New York City Building Linked to WMD; Governor's Lawyer Pushing Back; Charities Suffer from Madoff Ponzi Scheme
WOLF BLITZER, CNN ANCHOR: I'm Wolf Blitzer. You're in THE SITUATION ROOM. A 36-story New York City office building allegedly linked to weapons of mass destruction. Now, the Feds are moving to seize parts of the building's ownership, alleging a connection to Iran. Let's to go CNN's Brian Todd. He's working the story for us -- Brian, what is this alleged connection?</s>BRIAN TODD, CNN CORRESPONDENT: Wolf, U.S. officials believe part of that building's ownership is a front for a large Iranian-owned bank. And they say that bank set up a scheme to channel money to Iran's nuclear program and its military.</s>TODD (voice-over): Blending into the landscape in Manhattan this office tower, with only an address as its public face, becomes a financial target for U.S. officials. They're saying 40 percent of the ownership in (ph) this company, saying it's part of an elaborate scheme to funnel money to Iran for its nuclear program.</s>STUART LEVEY, TREASURY UNDER SECRETARY: The Iranian government has been engaged in a pattern of deceptive practices to fund its support for terrorism and to pursue its nuclear and missile programs.</s>TODD: The company getting some of the rental money for this building is called the Assa Corporation. U.S. officials say Assa is a front for Bank Melli -- Iran's largest state-owned financial entity. U.S. and European Union officials designated Bank Melli last year as a proliferator for supporting Iran's nuclear and ballistic missile programs and funneling money to the Revolutionary Guard and Quds Force -- considered terrorist groups by the U.S. An Iranian official at the U.N. had no immediate comment on the latest moves against the property in New York, but last year, Bank Melli issued a statement denying involvement in any deceptive banking practices. How much money generated at this address might have gone to support Iran's military programs?</s>LEVEY: I am not in a position to give that kind of a figure, other than to say I think that sort of intuitively, obviously, this is a large commercial property on Fifth Avenue.</s>TODD: One conservative analyst applauds the move against the property assets, but says more can be done to pressure Tehran over its nuclear program.</s>TODD: And specifically, that analyst says that Iran buys gasoline from outside Iran -- from at least five European and Indian- based companies. And he says that those companies also have assets in the United States. He says the U.S. government could pressure them to stop doing business in Iran. But Stewart Levy at the Treasury Department says for now, they're going to focus on entities that support what he calls more illicit activities -- Wolf.</s>BLITZER: That's a huge building, Brian. What about the tenants in that building? Could they be kicked out? What do we know about -- what about this part of the story?</s>TODD: They don't seem be implicated at all right now. Stuart Levey at the Treasury Department says those tenants have done nothing wrong and they have no reason to worry. The only thing that will change, he says, is that 40 percent of the interest of the Assa Corporation in that building has now been blocked. But the money that it generates -- that rental income, essentially -- is now directed into a blocked account.</s>BLITZER: Brian Todd, thanks for that story. The lawyer for the embattled is Illinois governor pushing back this afternoon, calling hearings on possible impeachment "unfair and illegal." The attorney for Rod Blagojevich was at the statehouse today and blasting representatives there. Our CNN national correspondent, Gary Tuchman, has been working the story for us -- Gary, what is the latest?</s>GARY TUCHMAN, CNN NATIONAL CORRESPONDENT: Well, Governor Rod Blagojevich, Wolf, may eventually resign some day, but it's not going to be imminent. His lawyer telling us today they plan to fight. And remember, the lawyer telling us that this Friday he may make the governor available to talk to reporters for the first time since his arrest. Inside this building behind me, the state capital of Illinois, impeachment hearings going on. And that's why Ed Genson, the lawyer, was here. And he's angry. He says he hasn't heard these audiotapes and he can't defend his client. But he gave us a germ -- and I emphasize a germ of a possible defense for criminal proceedings. He basically said, hey, the words on this tape, they're dumb, they're inappropriate, they're jabbering, but nothing happened. He says illegal actions actually didn't take place.</s>ED GENSON, BLAGOJEVICH'S ATTORNEY: We also haven't seen the wiretap. We haven't seen how many you conversations there were. We haven't seen whether these were taken out of context. We haven't seen if they were accurately described. We haven't seen whether, in fact, there were conversations that show a withdrawal of the statements that were made. We haven't seen any of this.</s>TUCHMAN: So Genson is saying he has a tough time defending his client. But under Illinois law, a crime does not have to be proven to impeach and convict someone. It's just basically if you're a sleaze, they can kick you out. Now, he was asked -- the lawyer -- if the governor will come here and testify. He says he hasn't decided yes or no. And, Wolf, this guy Genson, a really interesting character -- a very well-known an attorney for 44 years. And I never heard this before. Some people produce his name "Jenson." Some say "Genson"</s>BLITZER: I've heard that from people in the past. All right, Gary, keep working the story. Thank you. Meanwhile, we're getting a clearer picture right now of the staggering losses from that pyramid scheme allegedly run by a former Wall Street player named Bernard Madoff. And it's not only personal fortunes that have been wiped out -- many charities, especially Jewish organizations, have been financially crushed. Let's go to CNN's Ted Rowlands. He's working this part of the story in Los Angeles for us. A huge impact on some of these charities out there, isn't there -- Ted?