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Mueller questioned companies that paid Cohen. TRANSCRIPTS: 05/09/2018. All In with Chris Hayes

Guests: Faiz Shakir, Michelle Goldberg, Sam Seder, David Cay Johnston, Adam Davidson, Jed Shugerman, Daniel Goldman, Jennifer Rodgers, Julie Zebrak James Henry

Show: ALL IN with CHRIS HAYES Date: May 9, 2018 Guest: Faiz Shakir, Michelle Goldberg, Sam Seder, David Cay Johnston, Adam Davidson, Jed Shugerman, Daniel Goldman, Jennifer Rodgers, Julie Zebrak James Henry

CHRIS MATTHEWS, MSNBC HOST: Thanks for being with us. "ALL IN" with Chris Hayes starts right now.



UNIDENTIFIED MALE: Is the President concerned that major corporations were giving money to somebody very close to him at a time when they had business before the federal government?

HAYES: The secret slush fund of President Trump's lawyer.


HAYES: Tonight, what we're learning about what companies got for paying Michael Cohen.

MICHAEL AVENATTI, LAWYER, STORMY DANIELS: Michael Cohen appears to be selling access to the President of the United States.

HAYES: And how the Russian collusion probe may have uncovered an even bigger public corruption scandal.

UNIDENTIFIED FEMALE: Any response? Any response to Avenatti?

MICHAEL COHEN, LAWYER, DONALD TRUMP: His documents is inaccurate.

HAYES: And as Trump's pick for CIA meets the Senate --

GINA HASPEL, TRUMP NOMINEE TO BE DIRECTOR OF CIA: Senator, I don't believe torture works.

TRUMP: And don't tell me it doesn't work. Torture works, OK?

HAYES: Are we about to repeat the mistakes of Bush administration?

HASPEL: I do not believe the President would ask me to do that.

TRUMP: We should go much stronger than waterboarding. That's the way I feel.

HAYES: ALL IN starts right now.


HAYES: Good evening from New York, I'm Chris Hayes. For the year and a half that we have been tracking every development in the Russia story, we had no idea there was another possibly even bigger scandal connected to the Trump administration and part of the Mueller probe, a potential corruption scandal that could involve the very same conduct the President accused his opponent of during the campaign.


TRUMP: It's called pay for play. If it's true, it's illegal. You're paying and you're getting things. It came out to her people, pay for play. This is big stuff. Pay for play. It's illegal.


HAYES: Tonight we now know that large sums of money have been flowing through a shell company set up by a close associate of the President of the United States before the election. Robert Mueller, on the other hand, has already been on the trail for this on this for at least six months. Yet again, his investigation several steps ahead of what is known to us in the public. So here's what the rest of us have learned in the last 24 hours. We already know that Michael Cohen, the President's lawyer-fixer-bagman if you will set up a shell company called Essential Consultants LLC in the middle of October 2016, right before the election. We already know he used that shell company to pay hush money to Stormy Daniels days before the election, and later to pay off a former Playboy Playmate who claimed to have gotten pregnant after an affair with a top Republican fundraiser, Elliott Broidy. OK. Now, it's alleged by Stormy Daniels' attorney, Michael Avenatti, that millions of dollars in corporate money have poured into that same shell company over the last year and a half. NBC News has reviewed documents that appear to support his account and records seen by The New York Times show transactions adding up to at least $4.4 million flowed through essential consultants starting shortly before the election and continuing to this past January. Among those transactions, according to Avenatti and the Times was half a million dollars from Columbus Nova, a New York-based investment firm linked to a Russian oligarch. Cohen also received $150,000 from a South Korean aerospace firm, the company has confirmed. He allegedly got up to $600,000 from AT&T and pharmaceutical giant Novartis has confirmed it paid him a total of $1.2 million but Cohen today disputed Avenatti's report.


UNIDENTIFIED FEMALE: Michael, how you doing today?

COHEN: I'm doing great, thank you.

UNIDENTIFIED FEMALE: Any comment about Michael Avenatti? Any response? Any response to Avenatti?

COHEN: His documents, it's inaccurate.


