The Rachel Maddow Show, Transcript 6/20/17 GA-6 Election

Guests:
Tim O`Brien
Transcript:

Show: THE RACHEL MADDOW SHOW
Date: June 20, 2017
Guest: Tim O`Brien

CHRIS HAYES, MSNBC HOST: THE RACHEL MADDOW SHOW starts right now.

Good evening, Rachel.

RACHEL MADDOW, MSNBC HOST: Good evening, Chris. Thanks my friend.
Appreciate it.

HAYES: You bet.

MADDOW: Thanks to you at home for joining us on this hour on an exciting
night. Tonight, we`re watching two congressional elections play out. One
in Georgia, one in South Carolina. Polls closed as you know at 7:00 p.m.
Eastern Time.

Four Republicans left seats in the House of Representatives in order to
become officials in the Trump administration instead. That opened up all
of their seats, right? All four of those people represented districts that
were not necessarily swing districts, that are considered red districts,
Republican districts.

But the special elections that we`ve had so far in the Trump era to replace
those four people who left the House in order to join the administration,
those have been interesting races so far. Republicans held on to both Ryan
Zinke seat in Montana, which is a statewide race, and the Mike Pompeo state
in Kansas. But in both of those cases, voters swung double digits in the
Democrats` direction.

Compared to November`s election results, the Democrat in the Montana
district did like 14 points better than the presidential race had gone for
Democrats in that state. In the Kansas race, the Kansas Democrat did 20
points better than the Democrats had done in the presidential results in
that district. So, a 14-point Democratic swing, a 20-point Democratic
swing. In both of those cases, though, those seats were Republican enough
that even swings that much in the Democrats direction were not enough to
flip the seat and the Republicans ultimately won both of those races in
Montana and in Kansas.

Now, tonight, it`s South Carolina and Georgia. And South Carolina, it is
considered to be another race that on paper at least would be very hard for
a Democrat to win. This is a race to fill the seat that was vacated by
Trump budget director, former South Carolina Congressman Mick Mulvaney.
When it came to the presidential race in that district in November, Trump
won there by 18 points.

Now, tonight, this is the results that we`ve got so far, in that South
Carolina race. Again this is the 5th congressional district. Ralph Norman
is a real estate developer. He`s the Republican candidate in the race
right now. He`s at 51 percent. The Democratic candidate in the race is
Archie Parnell.

This is a significant portion of the vote in here, 71 percent of the vote
in. But it`s a three-point race between them. Again, this was a district
that Trump won by 18 points. Right now, with 71 percent of the vote in,
the Republican in that race is only winning by three points.

Now, it`s an interesting district. Republican Mick Mulvaney held that seat
comfortably for, I think, three terms. But before him, as recently as
2010, this seat in South Carolina, House district 5 was held by a Democrat,
held by a centrist Democrat named John Sprat. Democrats nationwide did not
spend heavily in this South Carolina race, on behalf of their candidate,
Archie Parnell. It has been a sleeper race compared to what is really the
marquee event tonight.

This is the race in suburban Atlanta, Georgia`s 6th district. This is the
seat that was previously held by Donald Trump`s controversial health
secretary, Tom Price. Now, Democrats in contrast to that South Carolina
race, Democrats really have thrown in as much as they could to try to help
their Democrat candidate in Georgia Sixth, Jon Ossoff. He`s running
against Republican Georgia former secretary of state, Karen Handel.

Now, tonight is actually a run-off election in Georgia. There was a first
round in April. Eighteen different candidates ran. Democrat Jon Ossoff
won by such a large margin that he almost won the seat outright then and
there that night, instead of having to go to this runoff tonight. For want
of two more percentage points in that first race in April, he was
ultimately forced into tonight`s run-off by him and Karen Handel.

And everybody – you know, it`s interesting. Read a lot of the nationwide
commentary on this today and I think everybody is really focused on how
much effort Democrats have put into this race, and they certainly have,
everything from party money to prominent Democrats getting involved in
doing what they can to activists all over that district, all over that
state and in some cases all over the country, pulling for Jon Ossoff.

But Republicans have bent over backwards for Karen Handel as well, in a
race that Republicans you wouldn`t think would have to work this hard to
win. But Karen Handel has had in-person visits from national Republicans,
including House Speaker Paul Ryan and from the president himself who also
recorded robocalls and wrote tweets in support of Karen Handel`s campaign.

This district in Georgia encompasses the northern suburbs of Atlanta. It`s
considered a solidly Republican district for years. It`s been held by a
Republican since 1979.

The last time there was a congressional seat – a congressional race in
this district back in November, Tom Price won reelection by 24 points.
Before Tom Price held that seat, it was held for two decades by former
House Speaker Newt Gingrich.

