Nightline (ABC) - 2009-02-18

Channel: malgent

Transcript

Language: English (original, YouTube automatic captions)

[0:04] Tonight on Night Line Extreme Makeover

[0:07] Home Edition, President Barack Obama

[0:10] tosses a $75 billion lifeline to the

[0:12] nation's woeful housing market. But what

[0:15] does his plan mean for you? We're live

[0:17] from the front line of the foreclosure

[0:20] crisis. Manhunt. The search is underway

[0:22] for another fat cat banker accused of

[0:25] cheating his investors out of billions

[0:28] as his friends in high places distance

[0:30] themselves from another alleged mega con

[0:33] man. Plus, into the wild, high above sea

[0:36] level in the mountains of Mexico. Join

[0:38] us on a journey to witness one of

[0:40] nature's greatest events. How do

[0:43] millions of butterflies know how to get

[0:45] here from the Great Lakes?

[0:48] From the global resources of ABC News

[0:51] with Martin Basher and Cynthia McFaten

[0:53] in New York City and Terry Moran in

[0:56] Phoenix, Arizona, this is Night Line,

[0:59] February 18th, 2009.

[1:04] Good evening everyone. I'm Terry Moran.

[1:06] So, here we are in Phoenix. This place

[1:09] has been as hard hit by the housing

[1:11] crisis as just about anywhere. And

[1:13] that's one reason why President Barack

[1:15] Obama chose to lay out his aggressive

[1:17] housing plan here. You don't need me to

[1:20] tell you the nation needs help with home

[1:22] values plummeting, foreclosures soaring,

[1:25] and the whole sorry mess dragging down

[1:27] the banks and the entire economy. So

[1:29] today, the president whose campaign was

[1:32] based so much on hope tried to restore

[1:34] it for so many Americans in trouble. As

[1:37] we report tonight in our series, Realy

[1:40] Check.

[1:42] It was no accident that President Obama

[1:44] unveiled his plan here

[1:46] >> in Phoenix and its surrounding suburbs.

[1:49] The American dream is being tested by a

[1:53] home mortgage crisis that not only

[1:55] threatens the stability of our economy,

[1:58] but also the stability of families and

[2:00] neighborhoods.

[2:02] Phoenix is full of what look like ghost

[2:04] towns. subdivisions that sprouted out of

[2:06] the desert a few years ago, now packed

[2:08] with empty houses for sale signs lining

[2:11] the streets. Today, the president said

[2:14] the government is going to help in a big

[2:16] way.

[2:16] >> Through this plan, we will help between

[2:18] 7 and 9 million families restructure or

[2:22] refinance their mortgages so they can

[2:24] afford avoid foreclosure.

[2:27] >> How? By making it a lot easier for

[2:30] people to refinance with today's low

[2:32] interest rates. by using tax dollars to

[2:34] reduce monthly mortgage payments for

[2:36] homeowners in trouble and by pouring

[2:38] billions into the mortgage markets to

[2:40] get them moving again. Taken together,

[2:43] the provisions of this plan will help us

[2:46] end this crisis and preserve for

[2:48] millions of families their stake in the

[2:50] American dream.

[2:51] >> But will it work? Who wins under this

[2:54] plan? And who gets left behind? We

[2:56] headed into Phoenix's grim real estate

[2:59] market to find out. On just one street,

[3:02] West Zion Road in suburban Maricopa, we

[3:05] found three houses for sale. Two that

[3:07] were bank-owned, one whose mortgage is

[3:10] underwater and one occupied by a new

[3:12] owner who bought very, very low. When

[3:15] they talk about the housing crisis, they

[3:17] mean West Zion Road and people like Kim

[3:20] Ivac.

[3:21] >> At one time, all three of these, all

[3:23] four of these were all up for

[3:25] foreclosure. And then there was about

[3:26] six of them down the street that were up

[3:28] for sale by owner. She's a single mom.

[3:30] She bought her house in Maricopa in 2006

[3:33] for $29,000.

[3:35] It's now worth less than $130,000.

[3:39] When we talked to her last night before

[3:41] the president's speech, she told us

[3:43] she's just trying to hold on.