HAYES: Cohen's attorney just filed a 24-page left in court calling Avenatti's report "concerning for a number of reasons including the number of blatantly incorrect statements it contains." However, a number of the companies have confirmed payments to Cohen. The big question now is just what all those companies were paying Cohen for. They offered a range of explanations. According to Columbus Nova, the Russian oligarch Viktor Vekselberg had nothing to do with the payment to Cohen who they say was hired as a business consultant. The Korean aerospace firm, on the other hand, says it paid Cohen for accounting advice. According to AT&T, Cohen was one of several consultants they hired to provide insights on the new administration, a source telling CNBC the payment was for, "actual work done," which is always a nice thing to pay someone for. Now Novartis says they paid Cohen $100,000 a month for a year to advise them on health policy. But that's not exactly what he pitched them on. A senior Novartis official telling NBC News Cohen "contacted us when the new administration was in place. He was promising access to the new administration." In a statement today, Novartis disclosed that it was contacted by Mueller's office about the company's agreement with Cohen all the way back in November of last year. That was long before the public learned about Cohen's shell company, about the Stormy Daniels payment, about all of that. Oh, and AT&T just announced they were contacted around the same time. And both companies say they cooperated fully with investigators. To help break down this astonishing series of relations, I'm joined by Adam Davidson, Staff Writer for the New Yorker, and Jed Shugerman Professor at Fordham Law School. Adam, let me start with you. What do you think we are seeing with this shell company and what we now appear to know about the money flowing in and out?

ADAM DAVIDSON, STAFF WRITER, NEW YORKER: The most favorable description of what is going on here is that Michael Cohen was going around saying if you give me a lot of money, I will intervene on your behalf with the President of the United States. The best case scenario for the President is that he didn't know anything about this and Michael Cohen was going rogue in some way. That's still a deeply, deeply troubling story, a shocking, shocking story that has brought down many other politicians. And I think that the explanations we're getting do not suggest that this is probably all that true, that there seems to be some hints that the President was involved at least in some way in this business Michael Cohen set him up with, which of course would be a much more devastating news story.

HAYES: Yes, that to me is one thing I wanted to just sort of hang a lantern on which is what did the President know about Michael Cohen's activities. That's a question that has hung over the Stormy Daniels affair but now hangs over all of this. Jed, you wrote a piece in the Slate with the following title, "How Michael Cohen's Apparent Russia Payment Might Help Prove Collusion." What's your case there?

JED SHUGERMAN PROFESSOR, FORDHAM LAW SCHOOL: Well, there are a couple of pieces to that story. One, the way I framed it is I said it's premature to call it a smoking gun but I said it gave us a pretty good preview of a smoking gun, but I said it gave us a pretty good preview of a smoking gun and it also gave us a roadmap of how to find that smoking gun. So I think there are two parts to this. One part are the clear but medium-sized crimes that are really much more provable now for a prosecutor to go after Cohen and put pressure on him. So that includes now with this information a stronger claim of bank fraud for how he set up this essential consultants. And it also sets up questions of misrepresentation and fraud under New York Law, wire fraud, failure to register as a lobbyist under the Lobbyist Disclosure Act or the foreign registration law. But those are the pieces that a prosecutor could get to the larger and much more damaging claim of conspiracy and collusion because that larger claim is why is a Russian oligarch paying him $500,000 in the opening months of the administration? And in the timeline I spell out in the Slate piece, I show how that overlaps, that those payments overlap with some of the contacts that Flynn and Kushner were making with Russian officials and also overlaps with the Trump administration's watering down the sanctions. So Congress passes almost unanimously tougher sanctions on Deripaska and Vekselberg. And lo and behold, the administration slow-walks water down, tries to sabotage those sanctions. Under federal law, it is not a crime for pay to play, right? It's actually a hole in federal law. But quid pro quo for official acts, that's what we're looking at here. Was Vekselberg paying for a mix of Trump administration acts on sanctions from which he would benefit and his friends like Deripaska would also benefit? That's what prosecutors are going to be looking for.

HAYES: Adam, there is also an element to this of the fact that this -- you know, people have lobbying shops. There's a whole entire influence- peddling operation -- we call it K Street. They don't tend to be like an LLC that no one's heard of that is also paying hush money payments. It makes you wonder what else is there, right?

DAVIDSON: Absolutely. I think of course to some degree, giving money to people close to a president hoping to get access, hoping to get your story across is a disturbing and common trait throughout our country, the country's history or certainly recent history. This a cruder version than I think we're used to, but it's also a far more opaque and deliberately hidden version. And everyone involved is either being too cute by half or actually lying. And -- for example, the disturbing information we learned about Cohen's payment to Vekselberg was -- Vekselberg was immediately denied by Columbus Nova saying this thing, oh, he doesn't own this entity, he doesn't own the company that paid Cohen. However, the company that paid Cohen might technically be owned by his cousin and not him.

HAYES: Right.

DAVIDSON: But all its assets are his and it's this kind of deliberate obfuscation that makes you think if people are lying now with this blaring headlight on them, what else is there? What are we going to keep finding out?

HAYES: Jed, you're nodding your head.

SHUGERMAN: I think that's exactly right. And I think -- one thing to keep in mind is that this the tip of -- it could be the tip of the iceberg. I mean, we're seeing this payment come up now through a surprising early preview. I mean, I think that there are lots of questions about what else Michael Cohen has been involved with, and this story shows that there is going to be more pressure on him to reveal that. There are also lots of ties here between Vekselberg and Deripaska with the Bank of Cyprus that ties into Commerce Secretary Wilbur Ross. And the tentacles of all of these players could go much farther, much deeper. So I think we're seeing some of the story but not all of the story yet.