It`s a Republican seat. But Georgia 6 is also an affluent well-educated
district. They only went for Trump over Clinton in November by the narrow
margin of less than 2 points. In terms of what`s going to happen tonight,
it`s really anybody`s guess. For what it`s worth, I should tell you that
the 6th district in Georgia was pounded by really quite torrential rain for
much of the day. Who knows if that will affect Election Day turnout.

We also know there was heavy turnout in early voting, people who voted
before Election Day, today. But in a special election like this, with
unprecedented amounts of spending in this race and national attention and
local dynamics, nobody is quite sure how to extrapolate from that big early
vote to what the vote results will be at the end of the night tonight.

Obviously, it is still early. As it stands right now, there`s about 46
percent of the vote in and it couldn`t be any closer. Karen Handel at 50.2
percent, Jon Ossoff at 49.8 percent.

Look at the raw numbers to see. It`s just less than 500 votes between them
at this point out of more than 120,000 votes cast. So, right now, super
tight, but again, not yet half of the vote in.

For a better look at what`s happening and whether or not we can logically
extrapolate from the vote that we do have in, we`re going to bring in now
our election board guru, the great Steve Kornacki. He will be honchoing
the big board throughout the night as we get these results.

Mr. Kornacki, thank you for being here.

STEVE KORNACKI, MSNBC: Sure. Election night, I love these things.

MADDOW: I know. You`re good at these. Tell us what we can tell from the
results so far.

KORNACKI: We can – well, we can see some interesting signs here. And if
you`re a Democrat, if you`re a Jon Ossoff supporter, some ominous signs.
So, yes, Karen Handel right now in the razor thin margin, leading the vote
that we have.

But take a closer look at the district. Here`s what you have to be worried
about if you`re a Democrat looking at these results right now. It looks
like the vote that is left to come in is disproportionately going to be
from right here, from Cobb County.

This is the conservative heart of the base. This is the votes that were
being tabulated right now that were cast today in Cobb County, Karen Handel
is leading by 16 points. And this is also a county, you look at these
three, this is where you`re probably proportionately speaking, you`re
probably going to have the highest total of same-day votes.

Where Ossoff got into the lead earlier tonight when we were looking at some
of these tabulations, he has had a very big margin. He got over 60 percent
of the early vote in DeKalb County. However, the same-day vote that we`re
seeing right now, and this goes true across the district, Handel doing
better in the same day vote than she did in the early vote.

And so, again, if you`re Jon Ossoff, the bottom line right now in these
returns, we will see what happens as we get more. But you probably wanted
to see a bigger number in the early vote. You probably – he got 60
percent in DeKalb. He probably wanted to be up 64 percent, 65 percent,
somewhere around there in the early vote.

He actually was under 50 percent in the early vote in Fulton County. He
probably wanted to be winning that outright. And again, as I say, a small,
proportionately speaking, a small early vote here in Cobb County, we`re
starting to get the same day now, and Handel running at 58 percent in the
same day.

So, all of those signs right now – I`ve been talking to some Republicans
who feel good about this. If you`re a Democrat, you`re nervous. But
again, there are still a lot of votes out there. It`s a volatile
situation. We`ve never seen a special election like this before for a lot
of reasons.

So, we shall see. We`ve certainly been surprised on this set before on
election nights. And one other, we can quickly tell you, you put it up
there in South Carolina, here to South Carolina 5th district, again, the
Republican leading by three points. Republicans I think feeling a little
better about this one just –

MADDOW: Steve, let me interrupt on that. I have just been told that “The
Associated Press” has actually just now called that race in South Carolina
for the Republican, for Ralph Norman.

KORNACKI: Yes, and that was – again, the area that was outstanding, we
had one Republican county, we had no votes from it all, and also the Rock
Hill area, outside Charlotte, Republican bastion. Look like a lot was to
come there. So, it looks like this thing is going to tick up if this got
to a 6, 7-point win for Norman in this district.

But, again, as you say, this is a district – you know, last year, you were
upwards of 20 points in the congressional election, in the presidential
election in this district. So, it`s one Democrats will certainly want to
brag about getting closer. But, of course, the other story tonight is
Republicans have been saying, hey, Democrats, when are you going to put a
win on the board and again that comes back to Georgia. We shall see in the
votes come what happen there.

MADDOW: And, Steve, let me just underscore what you said about on this
Georgia race. When those Fulton County numbers started coming in, that`s
when it seemed to me like Democrats got most shaky in terms of what they`re
expecting from Ossoff. Did they expect that Ossoff would not only be ahead
in Fulton County, but that he`d be ahead by a lot?

KORNACKI: Yes, here`s the bottom line if you want to break the numbers.
Fulton County is almost half the district in terms of all the votes coming.

MADDOW: Yes.

