proof it's not the United States doing it?

CHANG: Well, I think that probably the North Koreans who are conspiratorially minded any way are thinking that it is us. And probably the same thing is true for their good friends in this, the Chinese.

You know, it very well may not be us. I think it is. But let's say it isn't, it doesn't really matter what is true. What matters is what the Chinese think and what the North Koreans think, and they are very, very focused on blaming the world's problems on us.

BURNETT: So, this question about North Korea and how fragile its Internet is itself, OK, so, it's one of the poorest in the world. It's obviously completely censored. They believe their leader is a god. This is something we haven't seen in the Western world in a thousand years.

Who within North Korea has the access, when you're looking at the 1,024 IP addresses in North Korea, who are those people?

CHANG: Well, it's going to be the Kim family. It's going to be senior generals and admirals, and it's going to be people in the security services especially. So, it's a layered group.

But the North Korean regime is essentially four groups. It's for the Kim family, the security services, the party, and the military. Well, at the top level of all of those, you're going to have people with unrestricted Internet access.

BURNETT: Unrestricted but obviously totally 100 percent monitored.

CHANG: Yes, and that's the reason why people probably are not going to view sites that are considered to be contraband.

And it's important, though, to understand that it's very tightly controlled. Everybody watches everybody else and you are absolutely right, you're not going to go on a site that is friendly to the U.S.

BURNETT: So, in terms of the U.S. response, what would be the most effective thing the U.S. could do if it was proportional? It would seem like taking down the Internet, I mean, that's not really it. I mean, doing something that could interfere with the nuclear program that you could with a virus, like the U.S. did with Iran would be more like it.

CHANG: Yes. I think the most proportional response would be to help the South Korean activists get DVDs of this movie, one or another, make sure it occurs, make sure this movie gets into North Korea, because that's exactly what they were trying to prevent, and that's the reason why they're going after Sony in the first place.

BURNETT: All right. Gordon Chang, thank you very much.

CHANG: Thank you.

BURNETT: And next, new surveillance video of baggage handlers smuggling guns and ammunition on flights from Atlanta to New York. We're talking about fully automatics, AK-47s, AR-15s. This capture is exposing a major, major hole in airline security. We have a special report.

And number of protesters in New York growing in Midtown Manhattan right now, demonstrating against police violence, shutting down a major shopping area on the day before Christmas Eve. That's next.

(COMMERCIAL BREAK)

BURNETT: Breaking news, back to our top story tonight: hundreds of protesters taking to the streets of New York City. Some chanting, "Hey, hey, ho, ho, these racist cops have got to go." Ignoring calls from the city's mayor to stop anti-police protests until the two policemen assassinated over the weekend are laid to rest.

Miguel Marquez is in the middle of these protests tonight.

And, Miguel, tensions are high?

MIGUEL MARQUEZ, CNN CORRESPONDENT: Yes. Look, those sort of chants are the things that are going to upset the rank-and-file police officers that are following this protest along. They have now broken into the street. This is Third Avenue and we're headed north and taking a left down 94th Street. They have been snaking through the city all night long, where it sounds like we're headed toward Harlem.

This crowd very upset that the death of two police officers has been used as an opportunity to try to stop these protests. They said they're going to continue to protest on what they see as police racism, something that NYPD doesn't like being called. But I can tell you that the police -- and I want to show, if just turn around here, Brian, the number of police officers here is enormous and they are trying to keep the protesters on the sidewalks. They have broken on to the streets at this point.

We are farther uptown now at this point, so it's not as big of an issue where we were before on 5th Avenue -- Erin.

BURNETT: And, Miguel, what is the feeling you get, we were saying there were some chants, at one point of, you know, "Hey, ho ho, the racist cops have got to go". What's the response of the police there trying to protect the protesters?

MARQUEZ: Well, amazingly, and I've been to the protests and they have chanted much worse as the police officers were walking alongside, calling them killers, asking how many kids they killed today, that sort of thing, basically trying to get under their skin. They clearly have the last couple of days. The chants tonight have been somewhat less, but they're calling them racist is not going to set well -- Erin.

BURNETT: They're not going to set well at all, but incredibly that you still see all this and, of course, they are side by side as the police are charged with protecting those people.

All right. Miguel, thank you very much.

We'll check back in with Miguel as he gets more.

But, obviously, a very significant story. The mayor has said to the protesters -- please, don't come out on the streets until the officers are buried. There was a great expectation that that would be honored and, obviously, significant that it is not at this hour.

OUTFRONT next, the baggage handler slipping past security, smuggling loaded guns into planes. We have a full report on exactly how.

And several tornadoes reported across the South today. Four lives lost. If you are one of the millions of Americans traveling tomorrow, we'll tell what you need to know about the first severe winter storm of the season, which, of course, is hitting right now.

(COMMERCIAL BREAK)

BURNETT: A former Delta baggage handler and four alleged accomplices have been charged with smuggling 153 guns, some loaded on flights from Atlanta to New York. Authorities say one suspect hid the gun, which included AK-47 assault weapons in his carry-on.

Rene Marsh is OUTFRONT.

(BEGIN VIDEOTAPE)

RENE MARSH, CNN AVIATION CORRESPONDENT (voice-over): One hundred and fifty-three firearms recovered, smuggled on board nearly 20 commercial passenger planes from Atlanta to New York. That according to federal investigators.