HAYES: I got to say, Adam, my journalistic B.S. detector when I start seeing this statements where AT&T says we paid him for actual work.

DAVIDSON: It's unbelievable. I mean --

HAYES: That does not -- that does not inspire a ton of confidence when you use that phrase.

DAVIDSON: We paid him for actual work. I mean, the Columbus Nova said we paid him to help us find investors and for real estate advice. Columbus Nova has a multibillion-dollar portfolio of massive investment class real estate investments all over the world. Michael Cohen has worked on a handful of mostly failed deals. It's absurd and laughable the story we're getting which of course makes every journalist in America think well what are we not getting.

HAYES: Maybe they were really wanting to get in the medallion business or (INAUDIBLE) or something like that. Adam Davidson and Jed Shugerman, great to have you both.

DAVIDSON: Great to be here.

HAYES: All right, for more on the potential legal ramifications of everything we've learned today, I'm joined by Daniel Goldman and Jennifer Rodgers, both former Assistant U.S. Attorneys from the Southern District of New York, the same office currently investigating Michael Cohen. There's nothing wrong with someone hiring a person for consulting services, if the consulting service is I tell you how Donald Trump thinks, right?


HAYES: That seems to Adam's case when you're talking about what the legal issue here is, that's the best case scenario for all involved is that this was an up and up transaction of those services.

GOLDMAN: Yes, you could even go a step farther and say that they thought they were going to get that and didn't.

HAYES: Right. That's sort of the Novartis line actually.

GOLDMAN: That's right. With Novartis saying, well, it was a contract where we could only fire him for cause, and after one meeting we realized he was not going to meet his end of the bargain. I'm not sure what their definition of cause is if that's not it but in any event, you know, there's -- there are sort of nefarious but not illegal --

HAYES: Right.

GOLDMAN: -- machinations here that could play out. But the potential for the -- I think Jed put it very well, the potential that this is just the tip of the iceberg, I mean, in my experience, people -- payments of $500,000 don't drop off a tree. So there was likely some form of a relationship prior to that payment, and it usually is not the only one. And the real question that Mueller was probably looking at in the fall before he referred this case to the Southern District and now the Southern District is looking into it is what was that relationship previously? And what they will be looking for, because Jed's right. The notion of pay to play, even as Donald Trump's words are being used against him, he's wrong to say it's illegal. It's not. You need to actually have some sort of quid pro quo now under the law where some payment of money goes to someone, and in return, they get an official action. Now that's where the relationship between Cohen and Trump is going to be really under the microscope.

HAYES: What do you think?

JENNIFER RODGERS, FORMER ASSISTANT U.S. ATTORNEY: I agree. I think they're also going to be looking for other companies and other relationships that Cohen had with other entities who also wanted to get close to the President. But really here you're talking about something that probably is not consulting. It may or may not have been lobbying. You know, by some accounts Cohen was kind of frozen out after the election and really wasn't that close to the President. But in any event, he is not a registered lobbyist so that's a potential problem. I think he's got a lot of exposure on the law licensing side of this with legal ethics violations so you know, he probably won't be practicing law any more if he really has been lately. But I think they're just going to kind of continue to dig, find out what was going on here, what really was exchanged for that money, and where else it goes as far as other entities, other accounts of companies.

HAYES: Well, right. That's the other question, right? It's like what are the other -- setting up an LLC is not hard. He seems to have one that he uses as a combo hush money payment fund, receipts payable for consulting services. But I mean, I imagine in the time you worked as a prosecutor, people can get very complex in the ways that they set up their financial dealings.

GOLDMAN: Well, not only people get complex, but in my experience prosecuting Russian organized crime cases, they get very complex. And Russia organized crime is a different animal than Italian organized crime, the Mafia. There's no breaking legs. It's a sort of sophisticated fraud- based organized crime with -- where money laundering and extracting the money out of the businesses is the most difficult thing to do. And that's why the relationship between Viktor Vekselberg and Columbus Nova is so interesting because is Columbus -- what is the relationship and is Viktor Vekselberg using Columbus Nova to funnel money out of his Russian business which all of the oligarchs want to do and get it over to the United States and into dollars which is much more desirable than the ruble. So when you're looking into all these businesses, what -- absolutely you're trying -- are they being layered? Is it for something else? And so the Russian angle of this is one critical picture. And then there's all of Michael Cohen's exposure. And what came out that was really shocking to me, I shouldn't say shocking, but noteworthy to me were these payments with Elliott Broidy which amounted pretty close to the amount of money that was paid to Karen McDougal who was the other playmate who had the deal with AMI. Now, this is getting a little too far down the line but what does -- what are those payments from Elliott Broidy -- it certainly -- it's not going to be his legal work because that would go to his law account. It's not going -- it's most likely not going to be his -- the legal work that he purportedly did for him.