</s>TED ROWLANDS, CNN CORRESPONDENT: Yes, Wolf. In excess of 30 Jewish charities probably hit by this. They're still really trying to sort all of this out. But what Madoff allegedly was able to pull off has had a dire effect on Jewish charities in Southern California. People are upset this happened in the first place. They're also upset that a Jewish man could do this to Jewish charities.</s>ROWLANDS (voice-over): Movie mogul Steven Spielberg and Jeffrey Katzenberg's charity lost millions, according to "The Wall Street Journal," to Madoff. No comment so far from Spielberg, a giant in the Los Angeles Jewish community, whose list of mega hits, of course, includes the Academy Award winning "Schindler's List." Another victim, the Jewish Federation of Los Angeles, a charitable organization that lost $6.4 million to Madoff. The Federation invests through the Los Angeles Jewish Foundation, which manages several Jewish charities' assets. They lost about $18 million total. Federation Board Chairman Stanley Gold says Madoff's alleged ability to deceive notwithstanding, he still wants some answers as to how this could happen.</s>STANLEY P. GOLD, JEWISH FEDERATION OF GREATER LOS ANGELES: He clearly was a pretty good con artist to accumulate this amount of money from this many people. You h to acknowledge that there was a big con going on. But the question is not whether how many and who else. The question is, did the people who invested the money do the appropriate amount of due diligence?</s>ROWLANDS: The part of the story that's hard for many to comprehend is the fact that Madoff, who is Jewish, appears to have openly stolen from Jewish charities.</s>GOLD: Unfortunately there's bad guys in all kinds of religions. And, unfortunately, he was Jewish. And, unfortunately, he did defraud a fair amount of Jewish charities. It's sad, is all I can really say.</s>ROWLANDS: And, Wolf, a lot of people, quite frankly, are just in shock over this still and the ramifications of it. They're going through to find out exactly how he was allegedly able to pull them off -- pull this all off. We should note, of course, that Madoff has cooperated with investigators, according to federal authorities. His lawyer says that he will be fighting all and any charges very vigorously -- Wolf.</s>BLITZER: And it's not just Jewish charities in Southern California. In Florida, right here in Washington, and in New York -- all over the country, a lot of these charities are in real, real trouble. Some of them have already shut their doors as a result of this. Ted, thanks very much for that report. Let's go to Jack. He's got "The Cafferty File" -- it's amazing, Jack, what's going on here.</s>JACK CAFFERTY, CNN ANCHOR: I have just a quick question before I get to my question. You know, if the New York City Police Department arrested a drug dealer, you know, with some crack/cocaine in his pocket, they'd take him out to Rikers Island and throw him in a cell with a couple of hundred people and let him rot there until it's time for his trial. This clown is accused of stealing $50 billion from people, he is placed under house arrest in his $7 million Park Avenue apartment in New York City. Can you explain that to me?</s>BLITZER: I can't. But he's out on $10 million bail, which apparently he could post.</s>CAFFERTY: All right. It's amazing. All right. The vice president -- I have other questions. Vice President Dick Cheney gave an interview to ABC's Jonathan Karl in which he defended the administration's decision to invade Iraq, the war on terror, waterboarding, GITMO and much more. Yesterday, you'll recall, President Bush gave a similar interview to our Candy Crowley. There's only 34 days left now for the administration and both men are reflecting on the past eight years and, perhaps, thinking about their legacy and how they might be remembered. It's a time to talk up their accomplishments in the hopes that critics' attention will be diverted from the other stuff. Bush and Cheney are leaving Washington in the middle of two wars and the worst economic downturn since the Great Depression. There is certainly no shortage of memories of our 43rd president -- everything from speaking at ground zero following the 9/11 attacks -- perhaps his finest moment -- to the time he choked on a pretzel and fainted while watching Sunday night football. And then there's the vice president. He has redefined the role of the nation's second in command. He will long be remembered for that. But he'll also be remembered for shooting his quail hunting companion in the face in 2006. So here's the question: Who will history be kindest to, President Bush or Vice President Cheney? Go to CNN.com/caffertyfile and you can post a comment on my blog -- Wolf.</s>BLITZER: We'll see. History is unique. We'll see what history can do. All right, Jack. Thanks very much. The secretary of State weighs in on the infamous shoe throwing incident in Baghdad. Condoleezza Rice says we -- meaning the news media -- we got it all wrong, she says. Plus, her big regret from the past eight years -- her one-on-one interview with Zain Verjee. That's coming up. Plus, Barack Obama has promised transparency and now says he's frustrated because of something he can't release to the American public -- at least not yet. You're going to hear about it in his own words. That's coming up. And new tactics will now be allowed to battle those pirates. Could the U.S. military be involved? Stay with us. You're in THE SITUATION ROOM.