KORNACKI: Now, it is also the closest to a sort of a swing county of these
three. If you`re a Democrat, your target overall in Fulton County was 50
percent. You wanted Ossoff to crack 50 percent. If he didn`t get there,
we`re talking 49.8, 49.9 percent. You wanted to be at 50 percent in all of
the votes in Fulton County.

Now, if you`re a Democrat, you`re saying, hey, our advantage is going to be
early votes. We have more motivated voters, better organization. We`re
going to run up a bigger score in the early vote. It will come down as the
same day comes in.

Here`s the problem. In the early vote, at least in the in-person early
vote, this doesn`t count the mail-in ball lots, 48.6 for Ossoff. So, I
think the expectation from Democrats was, you`re north of 50 percent in the
early vote, it comes down with the same day. Instead, they got 48.6
percent in the early vote. And in the same day that we`re seeing, at least
in the precincts we`ve seen so far has had Karen Handel leading in the same
day.

So, that`s an ominous sign and again, as I say, the fact that Cobb County I
think disproportionately sort of underrepresented at this point.

MADDOW: Steve, let me ask you one last question on this, if there was a
turnout effect from the bad weather today in the district, does that have
any partisan implications that you could foresee in terms of what was
expected for same day election day voting rather than the early vote?

KORNACKI: Well, and potentially. It all depends. This is anecdotal and
we`ll see when the results come in. There have been anecdotal reports, and
I`ve heard some Republicans saying this, that the turnout in DeKalb – this
is the Democratic heart, this is where if you`re Ossoff, you want to be
getting 60 percent, 61 percent, 62 percent of the vote. You`re expecting
that. He got 60 percent in DeKalb in the early vote.

There have been reports that the turnout here in DeKalb less than expected.
That could be a same day. You could attribute that to anything. We`ll see
if that turns out. But that`s something else.

Obviously, if you get into an election like this where it`s going to be
decided probably by a point or two, you could also blame anything,
whichever side you end up on.

MADDOW: Exactly. And when it comes to turnout, we always find that
whatever we say about the anecdotal information we`ve got about turnout on
Election Day, weeks later when we finally get the real turnout, the
detailed turnout numbers, it always turns out what you can see on election
day, it doesn`t really –

KORNACKI: Take it with a huge grain of salt.

MADDOW: Yes, exactly. Anecdotes are worth as much as, you know, as far as
you can throw them.

Thank you, Steve. We`ll be checking back in with you as we continue to get
results.

KORNACKI: Sure.

MADDOW: Let me tell you that we have got the “A.P.”, “Associated Press”
calling the race in South Carolina tonight. Again, that`s the race to fill
the seat vacated by South Carolina Republican Congressman Mick Mulvaney. I
told you a moment ago that “A.P.” projected that Ralph Norman, the
Republican, would win that race.

NBC News also now projecting that Ralph Norman, the Republican candidate in
South Carolina`s 5th district, will be the winner of that race. Now,
that`s cooked in terms of that having a projected winner. It will be
interesting to watch these numbers, though, as they continue to come in,
even though there has already been a call. And that`s because Democrats
will be watching those margins.

This was a very Republican district. This is not a district that Donald
Trump won by one or two points. He won comfortably by double digits in
that race. Parnell right now was able to come in very close to Ralph
Norman there. That will be an instructive thing for Democrats,
particularly because they did not spend very much to try to help him,
unlike in Georgia 6th where both sides have now spent so much, that in
Georgia, that is the most expensive congressional race that has ever been
conducted in our country.

All right. So, we`re going to continue watching the results from the
voting tonight, especially now in Georgia right. But I – I`ve also got
some other news to bring you, including this late breaking news from “The
New York Times.” Plus, we got an exclusive tonight about something that`s
about to get very, very uncomfortable in part in court concerning Trump and
his business ties. That`s all ahead tonight.

Stay with us.

(COMMERCIAL BREAK)

MADDOW: So, we`re keeping an eye on the results from the voting tonight in
Georgia`s 6th congressional district. Repeating the news from just moments
ago, “The Associated Press” and NBC News haven now called result, have now
projected a winner in the other special election tonight. The one held in
South Carolina. Both the “Associated Press” and NBC News projecting that
the Republican in that South Carolina race will win.

But I also want to bring you some breaking news tonight as we`re continuing
to watch these results come in from Georgia. We got some breaking news
late tonight from “The New York Times” and it concerns CIA Director Mike
Pompeo.

Mike Pompeo has been an increasingly interesting figure in the Trump/Russia
investigation. One of the key allegations related to possible obstruction
of justice by the president, which we`re now told is the subject of
investigation by special counsel Robert Mueller, one of the key allegations
about obstruction of justice is that the president may have asked the
director of national intelligence, Dan Coats, if he would intervene with
the FBI to try to stop their Russia investigation.