KEN THOMPSON, KINGS COUNTY DISTRICT ATTORNEY: They put guns on the plane this time. They could have easily put a bomb on one of those planes.

MARSH: Here's how authorities say it happened: Delta baggage handler Eugene Harvey with a backpack full of guns uses his badge to enter the secure area of the Atlanta airport, bypassing security check points. Most airport and airline employees like ramp workers and baggage handlers undergo security vetting and recurring background checks. But they do not go through daily TSA screening to gain access to secure and restricted airport areas.

The accomplice, former Delta employee, Mark Henry, clears TSA and arrives at the concourse. The two men communicate by text message and meet in an airport bathroom. Once inside, out of the camera's view, the guns are handed off.

CHAD WOLF, FORMER TSA OFFICIAL: The TSA, the airports and the airlines after 9/11 are there to prevent this type of incident occurring.

MARSH: According to prosecutors, Henry seen here in surveillance video boarded flights from Atlanta to New York with handguns, AR-15s and AK-47s. Some of the weapons, loaded. It was all part of a five- man operation.

THOMPSON: This gun can shoot through a car door, can shoot through an apartment door, can shoot through a bullet-proof vest. In November, Mr. Henry brought this gun on a Delta commercial airliner to New York.

MARSH: This kind of breach in security has happened before. In 2010, an American Airlines baggage handler helped smuggle 12,000 pounds of marijuana on board a flight to New York. In 2013, an airline employee sentenced after agreeing to smuggle a machine gun and cocaine on to a commercial plane. And a 2009 government audit says workers with access to secured airport areas is one of the greatest potential threats to aviation.

WOLF: Everyone who's involved in aviation and aviation security know that this is a gap and a vulnerability.

(END VIDEOTAPE)

MARSH: Well, Erin, I spoke with Atlanta's Hartsfield-Jackson airport today, and so far, they have not changed their security procedures. They tell me they are having conversations about possible changes, but there's no guarantee anything will change.

But the question is, if this is a known vulnerability, why don't all airports screen all employees and the answer may just come down to money and resources.

As for Delta Airlines, they are fully cooperating with investigators -- Erin.

BURNETT: Pretty incredible story. Rene, thank you.

And next, four killed by a tornado in Mississippi across the east, torrential rains, heavy winds. We'll have the very latest as millions of Americans head out on one of the busiest travel days of the year.

(COMMERCIAL BREAK)

BURNETT: Breaking news on this eve of Christmas Eve: severe weather is wreaking havoc for the record 99 million people traveling this holiday season. In Mississippi, a severe tornado killed four people and injured many more. Police there saying the situation is totally chaotic. They are still pulling people from the wreckage.

Here in New York, there are delays of up to an hour and a half. Earlier, two planes clipped each other on the tarmac at LaGuardia Airport on the bad weather. Already, more than 4,800 flights around the nation have been delayed.

Karen Maginnis is in our CNN weather center with more.

And, Karen, what can you tell us about this tornado? Obviously, as we now know, four people have lost their lives.

KAREN MAGINNIS, AMS METEOROLOGIST: Yes, this was devastating. And from the damage we did see, Erin, it looked as if we might see an EF3 or possibly an EF4 tornado, meaning, we were looking at pretty high winds across this region.

When the outbreak of storms occur right around 2:00 p.m. to around 3:00 p.m., that is Central Time, we were watching this cell just kind of skip along, and I'll show you that in just a second.

Now, this is pushing further to the east, where we have a tornado watch in effect until 11:00 p.m. That encompasses much of Alabama, portions of Georgia, also into Florida. Florida has their own set of problems tonight.

Take a look at this -- Columbia, that's the area. Marion County, they're saying widespread damage. We have reports of buildings heavily damaged. They said a day care was damaged. The kids were moved out into a bank but the day care facility was heavily damaged. No children were injured but lots of injuries to report around that region.

Then it just kind of skipped through Sumrall and then headed towards Laurel. And in Laurel, two fatalities reported there. Now, in Tallahassee, big thunderstorms being reported here in excess of six inches of rainfall and in Tallahassee, they say they are doing high water rescues because flooding has been so severe -- Erin.

BURNETT: And what are delays like at the moment at the airports? I mean, there's been a lot of people trying to travel home and flights have been canceled. Will they be able to get home in time for Christmas Eve with their families?

MAGINNIS: I can tell you that we have been watching the delays out of the Philadelphia Airport all day long. And no less than two hour delays all day since 7:00, and yes, the major airports out of New York City are affected as well. They're running about an hour, hour and a half, but for tomorrow, the rain is going to come down much more heavily. We're looking at significant rainfall across the Deep South.

So, all along this corridor, from Atlanta, two to four inches of rainfall possible, localized flooding a possibility as well, but we're not looking at a white Christmas for New York. We're looking at soaking rainfall. So, if you're traveling into or out of Newark and JFK, LaGuardia, Washington, D.C., and eventually into Boston, you're looking at significant rainfall.

However, Chicago is a different story. They are going to be in the cold sector of the system. Could see as much as six to eight inches of snowfall -- Erin.

BURNETT: Oh, just horrible for so many people.

Thank you so much, Karen.

And thank you for joining us. Be sure to set your DVR to record OUTFRONT so you can watch us anytime.

"AC360" begins right now.