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CNN TONIGHT

Federal Investigation Into An Odd Computer Server Relationship Between The Trump Organization And A Russian Bank; President Trump's Pick To Be His Ambassador To Russia, Jon Huntsman; Government Ethics Office Is Unhappy With The White House; Pamela Taylor Says Wall Is Not Going To Stop Illegal Crossers. Aired 11:00-12:00mn ET

Aired March 9, 2017 - 23:00   ET

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


(COMMERCIAL BREAK)

[23:00:46] DON LEMON, CNN HOST: Breaking new, unanswered questions about the largest private bank in Russia and the Trump organization and why President Trump made those wiretapping accusations.

This is CNN TONIGHT. I'm Don Lemon.

Sources tell CNN there's a federal investigation into a quote "odd computer server relationship" between the Trump organization and a Russian bank. Could it be the root of President Trump's infamous wiretapping accusations against President Obama?

Plus our man in Moscow. Jon Huntsman signs on for what may be the toughest job in the Trump administration, ambassador to Russia. We will talk about all of that.

But I want to get to the breaking new now. CNN's justice correspondent Pamela Brown is looking into it for us.

Pamela, what have you learned about the investigation?

PAMELA BROWN, CNN JUSTICE CORRESPONDENT: Well, Don, we have learned FBI investigators and computer scientists continue to examine whether there was a computer connection between the Trump organization and a Russian bank called Alpha Bank according to several sources familiar with this investigation.

Now, this is the same server mentioned in a Breitbart article that a White House official had sparked President Trump's series of tweets last Saturday accusing investigators of tapping his phones. CNN has told there was no FISA warrant on this particular server. The questions about the connection between the server and the Russian bank were widely dismissed four months ago as an attempt by Alpha Bank to block them. So we have learned that the FBI counterintelligence team, the same one looking into Russia's suspected interference in the 2016 election, is still examining it. And one official I spoke with said the server relation is seen as somewhat odd and perplexing. And investigators are not ignoring it. But the FBI has more work to do to determine what was behind the unusual activity on whether there was any significance to it. The FBI declined to comment and the White House did not respond to our request for comment -- Don. LEMON: Pamela Brown in Washington. Thank you for that, Pamela. I

appreciate it.

I want to bring in now CNN investigative reporter Jose Pagliery.

Jose, explain to us what was the so-called communications about?

JOSE PAGLIERY, CNN INVESTIGATIVE REPORTER: What's so odd about this supposed communication is that this Russian bank repeatedly looked up the very unique internet address of one particular computer server in the U.S. being used by the Trump organization.

In the computer world it's kind of like this. It is equivalent to looking up someone's phone number over and over again. It's looking up a contact information. So while there isn't necessarily a phone call, usually it indicates something that might be an intention to communicate.

Now, that's what we heard from several computer scientists. One particular group of computer scientists who looked at this obtained these leaked internet records. Records they were never, ever supposed to make public. And they were puzzled as to why a Russian bank was doing this. Was it trying to send an email to the Trump organization? They found (INAUDIBLE) but they couldn't tell.

Last summer during the Presidential campaign, the Russian bank looked up the address to this Trump corporate server some 2,800 times. To put that in perspective, that is more lookups than the Trump server received from any other source. So the only other entity doing so many lookups for Trump server was something called spectrum health. That's a medical facility chain led by Dick DeVos, the husband of Betsy DeVos. And if that name sounds familiar, it is because Betsy DeVos who was later appointed as the education secretary by President Trump. These two entities alone made up 99 percent of the lookups. The computer scientists we spoke to just found that weird.

Now, all of the corporations involved say they never communicated by email with the Trump organization. And they had different, sometimes competing explanations for the server activity. But they haven't provided any proof of what was going on and they don't always agree.

For example, the Russian bank thinks it was receiving Trump hotel email marketing last summer but we asked for proof and it couldn't provide CNN with a single email to back that up. Meanwhile, the American marketing company that would have been sending those Trump emails said it wasn't doing that at the time for Trump's organization. Alpha Bank for its part repeatedly stressed none of its top executives have had any affiliation at all with President Trump or the Trump organization.

In a statement to CNN they said neither Alpha Bank nor its principals, including Mikhail Fridman and Petr Aven, two top executives, have had any contact with Mr. Trump or his organization. So in essence, what we have got now is a potential computer link that remains a mystery.

[23:05:01] LEMON: Still a mystery. And a lot of this is just one other piece of the puzzle.