Now, when that was first reported this month by the “Washington Post”, “The
Post” also reported that CIA Director Mike Pompeo was in the room, he was
in the Oval Office with Trump and the Director of National Intelligence Dan
Coats when the president allegedly made that request, that Coats should
intervene with the FBI.

Now, that`s interesting in terms of trying to corroborate that allegation.
If Mike Pompeo was the witness to it, presumably, investigators would want
to hear him to know whether or not he could corroborate that allegation.

Well, after that story came out, we reported on this show that the leaders
of the Senate Judiciary Committee had asked CIA Director Mike Pompeo
whether the White House had ever talked to him, whether the White House had
ever talked to anybody at the CIA about the FBI dropping the investigation
into General Flynn.

We reported last week that CIA Director Mike Pompeo missed the deadline for
responding to that question from Congress. He just did not respond.

Well, tonight, we have this brand-new reporting from “The New York Times”
about CIA Director Mike Pompeo and Trump national security adviser Mike
Flynn. It concerns the question of what happened during the 18 days
between the time when the acting Attorney General Sally Yates warned the
White House that Mike Flynn was vulnerable to Russian blackmail. What
happened the 18 days between when Yates gave that warning and when the
White House finally fired him.

Well, this “New York Times” headline tonight, quote, despite concern that
Flynn could be blackmailed, he was still privy to CIA secrets. That tells
you a big part of what they`re reporting tonight. The paper gives this
timeline, quote, Mr. Pompeo was sworn in three days before Sally Yates went
to the White House. He testified last month that he didn`t know what was
said at that Sally Yates.

By that time, though, CIA officials had attended meetings with FBI agents
about Mr. Flynn and had reviewed the transcripts of Flynn`s conversations
with the Russian ambassador. That`s according to several current and
former American security officials. Intelligence officials knew as Sally
Yates later told Congress that they were looking at a, quote, compromised
situation. A situation where the national security adviser essentially
could be blackmailed by the Russians, continuing from “The Times” report
tonight, quote, Mr. Trump waited 18 days from that warning from Sally Yates
before he fired Mike Flynn.

During that period, Mike Pompeo, director of the CIA, continued to brief
Mike Flynn and the president. He continued to deliver the president`s
daily brief, that highly classified intelligence briefing every day for
every one of those days to the president and to Mike Flynn.

Now, if CIA officers had been privy to not just the warning from Sally
Yates that she gave the White House, but if CIA officers were also privy to
the specific intelligence that led to that warning, if they, as “The Times”
reports, had actually reviewed the transcripts of Flynn`s conversations
with the Russian ambassador that he was apparently not telling the truth
about, if the CIA had that granular level knowledge about what Mike Flynn
had done wrong and what he had been lying about with regard to his contacts
with the Russians, then why did the director of the CIA keep giving him the
most secret information in the government, for nearly, well, nearly three
weeks?

Well, the White House went on including General Flynn in that top secret
daily briefings, right, conducted for the president by CIA Director Mike
Pompeo all that time. So, now, the question, did Mike Pompeo personally
know the concerns about Mike Flynn when he continued with those briefings?
Did the CIA director know there was a compromised situation for the
national security advisor as Sally Yates described it, while he kept giving
that potentially compromised official very secret information?

“The New York Times” tonight reports one unnamed administration official
says that whether or not Mike Pompeo knew personally about the concerns
about Mike Flynn, he hadn`t told the president about those concerns.

This is very serious stuff. It has remained sort of an interesting, at
least for me, an increasing point of focus as to why Mike Pompeo has not
been asked directly in open session about these things that he was
apparently in on as this very serious stuff unfolded at the White House,
these allegations about Dan Coats and now, these questions about why he was
still giving the PDB to Mike Flynn. He has not really been asked directly
about this stuff under oath in open session in Congress.

I don`t know if there`s a reason behind that, but maybe that will change.
This is serious stuff. This is our nation`s most classified and closely
held intelligence. Why was it still going to that guy?

We`ll be right back.

(COMMERCIAL BREAK)

MADDOW: In the year 2000, on March 2nd of that year, nearly 100 federal
agents fanned out in the predawn hours and they made arrests of 11 people.
Some of them were high-profile people in a bad way.

The day after those arrests, the federal prosecutor in the eastern district
of New York, a prosecutor who would go on to become attorney general of the
United States, Loretta Lynch, she unsealed the indictment in that case that
had led to all of those arrests. And that led to an excellent day of New
York tabloid headlines like this one. Borscht boys and Goodfella in $40
million stock swindle say feds.

Borscht boys and goodfellas? That was “The New York Post” headline.

In terms of national attention and national headlines for those arrests, it
certainly did not hurt that literally the night before all of the arrests,
the night before all of those federal agents fanned out and arrested all
the alleged mobsters in this case, the night before the arrest, the TV show
“Law and Order” aired an episode about the exact thing that was alleged in
that indictment. On March 1st, I kid you not, “Law and Order” ran an
episode about something going horribly wrong on Wall Street and it turns
out the mafia is behind it.