HAYES: Right.

GOLDMAN: So there are a lot of unanswered questions here that put Michael Cohen under the microscope separate and apart from Russia.

HAYES: Am I crazy that I want to know what not just the inputs into essential consulting, but what -- who were they paying?


HAYES: Where were the outflows, right?

GOLDMAN: That's the whole thing.

HAYES: Because he doesn't have very much money apparently. He's putting up a mortgage on his property so that he could you know, pay for his legal fees.

RODGERS: That's right. So who's he paying? I mean, Mueller knows all of this, right? I mean --

HAYES: Does he know that?

RODGERS: He does. They have all the bank accounts. They have everything they need. I mean, the one wrinkle here is that Delaware is one of the states and there are others, famously Wyoming, Nevada, where it's very hard to get information about corporations set up there. We have a real problem with transparency in some states in this country with that. So it's hard to get some information from some places. But certainly they have all the bank information --

HAYES: But the banks, he can get.

RODGERS: Correct. And so, they'll be seeing the ins and the outs and they'll be tracing the money and figuring out what's going on.

HAYES: Daniel Goldman and Jennifer Rodgers, thank you both for being here.

RODGERS: Thank you.

HAYES: Next, Michael Cohen's lawyers demand to know how the lawyer for Stormy Daniels got his hands on Michael Cohen's bank records, which is a good question. One we want to know the answer to too. Our next guest has a theory to the case, in two minutes.


HAYES: Tonight, Michael Cohen's lawyers want to know how Stormy Daniels' attorney Michael Avenatti obtained documents that allegedly detail the millions of dollars of controversial payments paid to Michael Cohen's shell company. Mr. Avenatti has published some information that appears to be from Mr. Cohen's actual bank records and Mr. Cohen has no reason to believe that Mr. Avenatti is in lawful possession of these records. The Treasury Department is also questioning how Mr. Avenatti got those records launching investigation into whether confidential bank information was improperly leaked. Here to help shed some light on all of this, I'm joined by Julie Zebrak, a former Senior Adviser to the Treasury's Financial Crimes Enforcement Network. Julie, you have a theory what the origin of this information is. What is it?

JULIE ZEBRAK, FORMER SENIOR ADVISER, TREASURY'S FINANCIAL CRIMES ENFORCEMENT NETWORK: Right. So, Chris, thank you for having me on the show. I'm glad to be here. What is -- just to sort of back up for a minute, the way that information is transmitted when curious transactions are happening in somebody's banking is through the suspicious activity reports that banks are required to provide through the bank secrecy act to the Department of the Treasury and the Financial Crimes Enforcement Network. Banks have access to that information. They gather it based on the behaviors that they see through their customers, and then they turn it over to the Financial Crimes Enforcement Network or FinCEN. So what's strange here is that Michael Avenatti seems to have access to the information regarding suspicious activity with respect to Michael Cohen and some shell companies that he has found himself being exposed on. My thought, my initial thought is why would Michael Avenatti have these? These probably have been leaked from the Financial Crimes Enforcement Network. However, I have to say I certainly would hope that that were not the case. I do realize that now the Treasury Department's Inspector General is looking into it, which they rightly should. There certainly is a chance that somebody at the financial institutions that were involved is leaking it. But either way, SARS, or the Suspicious Activity Reports are treated as confidential and frankly, you can be subject to civil and criminal penalties for leaking them, not necessarily for receiving them, but for leaking them.

HAYES: So it seems these are based off suspicious activity reports that were filed. And we know from The Wall Street Journal that reported back in March the bank that Michael Cohen used to wire the $130,000 to Stormy Daniels flagged that transaction as suspicious, reported the Treasury Department. There seems -- so let's -- I want to move over from the question of the leaks which I agree with you. It seems that they're based off of SARS. How often when you're running a business, a legitimate business are you incurring these kinds of reports, which there seem to be a lot of around Michael Cohen's business?

ZEBRAK: Right. It's not super often. As you can imagine, normal banking activities are monitored by your bank, and they sort of know your banking habits. And it's really their responsible to KYC, Know Your Customer as a financial institution. So if you and I are used to -- we're getting our paycheck we have it deposited here or there, that's one thing. When you are suddenly receiving wire transfers and other means of deposits coming into your account, including from foreign entities or including from companies that don't appear to have much behind them other than a name and some forms, that tends to tip off the financial institution. Most of us don't have that going on, thankfully, but when there's a lot of activity like that, certainly a bank is under responsibility under the law to report it and to describe what they're seeing.