So Jose, I want you to stand by. I want to bring some other folks in. I want to bring in Russia expert Matthew Rojansky, the director of the Konnan Institute at the Wilson Center. Jack Kingston, former senior advisor to the Trump campaign and CNN national security analyst Juliette Kayyem and so as Steve Hall, retired chief of the CIA Russia operations.

Good to have all of you.

Stephen, I'm going to start with you. CNN sources are saying that this server activity is odd. What is your take?

STEVE HALL, CNN NATIONAL SECURITY ANALYST: It is odd. And at this point it's unexplained. I mean, until we get more information as to whether there are any packets flowing. Right now all we have is just this sort of electronic handshake, if you will, between this particular server in Russia from Alpha Bank and in the Trump server.

From a counterintelligence perspective, on the Trump side, what you have is sort of this continuing drumbeat of, you know, these incidents of contact and just encounters between the Trump campaign and team and the Russian side. Then on the Russian side, you have got Alpha Bank which, remember, this is not the first time we have heard about Alpha Bank. Alpha bank has also mentioned in the steel dossier, the 35-page dossier making some pretty startling accusations.

So you have got this on both sides. And the devil is going to be in the counterintelligence details to tease out what exactly is the nature of these contacts and these relationships? We just don't know yet.

LEMON: Congressman Kingston, when you hear that the FBI is continuing this investigation, to you does that fly in the face of what the White House is saying, that there is no reason to believe that there's a justice department investigation?

JACK KINGSTON (R), FORMER U.S. REPRESENTATIVE: Well, I think the FBI has been looking for it. I think everybody's accepted that. You know, I think the question that the White House might have is how long have they been investigating? You know, in terms of this computer, frankly if Alpha Bank was a front group for Russian espionage or Russian intelligence agency, it would make sense. They have tried to break into the RNC computers. I believe Comey said that in his testimony today. They did break into the DNC computers. And so to try to break into the Trump campaign any way they could, that could be consistent with everything else. When we find out what this really does --

LEMON: An attempt to hack, is that what you're saying?

KINGSTON: Yes. I think there's a possibility that's there is a great explanation.

PAGLIERY: Congressman, it's worth making a distinction here. We are talking about the largest bank in Russia. This is a respected bank. And so, it might be - look. It's possible that the communication that was going on here could be that hackers were trying to break into this Trump organization server, but I have not heard yet from any of the experts I talk to that the bank itself would have been trying to do this. So we should be making that distinction.

LEMON: Well, let's talk to a national security expert right now, national security perspective on this.

So Juliette, to you, what questions do you have about this data which is with connection to Russia and the Trump organization? Could it be a potential hack?

JULIETTE KAYYEM, CNN NATIONAL SECURITY ANALYST: Yes, but I want to put that -- that wouldn't be in my top five what it is. And we actually don't even know at this stage based on the reporting whether data was communicate order if it were just a whole bunch of pings and there might be a series of explanations.

But I disagree with Steve. That I think, look, this is another data point. And what's clear is that at this stage there's a whole lot of odd. That's what I'm going to say. It is a whole lot of odd. We tend to think of these cases as, you know, there is going to be a CSI type moment, right, the Eureka moment. Someone is going to find the email from Putin to Trump, you know, proving collusion. That's not going to happen.

What is happening, what we are seeing over the course of this investigation, is a whole lot of different pieces that are going to try to be put together that may lead across the spectrum from everything is benign and the Trump campaign or his people knew nothing of what was going on, to direct collusion.

Now, I'm not even at the direct collusion stage yet. But there's enough pieces over the course of the last four months that you can't sit here anymore and say, I can explain all of them away. And I think most people, that's why most people want an independent investigation or at least to have these investigations continue to try to put the pieces together.

LEMON: Jose, go ahead.

PAGLIERY: You know, it is worth noting that the computer scientists who looked at this data didn't come to any concrete conclusions here. They want an independent investigation. That's why they surfaced this, right. I mean, there is no evidence that these two entities were communicating. The idea here is just that they want someone to look at this.

LEMON: Before I --.

KINGSTON: Remember, wait a minute, remember they're looking at illegal information. They are looking at information that should not even be in front of them. So for us to be saying there's some kind of fairness arbitrator is ridiculous. And also to say that the bipartisan intelligence committees of the house and the Senate can't have a thorough investigation, or the DOJ, or the FBI, I think it's just partisan to always be talking and always go back to special prosecutor, special investigation as if there aren't good people who can look at this fairly.

[23:10:04] LEMON: Is it illegal information?