Then, in real life, the very next day, there were all of these arrests of
mafia figures for a Wall Street fraud scheme. And then the day after that,
the real deal federal indictment in that case got unsealed and it spelled
it out like a “Law and Order” plot. It spelled out all of the details
about this $40 million fraud scheme orchestrated by the Russian and Italian
mob.

And the kind of fraud this was, it`s called a pump and dump scheme, which
I`m happy to tell you has nothing to do with breastfeeding. Basically
these guys would pump up the value of what was basically an intrinsically
worthless stock, they would pump up the value of the stock by fraudulent
means, often by hyping it to like elderly investors or otherwise vulnerable
people by, you know, kicking back money to brokers who were able to
fraudulently convince their gullible clients that they should buy this
worthless junk.

The idea was to pump up interests in these bad stocks. And then when
enough false demand was generated for these worthless stocks, when enough
people were buying this worthless junk that its price started to go up,
then con artist, the mobsters would sell their share of that worthless
thing.

And the thing was inherently worthless. Once they stopped artificially
pumping up its value, they had already have cashed out, but all of the poor
schmucks that they conned into buying it, in order to pump its price,
they`d be left with something worthless. Mobsters make off with the money.
All of the old gullible people get screwed.

That`s the kind of financial fraud that is hard to commit alone, if you
think about it, right? One person can rarely do enough con artist touting
to push up the price of a junk stock, right? You need – you sort of need
a bunch of people working on this in concert. It has to be an organized
crime. And it did become an organized crime activity.

The guys arrested in and named in the indictment back in 2000 included the
brother-in-law of Sammy the Bull from the Gambino crime family, and another
guy from the Bonanno crime family and from the Genovese crime family and
from the Colombo crime family. The indictment was explosive about how
these Italian mafia figures were in the stock fraud part of it, and they
also, quote, availed themselves of the muscle offered by La Cosa Nostra
when it came to settling disputes that arose in the course of this crime.

It was a very mobbed up enterprise, but it wasn`t just the Italian mob.
Remember “The New York Post” headline was borscht boys and goodfellas.
What they mean by that is it wasn`t just the Italian mob. This scam
according to the feds and the according to the arrest sheet was a joint
operation between the Italian mob and the Russian mob.

And the Russian mobsters, according to prosecutors, they came in handy for
this pump and dump scheme in particular because they were the ones who had
great access to off-shore bank accounts and they were the ones that had
great money laundering skills.

And so, they were the ones who had to be involved in this thing to launder
all of the profits. Borscht boys and goodfellas.

One of the borscht boys who was indicted in that round up back in 2000 was
a guy named Felix Sater who at the time had already done some prison time.
Few years earlier, Phillip Sater had broken a margarita glass at a Midtown
Manhattan bar. He smashed the glass on the bar top and then took the stem
of a margarita glass and jammed it into a guy`s face. The guy needed 110
stitches to hold his face together after Felix got done with him.

So, Felix Sater did a year in prison for that assault. But it`s
interesting. When he and all those other guys got picked up in the mob
stock scheme years later in 2000, this $40 million fraud, with all of these
marquee named mobsters, it`s interesting. Felix Sater didn`t actually go
to prison for that. I mean, they got him for it. He pled guilty, but they
didn`t sentence him in conjunction with that $40 million stock fraud. They
didn`t sentence him with it even after they got his guilty plea. They
didn`t sentence it for it for more than a decade. At the end of the
decade, he didn`t get any jail time and he just paid a little fine.

There`s interesting reports about what he did during that decade and why
the government waited a decade to sentence him and why at the end of it,
they didn`t put him in prison even though they got a guilty plea out of him
for a mob related $40 million swindle. I mean, there was a whole bunch,
there have been a whole bunch of interesting stories about what happened in
that decade.

There was the story about him knowing about stinger missiles that were for
sale on the black market in Russia. Stinger missiles, those shoulder fired
missiles that can take town a helicopter or an airplane, right? The ones
that the U.S. famously covertly supplied to the mujahideen fight the
Russians in Afghanistan. He supposedly told the U.S. authorities about a
bunch of stinger missiles being for sale on the black market and then
helped authorities buy those missiles off of the black market so they
wouldn`t get bought by terrorists instead. There`s lots of reporting about
how that`s part of what he was up to.