HAYES: Last question. We all know about the $10,000 for individual transactions that have to be reported and structuring which happened to Denny Hastert.

ZEBRAK: Right.

HAYES: I couldn't help but notice that the wire transfers for the retainer for Michael Cohen were $99,980, $20 short of $100,000. Is that a common thing? Is there anything -- $100,000 trigger some threshold?

ZEBRAK: You know, I wouldn't -- I wouldn't frame it like that. I really would frame it based on the activity that you're looking at.

HAYES: Right. It's not the number in other words.

ZEBRAK: Right, exactly. It's really the behavior, the source of the funds, and the behavior of his accounts. I mean, the banks really do have this ability to sort of know what your banking looks like. And in his case, that did not inure to his benefit.

HAYES: All right, Julie Zebrak, many thanks for coming on.

ZEBRAK: Thanks, Chris.

HAYES: Coming up, so just what was Michael Cohen offering these companies in exchange for their millions of dollars? The fine line between influence peddling and public corruption, next.


HAYES: There is plenty of legal influence peddling that goes on in Washington, from lobbying to revolving door for hiring. But what was happening with Michael Cohen in his shell company? The confusion around what exactly Cohen did, the opacity of where the money came from, where it went, even how these contract came about all raise serious questions about exactly what exactly kind of operation Michael Cohen was running here. Here to help me understand what's so strange about all this, James Henry an Economist, and Investigative Economist Editor at D.C. Report and David Cay Johnston, Founder and Editor in Chief for D.C. Report, author of It's Even Worse Than You Think: What the Trump Administration is Doing in America. And both of you gentlemen are people who specialize entirely in penetrating opaque financial structures. It's what you do, it's sort of your calling card there. So let me just start -- James, I'll start with you. Your first reaction to what we're seeing come into place here.

JAMES HENRY, INVESTIGATIVE ECONOMIST EDITOR, D.C. REPORT: Well, I think it establishes Cohen is a pretty incompetent fellow. I mean, if there were criminal charges for incompetence, I think he would be pleading guilty. You know, who sets up a fund to pay a porn star hush money and then uses the very same LLC you know, that has been paying him consulting fees from all kinds of companies like Novartis and also Vekselberg, or indirectly from Vekselberg. So that's item one on this agenda. I think maybe Cohen was just freelancing, you know.

If we established that Trump had actually told these various contributors that Cohen was the guy to see, then that would be a different thing. But it's quite possible that they on their own motion figured out that he was the pay to play guy and contacted him. And now they have buyers' regret. So that's my first reaction.

The second reaction is that this is an incredibly interesting network of Russian contacts that have, again, come into play here. I mean, Vekselberg and Deripaska and the guy named Vadnik are partners in a major aluminum company, they had a lot to fear from the sanctions program. So that was maybe a motivation for this. They were also partners in a big oil deal in 2013 where they all got $7 billion each from Rosneft, the state-owned Russian oil company.

So they're close to Putin. They throw their weight around. Lavatnik made $6.35 million of campaign contributions, including $2 million to Mitch McConnell's senate finance committee. And you know -- these are heavyweights. So the fact they're entangled with Michael Cohen in this is a little bit of a Keystone Cops moment.

HAYES: David, knowing Donald Trump and reporting on him for as long as you have, what do you think about the way in which people who are in his orbit are doing business once he becomes president?

JOHNSTON: Well, let's be real clear, this may not trace back to Donald -- it may well be that Michael Cohen simply saw an opportunity, went out and seized the opportunity...

HAYES: Right.

JOHNSTON: do so. Donald is not a guy with strong management skills. You know, his whole show is based on a premise that management professors would be tearing their hair out, or that's not how you motive people and get them to be successful.

So, on the other hand, Donald is a guy who hey, if there is money to be made over there, let's do it. And it will be very interesting to see if any of this money touches Donald or his family or his companies. If it does, we have a really major important scandal here.

HAYES: What do you mean by that?

JOHNSTON: Well, if any of the money that flowed into this entity or any of the other shell companies that Michael Cohen set up turns out to have been forwarded not to Michael Cohen or his entities, but to a Trump entity, now, you know, now you're looking at what looks very much like either extortion or bribery, which is the same crime from two different perspectives.

Clearly Michael Cohen, you know, had these companies believing he had the president's ear and could influence him. Their own statements indicate that they don't think it went anywhere. And, Chris, think about AT&T. They're in a very tough spot. I mean, I'm very -- have spoken a lot about lack of competition, especially in the media business in this country. But AT&T is at a significant disadvantage without owning your competitor, CNN. And so they would be very susceptible to suggestion that, you know, you don't want to continue to be in that position, you better come pay tribute.