KINGSTON: It was leaked. And then you also hear people say, no, there was no FISA request. You can't tell people if there was a FISA request or not. That's part of the deal. You can have a room of 1,000 FBI agents, and only three of them will know if there actually is one or not.

LEMON: But I think if there is one -- go ahead. Go ahead Juliette, sorry.

KAYYEM: No, I think that's right. And I mean, I do agree with Jack. I mean, there's no reason to suspect that the least suspended intelligence committee, you know, is led by people who want to come to a conclusion. I think it's interesting that after their briefings with Comey, everything does go quiet. I think there's a commitment. I would urge the White House to stop communicating with the Republicans on those committees to get them to try to spin up stories, which happened just in the last two weeks because it's important for, you know, both jack's side of the aisle and for Democrats that the American public has confidence. Because once again, we are looking at the story in the context of stories coming out daily now.

And as I said, it's a whole lot of odd. I mean, that's all I can say right now. There is not going to be this smoking gun. But there's a lot of evidence that's leading towards something - something could have been going on and we need to come to a conclusion about it.

LEMON: Matthew is the Russia expert on this panel.

So Matthew, first of all explain Alpha Bank. What it means to the Russian people, what it means to the Russian government, to Vladimir Putin, and so on.

MATTHEW ROJANSKY, DIRECTOR, KONNAN INSTITUTE AT THE WILSON CENTER: Well, so the sheer size and significance of alpha bank, alpha group, which is a large financial holding company. This is like, you know, the bank of America of Russia. You find their ATMs and their branches on every street corner in Moscow and across the entire former soviet world in Europe. I mean, they are everywhere.

So the sheer size of this thing is part of why there would be many unanswered questions. It's not like it's such a narrow, boutique group that finding out, they are in communication with the Trump organization. Tells you what the nature of that relationship might have been. And this is a bank that could have been doing a million different things. So an investigation would probably reveal a little bit more. But as Juliette said, probably not a smoking gun.

I want to point out, there are two things we are not doing while we are having this conversation and doing an investigation. One is developing a policy toward Russia. And two is deterring anyone from doing any further hacking. Whether that's China or Iran or anybody else. It reminds me of, you know, you are speeding along the highway. You see someone else got pulled over by a cop and is being harangued by the cop. Well, you know, there's no cop waiting for you ahead so speed on by. And I think, you know, that we have got to do everything at once. We have got to walk and chew gum.

LEMON: All right, everyone. Stand by. When we come right back, we will continue this discussion.

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[23:16:20] LEMON: We are learning more tonight about Michael Flynn, the President's former national security adviser.

Back with me Matthew Rojansky, Jack Kingston, Juliette Kayyem and Steve hall.

So congressman Kingston, let's talk about Michael Flynn. He was fired for lying to the vice President about his connection with the Russian ambassador. And now, we have learn that he was working as a foreign agent for Turkey, paid more than $500,000 while he was working for the Trump campaign. And he just filed paperwork to make that official two days ago. It seems like that would have been important information for the American people to know. Don't you think?

KINGSTON: I think it would have been. But remember, he was fired not because of his connection with Russia, but because he lied about his conversation with Russia. Not because he lied about his connection with Russia. And that was the conversation in which he said he did not bring up sanctions, later it was shown that he did. And by the way, that was probably illegal to have him as a private citizen at that time, he was collateral damage you might say. And that was illegally leaked.

But nonetheless, he did mislead the vice President about it and that's why he was fired. But you know, I do think that scrutiny in terms of who have you been working for, who do you have connections with, I think that's all fair game for the President's staff. And that's just part of the scrutiny and transparency of public office.

LEMON: Does this sound like he was extremely vetted?

KINGSTON: It does not. And I think that everybody else has been and everybody else will be lessons learned.

You know what? One of the things, Don, about Trump coming as a business man, he doesn't try to rig things. And I'm not making the - you know, I'm not trying to go back to the election on that, through use of that word. But one of the things I know when I was in the house is that often we knew exactly what the votes would be on amendments before we brought it to the floor because we wanted to win every time. And that's the political way to do things. I think a businessman's way is, hey, I'm not going to have perfect. I'm going to try some things, some things are going to fail --

LEMON: Jack, what are you talking about? KINGSTON: Well, I'm talking about with some of his appointees, with

Mr. Flynn. But also the secretaries, army secretary, air force or navy --

LEMON: I think that's OK, Jack. Listen, I don't mean to cut you off and I don't want to be rude. I think that's OK when you are working in private business for yourself. You can handle your business the way you want to. When you are the President of the United States you are doing the American people's business. And especially when you say that people should be extremely vetted and that you are going to have the best team and do the best job, then you need to do that and not run it as a private corporation. That's not what the U.S. government is.