When Loretta Lynch was confirmed as attorney general, she was asked about
that mysterious mob stock swindle pump and dump case from her time as U.S.
district attorney in the eastern district of New York. She was the lead
prosecutor in the office that ran that case. She explained in the written
responses to the questions that she got about it, she was up to be
confirmed as attorney general, she explained that while prosecutors did
hold off sentencing Felix Sater for more than a decade after he plead
guilty, it was for a good reason. She plead that over the course of the
decade, he became a very valuable informant to them, an informant who gave
prosecutors, quote, information crucial to the conviction of over 20
individuals, including those individuals responsible for committing massive
financial fraud and members of La Cosa Nostra. The mafia.

Now, this has been a matter of some controversy. All of the different
parts of it have been controversial and they`ve all been through court.
The initial pump and dump scheme, the initial borsch boys and goodfellas
fraud, that was a $40 million fraud and there were real victims of that
fraud. This isn`t like, you know, some insurance company doesn`t make its
dividend because they had to pay – this is like real human beings lost
their life savings because of this fraud. Real people were defrauded.

And a guy convicted of felony charges in that case gets off with no prison
time for it and a tiny fine, which one might surmise is a small proportion
of the amount of money he made off of that crime. And he gets no
punishment out all for more than a decade while she stayed free after
pleading guilty? I mean, that`s obviously controversial. There`s been
tons of litigation about that.

There`s also the matter that the prosecutors kept so much so secret about
this case for so long. That was a point of controversy when Loretta Lynch
moved up from the prosecutor`s office to become attorney general. And
there`s been litigation just about the secrecy in this case as well. But
now, this story that has been intriguing from the beginning, right? This
story that has been an interesting like Wall Street story, an interesting
New York story, an interesting mob informant story, an interesting Russia
money laundering story, an interesting law enforcement story.

Now, it`s intriguing on lots of levels, but now, it`s about to become a big
national politics story because in that decade between all of those mob
guys getting arrested, the borscht boys and goodfellas indictment, in that
decade between those guys all getting picked up because of that fraud case,
in that that decade between those arrests and Felix Sater pleading guilty
to charges in that scheme, in that decade between him pleading guilty and
him finally a decade later getting sentenced, in that decade where he
wasn`t getting sentenced because the government was using him as an
informant. They were keeping him out in the wild so he could inform on the
mob.

In that decade that they kept him out there free, not in prison informing
on the mob, the other thing he was doing was real estate deals with Donald
Trump, at least three of them. A would-be tower in Phoenix that never got
built. A tower in Ft. Lauderdale, Florida, that did get built and then
went into foreclosure. And also, Trump Soho complex in New York City which
also get built but also went into foreclosure at one point.

And whether or not you`ve ever read anything or followed anything about
this part of the sort of Trump story, the Trump business story before, it`s
about to become a bigger story. It`s about to become a much more familiar
story for two reasons. Number one, today, Ron Wyden, senator on the
Intelligence Committee, announced that he`s giving up a hold that he had
placed on the Trump administration`s nominee to head up the financial
crimes unit at the Treasury. He says he`s giving up that hold because the
financial crimes unit at the Treasury has finally agreed to hand over to
Senate investigators on the Trump-Russia case. They finally agreed to hand
over the financial records that they have at Treasury which may be relevant
to the Trump-Russia investigation.

Ron Wyden today telling us that he got briefed this morning by the Treasury
Department on documents that are getting transmitted from Treasury over to
the Senate. Senator Wyden telling us, quote, I believe these documents
will be sufficient to start following the money.

By which he means, quote, financial connections between Trump associates
and Russia and Trump`s own business dealings with Russian interests.

In reporting on those developments today, and Ron Wyden dropping that hold,
saying he`s getting those documents, ABC News today cites sources familiar
with the investigation in reporting this. Quote, one of several areas of
interest for the investigators has been the pool of investors who helped
finance construction of the Trump Soho building in New York City. Several
names associated with the financing effort have alleged ties to money
laundering or Russian organized crime.

So, that`s the first reason this is about to become a big story, because
this Senate is yanking on this thread of the story. And according to
Senator Ron Wyden, they are finally getting documents from the financial
crimes unit at the Treasury that will allow them to follow that up. That`s
one.

Second reason, this is about to become a big story, is because a federal
racketeering lawsuit, a RICO lawsuit against Felix Sater`s company in which
he partnered with Donald Trump, that RICO lawsuit has been allowed to go
forward now. And the former employee who has brought that RICO lawsuit
against Felix Sater and his former company in which he partnered with
Donald Trump, the RICO lawsuit, the guy who brought that RICO lawsuit is
telling a reporter named Tim O`Brien at “Bloomberg News” that when Felix
Sater and his company put together the financing for those Trump projects,
including Trump Soho, they had a very specific explanation internally at
their company for why they had to take some foreign financing for the Trump
projects and why they had to turn some other foreign financing down.

Quote, the ex-employee said in an interview that a competitor of the FL
Group also contacted him to invest. When he took that offer to Felix Sater
and the chairman of Sater`s firm, they told him, he says, that they had to
take FL`s funds for deals they were doing with Trump because that
investment firm was, quote, closer to Putin.