HAYES: You know, one thing, James, that struck me, I saw someone write this piece that if this payment were happening in a foreign country for an American company, their compliance office, because of the Foreign Corrupt Practices Act, if you said hey, the president of the Philippines, the president of Nigeria, has a personal friend and lawyer that we're going to get on retainer for half a million dollars, the compliance lawyer would say you can't do that. You're going to violate the Foreign Corrupt Practices Act.

HENRY: That's absolutely right. And I think that this kind of practice should be illegal, even if it's not at the present time. You know, that's a court ruling that a lot of people have problems with.

More general issue I think here is that this administration has a pattern of opening itself up to all kinds of influence from corporations and also from Russian interests in this case. You know, it's just not transparency with respect to what's going on.

I think the American people need to be getting involved. These are a lot of funny Russian names and interests, and it's quite a complicated story. I just got back from Cyprus and was looking into a lot of this stuff. It's a global story that many Americans sort of the eyes glaze over. But I think it's really important for them to dig in and to understand this kind of chicanery.

HAYES: Well, David, it makes me want to see the tax returns all the more. I mean, it really does become -- no, seriously. At a certain point it becomes vital to put all this stuff to rest, again. Where is the money going and what's it doing? And there is a lot of legitimate questions or legitimate questions a year-and-a-half or two years ago, but they seem more pressing now to me.

JOHNSTON: Well, who is doing business with Donald Trump entities in other places and favors?


JOHNSTON: And we already know that the Chinese with lightning speed were approving things for Donald Trump and that nobody -- no country has been a bigger beneficiary of Donald Trump's actions than China, which is gaining influence in the Pacific at our expense. So this is a window, the Michael Cohen matter, into a lot of things that we need to pursue.

HAYES: All right, James Henry, David Cay Johnston, thanks for joining me.

Still to come, down the memory hole in the torture debate the president's nominee faces the senate today. How have we come to this point again?

Plus, this guy, the silver lining after Don Blankenship's epic electoral loss is tonight's Thing One, Thing Two next.


HAYES: Thing One tonight, primary day in America has come and gone, as has the brief and glorious political career of Don Blankenship, at least for now. He is, of course, the former coal company executive who is released from prison last year after serving a year for mine safety violations connected to an explosion that killed 29 people. He then ran for U.S. Senate and talked about China people.


DON BLANKENSHIP, REPUBLICAN SENATORIAL CANDIDATE: This idea that calling somebody a China person, I mean, I'm an American person. I don't see this insinuation by the press that there is something racist about saying a China person. Some people are Korean persons and some of them are African person.


HAYES: He also began referring to majority leader of the Senate as Cocaine Mitch, making a bizarre connection to a report that a shipping vessel owned by Mitch McConnell's father-in-law was discovered to have drugs on board in 2014.


BLANKENSHIP: One of my goals as U.S. Senator will be to ditch Cocaine Mitch.

I will beat Joe Manchin and ditch Cocaine Mitch for the sake of the kids.


HAYES: And it's truly surprising, shocking, that that guy with all of that charisma and that incredible ad, Don Blankenship came in third in yesterday's GOP primary for a U.S. Senate seat in West Virginia. The state's attorney general Patrick Morrisey won. Blankenship conceded, and Cocaine Mitch rubbed it in. That's Thing Two in 60 seconds.


HAYES: So, after shooting for the starts, Don Blankenship finished last in yesterday's GOP primary in West Virginia, and in last night's concession speech he pondered the impact of his more questionable campaign tactics.


BLANKENSHIP: You know, I'm being asked, of course, whether some of the things we did, whether it's Cocaine Mitch or whether it's some of the other criticisms of Mitch McConnell, or whether it's China people that made the difference, I really don't think so.


HAYES: Yes, how did i lose? Let me count the ways.

President Trump, who had urged West Virginians not to vote for him, Blankenship wrote an open letter which reads in part "you yourself also spread fake news against me."

But the burn of the night came from the man Blankenship called Cocaine Mitch whose team tweeted this note when the results were in, "thanks for playing, Don," featuring Mitch McConnell in a cloud of cocaine. It's a Photoshop of this ad for the Netflix show Narcos.

Don Blankenship was not amused, "Mitch McConnell's cocaine tweet is just more proof that he is not an America person. Thousands die from cocaine use year after year, and he thinks it's funny that his family's shipping business hauls cocaine on the high seas?"

Really not sure if that part is true. But thus endeth the brief and unsuccessful senate bid of convicted felon Don Blankenship. There was, however, at least one silver lining. At midnight, just hours after he came in a distant third in the Republican senate primary, Don Blankenship's year-long probation came to an end. And he has plans.