Go ahead, Juliette. I know you want to get in.

KAYYEM: Don, well, I talked to a bunch of people who know this law a little bit better than I do in terms of what was Flynn's obligation. That's a lot of money to forget, $500,000. He clearly either forgot or there are just, you know, there's a casualness about ethics, I would say, around Trump and his people.

But the more interesting thing is why did he decide to do it now? And most lawyers who know this law suspect that the FBI is -- that he is cleaning up his house. That he has lawyers that are saying, you need to get your house in order. It is like paying back taxes when you are about to be nominated for something.

LEMON: You're talking about Flynn?

KAYYEM: Talking about Flynn. That it's very -- that the reason why he did it now, he is out of the limelight, he doesn't have the job, is actually because he needs to clean up his background because either there's an investigation or things are ongoing.

We have long suspected that Flynn is part of all this Russia stuff. And so it is just -- the timing has to be discussed. Why all of a sudden does he wake and up say, I forgot that I was an agent of a foreign power. And so likely at least people who have this experience, people who come forward, it's like paying your back taxes before you're nominated.

[23:20:15] LEMON: Well, the whole thing about the wiretap communications was that because of Flynn. He was speaking to the Russian ambassador and he happened to be picked up from them monitoring the Russian ambassador.

You were nodding your head as she was speaking, Matthew. Why so?

ROJANSKY: Well, look. The whole notion of the conversations with the Russians being so sensitive, so much so that someone could get fired, it's a little strange. It's clearly the lying that's the problem. And it's clearly, you know, ethics vulnerabilities within the administration to be the problem.

Talking to the Russians and having a policy towards the Russians are smart things to do both for diplomacy and during a campaign. I mean, Hillary Clinton had a Russia team. So what you would have wanted backstopping Flynn and anyone else senior in the administration who is going to have contacts with the Russians or anybody else after January 20th is a policy. And people to execute that policy. And I think part of the problem with Flynn was he really was very much out there on his open. He was freelancing. He was having conversations, and he wasn't being well briefed.

LEMON: Here's the question, Steve. I mean, we know that Flynn will speak at an RT conference in 2015. He sat with Vladimir Putin at the event. If he was working on behalf of Turkey during the campaign, is it conceivable that he could have been working for Russia too?

HALL: Well, first let's get to the idea of this extreme vetting you were talking about. How about extreme common sense? I have to agree, the conversations with Kislyak are probably not that big of an issue. He probably just got a little bit of ahead of himself and then ended up lying about it, which didn't end well for him. And of course, there was the integrity issue.

But when you go to Russia, as an intelligence officer, this guy was intelligence officer for most of his career. And seems somehow to think that it's OK to go to Russia, it's OK to sit next to Vladimir Putin, which doesn't happen by accident. It's OK to get paid and associate with RT, which is a propaganda outlet of the Kremlin. I mean, how do you miss that? How do you figure, yes, this is the guy who I want, you know, to be doing this?

It is just -- that to me doesn't make a lot of sense. Could he have been working, you know, for the Russians as well? I would have been -- I was asked recently, you know, if you had that magical spy, that great penetration inside the Kremlin, what would you ask?

One of my questions would be, what actually happened, you know, in Moscow when he was there with RT that was off-camera? That was not taken pictures of? Would there private meetings? We don't know. We just don't know about that. But now that the stuff with regard to Turkey is coming out, I mean -- it's just difficult to tell. We don't know.

LEMON: Thank you, everyone.

Up next, President Trump's pick to be his ambassador to Russia was a fierce critic during the campaign.

(COMMERCIAL BREAK)

[23:26:44] LEMON: President Trump picking Jon Huntsman, a former critic, to be his ambassador to Russia which just might be one of the toughest jobs in the administration.

CNN's senior diplomatic correspondent Michelle Kosinski has more -- Michelle.

MICHELLE KOSINSKI, CNN SENIOR DIPLOMATIC CORRESPONDENT: Hi, Don. Right, so you have hacking, Syria, Ukraine to deal with. And Jon

Huntsman is a former governor, former ambassador to China. But what really jumps out at you over this news is the fact that not only Huntsman criticized Donald Trump in the past, he actually called for him to drop out of the Presidential race.

The other thing, Trump must have a very good reason to get past that. You can see some of the things that the administration would get out of this choice.