Why did you have to take the money that was closer to Putin? Tim O`Brien
from “Bloomberg News” is just reporting that tonight. We`ve got an
exclusive first look at that reporting. He`s going to be joining us in
just a moment.

But if his reporting proves out, in between the racketeering lawsuit that`s
going ahead and the Senate investigation of the financial documents they`re
getting from the Treasury as of today, the investigation that Robert
Mueller is leading as special counsel whose staff, I should tell you, now
includes the former fraud chief at the Justice Department who was involved
in the prosecution of Felix Sater for that pump and dump mob stock scheme
all of those years ago.

If this new reporting from Tim O`Brien proves out about Russian money
pouring into Trump properties and coming from sources close to Putin,
through people known for their mob and money laundering ties, if that
reporting proves out, we`re left with the question of why that happened.
Why was money connected to Putin pouring into Trump projects? Why did they
do that?

And if it did happen, is it likely now all these years later that that sort
of thing is going to get somebody in trouble?

Reporter Tim O`Brien from Bloomberg joins us in just a moment. We`ve got
more ahead. Stay with us.

(COMMERCIAL BREAK)

MADDOW: We`re going to be joined by “Bloomberg View” columnist Tim O`Brien
in just a moment. Before we get to him, I want to go to back quickly to
Steve Kornacki with the latest on the Georgia congressional race that with
we have been watching tonight. This is the race between Democrat Jon
Ossoff and Republican Karen Handel.

This is a seat that used to be held by Republican Congressman Tom Price who
moved into the Trump administration to become the administration`s new
health secretary. Right now with about two-thirds of the vote in, just shy
of two-thirds of the vote, Karen Handel is at 52.6 percent, Jon Ossoff at
47.4 percent.

Steve Kornacki, tell us what this means

KORNACKI: Yes. So, you can see, Handel has moved into a pretty solid lead
in here. Last time I talked to you, I said there were ominous signs for
Jon Ossoff and the Democrats, especially out of Cobb County. That is the
story of what`s happened this hour. The same day vote has come in from
Cobb County. This is a Republican bastion. Karen Handel now getting 60
percent of the vote out of Cobb.

Cobb is now reflecting about the overall share of the vote in this district
and in the returns we`re seeing it should. And you see the result, Karen
Handel now jumping out to a pretty solid lead. She`s also – just the
votes that are cast today on Election Day, she`s getting 58 percent of the
votes that were cast on Election Day. She lost the pre-election day vote,
the early vote. She only lost it by 1.4 points.

This is a number that the Democrats thought they could get much higher.
They did anticipate Handel doing well today. Handel is doing well today,
but she did much better in the early vote than was expected.

MADDOW: All right. And, Steve, with this, we got 66 percent of the vote
in right now. We`re looking at about 10,000 vote lead for Handel. Do we
know more about what`s still expected to come in?

KORNACKI: Yes, here`s the bottom line – it`s pretty spread out evenly.
The same day vote, Karen Handel winning at a clip of 58 percent right now.
So, you can expect the same day vote that still out there.

She`s probably going to continue to lead it. Maybe the margin comes down a
little. She`s going to get more votes out of the same day.

The only thing if you`re a Democrat, you have to latch on is the mail-in
vote. Nothing from the mail ballot has been counted yet. But I`ve got to
tell you, just some quick math here from the preliminary – 6,500 mail-in
votes were cast total in the preliminary. Of those, Jon Ossoff got 76
percent.

What does that translate into? He got 5,000 votes, his opponents about
1,500. Now, if you have higher turnout here in the general election, if
that 6,500 went to up 10,000, me might net 5,000 votes out of that. So, if
he nets 5,000 out of the mail-in, he`s down 10,000 now. She has an
advantage in the same day, I got a hard time seeing it.

MADDOW: Steve Kornacki, we will be checking in with you as we get in more
of this vote.

Again, this is the special election in 6th congressional district in
Georgia, Democrat Jon Ossoff against Republican Karen Handel. If nothing
else, we`re getting a real-time result of what it means when more money is
spent to win a congressional seat than at any other time and for any other
seat in American history.

We`ll be right back with our exclusive interview with Tim O`Brien right
after this.

Stay with us.

(COMMERCIAL BREAK)

MADDOW: Joining us now is Tim O`Brien. He`s executive editor and a
columnist with “Bloomberg View”, is the author of “Trump Nation: The Art of
Being the Donald”, for which Donald Trump sued him and lost.

Tim O`Brien scooped tomorrow at “Bloomberg” on the financing behind of some
of Trump`s most high profile business projects and how that may ultimately
dovetail with the Trump/Russia investigation that scoop post tomorrow at
“Bloomberg View”.