BLANKENSHIP: Go on vacation. You know, I'm off of probation tonight at midnight. I've not been able to go places I like to go for three years now. And I'll get my guns back in a day or two. So I'm going to win either way tonight.


HAYES: Just one day after President Trump's decision to unilaterally withdraw from the Iran nuclear deal, there are troubling signs of renewed tension and violence in the Middle East. About an hour after President Trump's announcement, an Israel missile strike south of Damascus, Syria killed 15 people, at least 8 of whom were Iranians, according to the Syrian Observatory for Human Rights that monitors these things.

And then tonight, Iran fired about 20 rockets into the Golan Heights from Syria, according to an Israeli military spokesman.

The president's decision to pull out of the deal that ostensibly would prevent Iran from becoming a nuclear armed nation also unleashed new concerns about a general arms race in the Middle East.

Saudi Arabia today saying they will seek to get nuclear weapons if Iran starts up a nuclear program. Still to come, the president who promised to bring back torture has a CIA nominee who once oversaw torture go before the Senate today and say she thinks we probably won't be doing that again. That's next.



UNIDENTIFIED FEMALE: Do you believe that the previous interrogation techniques were immoral?

GINA HASPEL, DEPUTY DIRECTOR CIA: Senator, I believe that CIA officers to whom you referred...

UNIDENTIFIED FEMALE: It's a yes or no answer.

HASPEL: Senator, what I believe sitting here today is that I support the higher moral standard we have decided to hold ourselves to.

UNIDENTIFIED FEMALE: Please answer the question.

HASPEL: Senator, I think I've answered the question.



HAYES: Much of the senate hearing today for President Trump's nominee to lead the CIA, Gina Haspel, was taken up with Haspel's role in the use of enhanced interrogation techniques, and I put that in quotes, otherwise known as torture during the Bush administration.

There has never been any real moral reckoning with the torture chapter in American history. It has been for the most part just thrown down the memory hole. And now the president wants the CIA led by someone who oversaw a black site where U.S. officials say waterboarding, aka torture, took place and who played a direct role in the destruction of videotapes showing the CIA agents torturing al-Qaeda detainees.

Haspel said today she would not bring the torture program back and that she doesn't believe torture works. She also suggested Trump would never ask her to order waterboarding.


SEN. BARBARA BOXER, (D) CALIFORNIA: If the CIA has a high value terrorism suspect in its custody and the president gave you a direct order to waterboard that suspect, what would you do?

HASPEL: Senator, I would advise -- I do not believe the president would ask me to do that.


HAYES: Oh you don't? Have you listened to the president?


TRUMP: And don't tell me it doesn't work. Torture works, OK, folks? You know have these guys torture doesn't work. Believe me, it works, OK. And waterboarding is your minor form. Some people say it's not actually torture. Let's assume it is.

But they ask me the question what do you think of waterboarding? Absolutely fine. But we should go much stronger than waterboarding. That's the way I feel.


HAYES: Joining me now, Fair Shakir, national political director at the ACLU; Michelle Goldberg, op-ed columnist at the New York Times; and MSNBC contributor Sam Seder, host of the Majority Report podcast.

Faiz, I know the ACLU has been opposed to Gina Haspel's nomination. Did her performance today assuage any of your objections?

FAIZ SHAKIR, ACLU: No. We learned nothing about her through this nomination hearing. We knew exactly two things about her heading into today's nomination hearing. Thing one, if you will, was that she participated and supervised torture and participated in that criminal conduct; in one case, overseeing Detention Site Green, a black site in Thailand in which a detainee was slammed against the wall, waterboarded, stripped naked and locked in a coffin-sized box, right, so that was thing one.

Thing two that we knew about her was that she destroyed evidence about torture many years later. On both of those account, we have gotten no transparency and no further information from this nominee. She has been evasive and stonewalled on that. And I think it's an embarrassment for the Senate to even consider voting on a nominee when you don't have this basic level of knowledge and information about only two things we know about her.

HAYES: I will say Jon Tester, who is a Democratic senator who is -- going to have a contested race in Montana said he is not going vote for Haspel. He says I'm not a huge fan of waterboarding.

John McCain just released a statement from Arizona where he is currently undergoing continued treatment for brain cancer. He said Ms. Haspel's role in overseeing the use of torture by Americans is disturbing. Her refusal to acknowledge tortur's immorality is disqualifying. He will also vote against her.

SAM SEDER, HOST, MAJORITY REPORT: You know, I'd also say the answer I found disturbing was this notion that somehow after the torture program ended or it was made clear to the American public that America decided that we didn't want to torture. And that actually was decided about 80 years ago in the Geneva conventions, and it was reiterated in 1993 in federal law in this country.


SEDER: So the idea that we had a new understanding of torture following 2005 is simply a lie. I mean, really, that was the point where I thought like every senator there should get up and walk out. This is a joke in many respects.