(BEGIN VIDEOTAPE)

KOSINSKI (voice-over): Former Utah governor Jon Huntsman, President Trump's choice for ambassador to Russia, could now be a key player in one of the U.S.'s most complicated relationship. A choice made all the more unusual because Huntsman has his own complicated relationship with Mr. Trump.

Last spring the moderate Republican said he could support Trump for President, but in October Huntsman changed his tune. After the release of the "Access Hollywood" tape of Donald Trump saying lewd things about women, he called for Trump to drop out, telling "the Salt Lake Tribune" the campaign had become a race to the bottom, that the time has come for governor Pence to lead the ticket. Huntsman made waves in the GOP in 2009 when he accepted President Obama's offer to join his administration, a move some saw as a brilliant political play.

THOMAS BLURR, THE SALT LAKE TRIBUNE: Jon Huntsman is rumored as a possible opponent for President Obama. And so, what did President Obama do? He named him to be the ambassador to China.

KOSINSKI: Huntsman took the job but later quit and ran in the Republican primary anyway. At the time Trump was critical, trashing Huntsman on twitter. Jon huntsman called to see me, I said no, he gave away our country to China. Trump also calling him weak, a lightweight, and easy pickings. But after Donald Trump won the White House, Huntsman appeared to fend minutes.

JON HUNTSMAN, FORMER AMBASSADOR TO CHINA: We talked by phone. We have exchanged thoughts and ideas. I congratulated him on the race. And I wished him the best of success.

KOSINSKI: So why pick Huntsman now? Well, the President has passed on hiring many of his critics, including Elliot Abrams and Mitt Romney. He has also opened the door to some rivals tapping South Carolina governor Nikki Haley as U.N. ambassador despite her opposition to him during the campaign.

In Huntsman, the Trump White House gained someone with respected foreign policy chops. A two-time ambassador who has also led a group critical of Vladimir Putin. A win for a White House opponents fear could be too cozy with Russia. Others say this could also be politics.

Huntsman once interned for Utah Senator Orrin Hatch, but lately was said to be considering running against him. Could President Trump be taking a page from President Obama's old playbook?

BLURR: The joke at the time was keep your friends close and your enemies in China. The President needs Senator Orrin Hatch. He is chairman of the finance committee. He is going to be very integrally involved in all the health care stuff, on the tax reform. So I guess what you do is you keep your friends close and your enemies in Russia.

KOSINSKI: Hatch, who said today Huntsman was not going to run against him, has gone to bat for Trump in the past, helping him get his cabinet picks approved. Now, as the longest-serving Republican senator, his seat might just be safe. Huntsman gets a big job and Trump gets his ambassador to help him deal with Putin.

(END VIDEOTAPE)

[23:30:11] KOSINSKI: Huntsman has described himself as an independent thinker. But you have to wonder if he is confirmed, how much would his personal views and experience even play into his work when so much of foreign policy right now seems so deeply centered within the White House? Don.

LEMON: Michelle Kosinski, thank you very much.

I want to bring in now CNN political commentator Shermichael Singleton, and Republican political consultant and Presidential historian Timothy Naftali.

So Timothy, Jon Huntsman has some rough things to say about the President. And we all know the President Trump takes criticism very harshly. But Huntsman is said to be getting, you know, this ambassador job. So other critics have gotten the boot. What's going on here?

TIMOTHY NAFTALI, CNN PRESIDENTIAL HISTORIAN: Don't know. It's a big deal. Not only is the former governor -- ambassador Huntsman -- a critic, former critic of Donald Trump, he is chairman of the Atlantic council. This is an organization that was set up in 1961 to defend NATO and to defend the Atlantic alliance. He is a pro-NATO person. And Donald Trump's about to send to Russia someone who is very supportive of an organization that both Donald Trump and Vladimir Putin don't seem to like.

So it's not just a question of Donald Trump moving outside of his comfort zone to choose a former critic. He is actually choosing somebody whose ideas about Russia are fundamentally different from his own. This makes this choice very interesting. And one wonders whose idea it was.

LEMON: Yes.

SHERMICHAEL SINGLETON, CNN POLITICAL COMMENTATOR: I couldn't agree more. I mean, Don, what I'm beginning to wonder is perhaps the President is attempting to strike a tone with Republicans that have vehemently disagreed with his position as it pertains to Russia. And so, maybe by nominating Huntsman as ambassador to Russia, this is an attempt to say, hey, I understand you guys is fear. Calm down a little bit. I'm going to nominate someone that you guys may like.

LEMON: OK. But I want to know why some and not others. Because I said to people who -- critics who have gotten the boot, case in point you were a critic who got the boot because you lost the job at HUD because you wrote an op-ed that was - been critical of the President before the election. Here is part of you early said.