Tim O`Brien, great to have you with us. Thanks for being here.

TIM O`BRIEN, BLOOMBERG VIEW: Thanks, Rachel. It`s good to be here.

MADDOW: So, let me ask you about the sort of central claim. You connect a
lot of these dots and put a lot of this history together. There`s a very
explicit claim from an ex-employee of this company called Bayrock, which
partnered with the Trump Organization. He is suing Bayrock which he used
to work for. And he says when he worked at Bayrock, one of the things they
discussed internally at that company is that how the funding they were
putting into Trump projects was coming from people close to Putin.

O`BRIEN: Right. Right.

MADDOW: Is – how credible is that allegation? Particularly given he is
kind of a disgruntled employee?

O`BRIEN: Well, it is purely anecdotal. He has no records that show that
the money came from Putin. The Kremlin, in a response to spokesman for
President Putin told me that he had no connection to the bank that loaned
the money to the Bayrock Group or to the Bayrock Group itself.

However, the banks that came into Bayrock were – and funding that came
into Bayrock was very murky, Putin or not, and came in through Felix Sater.
He was the guy corralling this money for the president. And as we know
about Sater, he was a career criminal, mob ties, had gone to jail for
assault, had ran a pump and dump scam, and then ended up sitting in Trump
Tower with the future president discussing business deals, traveling with
him, traveling with his children, taking his children to Russia to do
deals.

And I think to the extent that the Mueller investigation now is morphing
into something other than obstruction of justice investigation, and Mueller
begins to try to follow the money trail, it would be interesting if some of
this ends up coming back into an examination of Trump and his relationship
with Felix Sater.

MADDOW: And the report – there has been previous reporting, it`s very
interesting, in terms of Sater`s criminal history, this very interesting
and intriguing story in which he plead guilty and wasn`t sentenced for a
decade later. And all that intrigue about that for a number of reasons.

But, obviously, the president is never going to be in trouble for having
unsavory associates. That itself is not a crime. And if every politician
were indictable for that, there would be no politicians.

The question here is whether or not, there`s money that went from Russian
sources to President Trump that had implications other than business
implications.

O`BRIEN: And whether or not these associates sitting in his office develop
relationships with him back then that in the president`s current role could
present a national security problem regardless of whether or not there is a
crime. Felix Sater didn`t disappear from the Trump universe.

As “New York Times” reported earlier this year, he surfaced as one of the
people trying to push a Ukraine peace proposal to the White House. So, why
someone who the president said for years that he didn`t know, didn`t know
very well, ends up with the president`s own personal attorney pushing a
peace plan and clearly still in the orbit of the White House is an open and
interesting question.

MADDOW: Also, famously, Felix Sater had a business card as Trump
organization senior adviser. That was after Bayrock shut down, right?

O`BRIEN: That`s right.

MADDOW: So, they had closed that portion of their business relationship,
but personally, he was still involved with the Trump organization, had an
office there, had a business card there, had a job title there.

O`BRIEN: Yes.

MADDOW: So, there`s been some continuing –

O`BRIEN: And after Trump was questioned under oath in our litigation about
whether or not he was concerned about Felix Sater`s mob ties at the end of
2007 and yet three years after that and Sater continues as consultant to
the company. And a decade later is still in contact with the president`s
term attorney.

MADDOW: In terms of the question, again, about whether this is not just
association but this is related to the current stuff, am I also right that
one of the people who Bob Mueller brought on is special counsel one of the
lawyers working with him is somebody who actually prosecuted Sater for the
mob –

O`BRIEN: Andrew Weissmann was part of the New York district team that went
after that whole crew that was doing pump and dump schemes. So, yes.

MADDOW: Tim O`Brien, columnist and executive editor at “Bloomberg View”,
the story will post very early tomorrow morning. Thank you.

O`BRIEN: Thank you, Rachel. Good to be here.

MADDOW: Thank you.

We`ll be right back. Stay with us.

(COMMERCIAL BREAK)

MADDOW: Special elections are like bonus holidays for people who are
elections geeks. We`re all used to every four years, every two years for
midterms. But then special elections just happen randomly. It`s like, you
know, it – it`s like the calendar unexpectedly flipping or finding five
bucks in your pocket after you did the laundry.

But special elections are happening tonight in South Carolina, in Georgia.
South Carolina race was called early – relatively early for the Republican
candidate in that race, that`s pretty deep red district. The Georgia race
has been fascinating to watch as those results come in tonight. Lots of
implications both for the Democratic Party and the Republican Party writ
large in terms of closeness of that race and who ends up on the board at
end of the night. It`s going to be late one.

That does it for us for now. We will be back here at midnight Eastern Time
live with updated election results as our coverage continues now with “THE
LAST WORD WITH LAWRENCE O`DONNELL.”

Good evening, Lawrence.

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

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