MICHELLE GOLDBERG, NEW YORK TIMES: I mean, I also think that at least some senators are in a difficult position, because although obviously people should vote against Gina Haspel, especially under this president, the last thing you want to do is be sending a message of impunity for torture, there is also the fact that if it's not Gina Haspel, it's likely to be somebody - - we're not going have a nominee who opposes torture. We're not going to have a CIA director under George W. Bush -- I mean, under Donald Trump who has any support for human rights. And I think that there is probably people who think better Gina Haspel than Tom Cotton.


GOLDBERG: Somebody who at least people who have led the CIA in the past and truly loathe this president say she that will push back if not about torture, about some of the other kind of institutional prerogatives of the CIA.

HAYES: Yeah, there are people in the CIA love Gina Haspel. I think that has come across people that I have talked to.

SHAKIR: It's tribal.

HAYES: Well, no, but I also think she has very good reputation there. I think it's a little more than that.

SHAKIR: She's also backed the rank staff in destruction of the videotapes. We know what that was about. It sold as like I had your back in a critical and difficult moment. That earns credit from staff.

HAYES: Right, but that connects to bigger point that the CIA and those folks make, and I've been seeing them make it which is, look, the OLC wrote a memo, John Yu, who by the way as we talk about Gina Haspel sits in Berkeley Law School who wrote a memo saying it's OK to commit war crimes, sits in liberal Berkeley with the liberal Berkeley faculty and goes to work every day, and he gets to be a tenured law professor, that John Yu wrote that memo. We take that legal advice from the OLC. We implemented what you Americans and what you the federal government told us to do. And now you're going to turn around and put it on us?

Well, James Bivey, who supervised that, is a federal judge and John Yu sits at Berkeley.

SHAKIR: When we were working with Senator Feinstein's staff to produce the torture report, the things we learned is was that there were CIA personnel, agency personnel, who were in these detention sites conducting these tactics and were very upset about what they were doing, really wanted guidance from above and said do we really need to carry this out? I want to resign. I don't want to do this. And it was supervisors like Gina Haspel specifically who said push, go ahead. Keep doing it. In fact, she came into the base to start heading up and spearheading these particular tactics, the use of enhanced interrogation techniques.

Now, I think -- Chris, I think -- there is torture, right? But what I am in fear of is that Donald Trump in a critical moment, an emergency, a terror attack on America.

HAYES: Absolutely.

SHAKIR: Looks to Gina Haspel and says push the envelope for me. I want to shut down the borders. I want to surveil people. I want reopen GITMO. I want detention. I want roundups. I want registries. Gina Haspel, figure out way to do it. Is she going to be the person who says yes? By all accounts, my concern is that she would be. The loyalty pledge seems to be in effect right now. She is somebody who is working at behest of Donald Trump. She's not an accountability check on him.

SEDER: And I would add that I think, you know, the idea of where Yu is today and Bivey is today and frankly John Brennan, for that matter, having served at the CIA, these are cautionary tales. This is what happens when you let a little bit slip.


SEDER: And to reward -- this is not just even just about impunity for torture, this is rewarding that torture.

HAYES: This is a massive promotion.

SEDER: She may be a company woman. That's great. But the fact of the matter in this endeavor, it's not one that we should be rewarding.

HAYES: The other thing about this is that Trump has swooped in to make this a referendum on torture. I mean, this is his tweet, "Gina Haspel, my highly respected nominee to lead the CIA, is being praised for fact that she has been and always will be tough on terror. This is a woman who has been a leader wherever she has gone. The CIA wants a leader into America's bright and glorious future."

Like, he...

GOLDBERG: Right, so that's the terrifying thing is that when she -- if and when she gets confirmed, and it looks like she is going to get confirmed even though McCain has come out against her, that this is essentially saying that, as Trump has been saying, that this is what the CIA should in fact be doing.

HAYES: And I think it's important for the Supreme Court to watch all this play out. The Supreme Court should know that whoever you rule on that Muslim ban, the next day if you uphold it, in the same way this is a referendum on torture, the president is going to say thanks for upholding my Muslim ban.

SEDER: Right, of course. This is a referendum for him. I mean, this is just another sort of I think ID in the same way that crashing the Iran deal was. And so we're advocating torture in this instance if we confirm her.

HAYES: Well, Joe Manchin says he is a yes. It looks like it's going to be narrow. But we will see what happens. Faiz Shakir, Michelle Goldberg, Sam Seder, thank you for being with me tonight.

Don't forget, you can download our show as a podcast. Did you know? Don't forget to hit subscribe so you never miss an episode. There might also be more podcast news coming. We will keep you posted on that.

And that is All In for this evening. The Rachel Maddow Show starts right now. Good evening, Rachel.


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