This individual recognized a moment of great disparity in the Republican base and like cancer attacked and spread, consuming everything in his path. Trump has taken us to a new moral low where it is acceptable for a Presidential candidate to mimic and mock someone with disabilities. Donald Trump's statement about women are appalling and despicable. There is no way anyone can defend what is clearly indefensible.

So what were you told when you were fired, that you couldn't be critical?

SINGLETON: Come on, Don, we have gone through this. Look, I have no idea.

LEMON: People don't tune in every single night.

SINGLETON: OK, fair enough. Fair enough. Look. I have no idea why the administration and how they choose who they want to get rid of, and how they choose what critics they want to keep. I will leave that to them. That is at their discretion. But however, I can understand why some people in the outside looking in say, well, this seems hypocritical. You got rid of some of those folks. And some of these folks criticize you. Why are you allowing them to be part of the administration? And I will let people to come up with their own opinions and thoughts about that.

NAFTALI: Well, it wasn't just Shermichael. Elliot Abrams also didn't get the job.

LEMON: Yes. Well, let's talk about Elliot Abrams. He also turn away Elliot Abrams, the number two spot for the state department, because Abrahams was critical of him before the election. This is an article for "the Weekly Standard" I want to read from.

He said, do not allow the Republican convention to be a coronation wherein Trump and Trumpism are unchallenged. There is no reason others who won many delegates from Rubio to Cruz to Kasich should not have their names put in nomination. The party needs to be reminded that there are deep divisions and Trump needs to be reminded of how many in the party oppose and even fear his nomination.

So that cost Abrams dearly. But it did cost the President, I think, and the secretary of state, because Abram has lots of foreign policy and national security --

NAFTALI: One of the problems right now that is there's a vacancy sign over much of the federal government. Because Donald Trump is having a hard time recruiting people for middle-tier positions. If he continues to say, anybody who is against me, anybody who signed never Trump or no Trump petition, cannot be in my government, he is going to have a hard time.

LEMON: But here is what he said. He still has hundreds of key jobs, right, senior level jobs at every federal agency. And he said in a recent interview, you don't need all those jobs. And then his chief strategist Steve Bannon said, one of the President's goals is deconstructing the administrative state. Does he understand what it takes to run a government?

SINGLETON: You know, well, look. He is new to this. He is a political novice. So hopefully as time goes on he will learn. That is my hope. I think that's fair to say. But Don --.

LEMON: Because I had a nickel for every time I hear that.

SINGLETON: You would probably be rich, right? Bu look. I think, Don, it's important for the President to understand that this is not sustainable. You cannot sustain not hiring people that have criticized you because there are legitimate people who are extremely experienced at some of the positions --

[23:35:09] LEMON: You think he's thin-skinned?

I will leave that for people to make that --

NAFTALI: I will leave that for people to make that decision.

LEMON: Please, you are here. Come on.

SINGLETON: Don, I think --

NAFTALI: Ask me.

LEMON: You think he's too thin-skinned?

SINGLETON: I think the President's temperament is problematic at certain times and he needs to work on that. And I think that's fair to say.

NAFTALI: I think he's temperamentally unsuited, but he can continue to learn.

Here is the thing about the Huntsman nomination. It's not just getting a critic for the administration. It's a critic that's going to go to Moscow, a very sensitive position. This is very interesting. The Russians are probably very unhappy about this. And they are thinking to themselves, how are we going to talk to President Trump? Because Huntsman is not the kind of intermediary that Putin would want to have. Much better for the country, but not so great for Trump. And again, this choice to me is a little baffling but a good for the country.

LEMON: But again, getting back to what he did, as you say, to his credit, he appointed a critic or is said to be appointing a critic of his. But from the travel ban, right, that rolled out as a disaster, health care is a mess right now, other missteps that we hear about. Is this a simple competence issue or maybe incompetence issue? SINGLETON: I think personally what we are witnessing right now is an

administration that is new to politics, that's still trying to figure its way out around D.C. And Don, I think it's only been, what, 48, 50-plus days now. We haven't reached 100 days. I would like --

LEMON: It hasn't been?

SINGLETON: I would like -- wait a minute. I would like to give some level of benefit of the doubt. But I do believe that as time goes on, the expectation is for the President and his administration to act more like former administrations in the past. And we have yet to see that.

LEMON: Fair enough.

NAFTALI: Government, the federal government is a big organization. They still haven't adopted an understanding. They haven't shown an understanding of this being big organization. That's a problem for them. The travel ban rollout was a disaster in part -- not simply because they misunderstood the constitutional side of it, but they didn't understand that you had to worry about every border, and every airport because they didn't think big. It's going to take them awhile.

The question is whether Bannon and the people who think like Bannon are actually capable of helping Trump understand the size of the federal government that has to exist. Yes, you can cut it here and there. But ultimately it's a big organization. So far we don't see the Trump administration really getting it. Maybe it will happen. But so far they haven't.

Remember what I said. We said don't need all those jobs. And then Steve Bannon said that they are deconstructing the administrative --

SINGLETON: Well, reality will set in for them really soon, I can promise you that.

LEMON: Thank you, gentlemen.

SINGLETON: Thank, Don.

NAFTALI: Thank you.

LEMON: When we come right back, why the government ethics office is unhappy with the White House. And it's had something to do with Kellyanne Conway.

(COMMERCIAL BREAK)

[23:41:54] LEMON: The government ethics watchdog is unhappy with the White House for not punishing Kellyanne Conway after she gave a free plug to Ivanka Trump's fashion line.

Walter Schwab, the director of the office of government ethics, telling the White House in a letter today he is concerned with what he calls Conway's misuse of position. I want to discuss this with Richard Painter, the chief White House

ethics lawyer under George W. Bush.

Richard, good evening. Thank you for coming on. We have talked about this a lot. But let's re-watch that moment that got us here and Sean Spicer's initial reaction.

(BEGIN VIDEO CLIP)

KELLYANNE CONWAY, WHITE HOUSE COUNSELOR: Go buy Ivanka's stuff is what I would tell you. I hate shopping and I'm going to get some on myself today. It's a wonderful line. I own some of it. I fully -- I'm going to give it a free commercial here. Go buy it today, everybody. You can find it online.

UNIDENTIFIED MALE: Sean, questions have been raised after Kellyanne Conway did an interview, I believe it was with FOX News this morning, where she appeared to, from the confines of the briefing room, promote the products of Ivanka Trump. Do you believe that she crossed an ethical line?

SEAN SPICER, WHITE HOUSE PRESS SECRETARY: Kellyanne has been counseled and that's all we are going to go with.

(END VIDEO CLIP)

LEMON: So Richard, you were clear from the very beginning that this was an ethical breach. Today, the office of the government ethics responded to the White House saying, I remain concerned about Miss Conway's misuse of position, not taking disciplinary action against a senior official under such circumstances risks undermining the ethics program. I am more concerned about the extraordinary assertion that many of the OGE's regulations are inapplicable to employees of the executive office of the President. The assertion is incorrect and the letter cites no legal basis for it.

So Richard, have you ever seen anything like this?

RICHARD PAINTER, CHIEF WHITE HOUSE ETHICS LAWYER UNDER GEORGE W. BUSH: No. This is ridiculous. What the White House ethics lawyer did really in the first week or two he was on the job is write a letter over the office of government ethics telling them that because the White House is not technically an agency, that all the government ethics rules that refer to the word agency don't apply to the White House staff. Basically that -- because the White House is not an agency, I guess they can be a bunch of sleaze balls and not follow any of the ethics rules. That makes absolutely no sense.

We never would have argued that in the Bush administration. Anybody said that would have been laughed right out of the White House. And nobody in any other administration has claimed that. In effect, they are saying that the White House staff doesn't have to comply with the ethics rules that apply to the entire rest of the executive branch, that it's going to be lawless over there, and that makes absolutely no sense. Kellyanne Conway's not the only one who was getting into the fight

with Nordstrom's. So was the press secretary, Mr. Spicer, he was getting into it as well. And bashing on Nordstrom's on behalf of the President and his daughter.

This whole thing has gotten way out of hand. And the White House needs to acknowledge at least that the rules that apply to everyone else in the executive branch also apply to the White House, which they clearly do.

[23:45:01] LEMON: So what would you have them do? Because Jason Chaffetz and Elijah Cummings of the house oversight committee also received today's letter. What would you have then do? What would you like to see them do?

PAINTER: I think they need to have a hearing and call the White House lawyers in there and ask them what they mean when they say that because the White House is not an agency, that the ethics rules don't apply to the White House. And why they have taken a position that's different from every other White House and which rules specifically they don't intend to comply with. I think this is of the utmost importance to find out if there's going to be any ethics at all in this White House because so far I'm not impressed.

LEMON: I know that this is on your long list of concerns about this White House. What is at the top of your list, Richard?

PAINTER: Well, part of the problem is the tone at the top. That the President says that the rules don't apply to him. And the President can't have a conflict of interest which is absolutely false. The President, of course, can have a conflict of interest. But if he says that and that he is going to keep his businesses despite the conflicts of interest. And the payments from foreign governments that violate the emolument clause of the constitution. And that he is going to be tweeting out accusations about his predecessor without any evidence whatsoever. I mean, if he's going to conduct himself this way, the staff looks at that and says, well, I guess we can do anything we want. And then the White House ethics lawyer jump in and said, actually, maybe you can, because none of the rules apply to you. I mean, this is an awful situation.

LEMON: I'm out of time, Richard. Our time is short. Thank you so much. I appreciate you joining us.

When we come right back, President Trump still promising to build that wall on the border. But what do people who live there think? I'm going to talk to one of them.

(COMMERCIAL BREAK)

[23:50:43] LEMON: President Trump's tough talk in immigration maybe having an effect on the border where illegal crossers are down. But what about the President's proposed wall?

I want you to listen to what Pamela Taylor thinks. She has lived along the border for decades. (BEGIN VIDEO CLIP)

PAMELA TAYLOR, LIVES ALONG THE BORDER: That are wall is not going to stop them. If it's 20 feet high, they will get a 21 foot ladder, right?

(END VIDEO CLIP)

LEMON: And Pamela Taylor joins me now.

Pamela, thank you so much. That's kind of conventional wisdom from a lot of people that, you know, if you have a 20-foot wall, though, there is a 21-foot ladder that can help get over it. But your house right now is right there in the border. You can actually watch undocumented immigrants cross into the country from your home. According just released customs and border protection numbers, illegal southwest border crossings were down by 40 percent last month. Have you noticed a difference?

TAYLOR: Yes, we have.

LEMON: Why do you think fewer people are crossing? Is it due, do you think, to President Trump?

TAYLOR: I believe President Trump is making a difference already.

LEMON: And so, why do you think fewer people are coming over? You are seeing fewer people? Tell us about that.

TAYLOR: Basically it was a constant flow of people coming over. Not one and two, but by 20s and 30s. And now we actually get a good night's sleep every once in a while. We don't have any interference. Of course, I can't speak for the border patrol. They are probably picking people up, but not in such large quantities.

LEMON: You say that you had the wall - this wall has been at your house for almost ten years at your house.

TAYLOR: Correct.

LEMON: And you said nothing changed. Although, you support the President, you think the idea of a wall is a silly idea?

TAYLOR: If this wall that we have now which has been there basically since 07 and all the millions of illegal immigrants that are in America now evidently the wall didn't work.

LEMON: So even with border crossings plummeting for whatever reason whether it's the President's or whether it is the economy is doing better in Mexico, whatever the reason it is, do you think there is less reason for a wall? And do you still think that we need more border patrol agents at this point?

TAYLOR: Yes, we definitely need more border patrol agents. But I can't say personally, my idea is we don't need a fence. It's not working. We can use that money for education, for everything. We have veterans right now that are living under bridges, that are walking the streets and begging. We have people that have worked so hard to have homes and they can't afford the mortgage. I mean, we need to start thinking about America first.

LEMON: Do you have a sign that reads we are part of America. We need representation and protection, not a fence. Where you display that sign? Is that sign in your yard?

TAYLOR: We started putting that sign up in 07. Because our representatives here, they were not behind us. No matter who we wrote to, no matter who we spoke to, we didn't get a response. Even now, our representatives are not with us. They are constantly encouraging people basically to come into America. We cannot afford to have them.

LEMON: How are they encouraging people to come to America?

TAYLOR: Most of the people that are coming across now are children. Those children in my opinion are just a ploy. Children are being used in World War II. They have been used in Vietnam. And they are using these kids so that once these children are in America, then later on mama is going to have to come, then later on papa is going to have to come. And so, I just see these children being used as a ploy to get other people into America.

[23:55:04] LEMON: What I find that is interesting is you voted for President Trump. You believe in strong border security, but you do leave water for the border patrol agents. You leave water for the migrants. You even given migrants some clothing in such to help them. That's an interesting position to be in. Explain what that's like and why you do it.

TAYLOR: I do not agree with what they are doing because as soon as they cross that border line into America, they have already broken the law. But, on the humanitarian side, you cannot say I will not give water or food to a person that is hungry or thirsty.

LEMON: Pamela Taylor, thank you.

TAYLOR: You are welcome.

LEMON: That's it for us tonight. Thanks for watching. I will see you right back here tomorrow.

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