[3:45] >> I'm just I'm stuck. I won't let my house

[3:48] go, but yet I want some help. What am I

[3:50] going to do? So, I'm a single mom and I

[3:52] have to pick up my family and go rent a

[3:55] house and lose all the money that I've

[3:56] put into this house, but I'm not getting

[3:59] any answers. I'm not getting any help.

[4:00] >> This whole neighborhood is struggling.

[4:02] Just a few blocks away, we met up with

[4:04] realtor Susan Abdullah, who these days

[4:07] is dealing with a lot of foreclosed

[4:09] homes.

[4:10] >> This house was built in '05, maybe four

[4:12] years old, barely.

[4:14] >> How much did this house originally sell

[4:16] for?

[4:17] >> I believe over 250,000. And how much is

[4:20] it going for now?

[4:21] >> 95,000.

[4:23] >> 95,000. Mhm.

[4:25] >> Let's take a look. Okay.

[4:28] >> 2300 square ft, four bedrooms, and the

[4:31] price is still falling.

[4:33] >> What do we get for $95,000 here? We're

[4:37] in Maricopa, Arizona. It's always sunny

[4:39] and nice. Four bedrooms. This must be

[4:42] the master.

[4:45] Let's see. It's big.

[4:46] >> But this was someone's dream. I hate

[4:49] seeing people losing their homes as as

[4:51] rapidly as they are. I also hate to see

[4:55] the prices dropping so radically that

[4:58] people just let them go back to the bank

[5:01] because they know that it's going to be

[5:02] years before the the value is what they

[5:05] owe on the property.

[5:06] >> So fixing

[5:08] >> the collapse in prices and getting

[5:10] people out from underwater as they say

[5:13] that's that's essentially what you were

[5:14] looking for.

[5:14] >> Sure.

[5:15] >> Absolutely.

[5:16] >> Now how do you get a floor under those

[5:17] prices?

[5:18] >> Yeah. I really I don't envy anybody

[5:21] who's in power who has to make that

[5:23] decision or figure that out cuz I really

[5:25] don't know. I wish I wish I did.

[5:28] >> That's the goal of President Obama's

[5:30] plan. Stop the bleeding. Stabilize these

[5:32] neighborhoods here and around the

[5:34] country. Keep people in their homes.

[5:37] Rudy Bonitz is a mortgage broker here.

[5:39] >> Take a step back in this area. What's

[5:41] the What's the real estate situation

[5:43] like right here?

[5:44] >> Bleak. That's a very, very easy

[5:46] question.

[5:47] >> Rudy says the crucial part of the plan

[5:49] is getting mortgage giants Fanny May and

[5:51] Freddy Mack to refinance mortgages for

[5:54] people who have little or no equity in

[5:56] their homes.

[5:58] >> For those people who are still in their

[6:00] homes,

[6:01] >> what does the Obama plan do for them

[6:03] from your perspective?

[6:04] >> Um, simply put, I think it gives them

[6:06] hope to be honest. It gives them the

[6:08] chance to hold on to their largest asset

[6:10] instead of just falling by the wayside

[6:11] like so many folks have. What about the

[6:14] backlash question? The sense that there

[6:16] are 90% of homeowners who are on time,

[6:19] who who bought a house they could afford

[6:21] and are looking at all this money going

[6:23] to people who are in trouble and

[6:25] thinking, you know, maybe sometimes you

[6:28] just got to pay the piper if you if you

[6:29] buy a house you can't afford. What do

[6:30] you say to them?

[6:31] >> We're it's not it's to the point where

[6:33] we'll have to look out for just

[6:34] ourselves. Uh we're in a time now where

[6:36] we have to work as a team,

[6:38] >> but not everyone in trouble is going to

[6:41] make it. Come here.

[6:43] Good boy.

[6:45] >> This afternoon, we went back to Kim

[6:47] Ivacc to see if she thought the

[6:48] president's plan would help her.

[6:51] >> Even if I could at least eliminate my

[6:53] monthly mortgage by, you know, $300,

[6:55] $400 is is a big savings to me right

[6:58] now. I don't want to lose my home. I

[7:00] don't want to walk away from it. I just

[7:02] want to make it so that it's a little

[7:03] easier for me to afford my monthly

[7:05] payments.

[7:06] >> One homeowner, one family, so much hope

[7:09] at risk. It's as if the country is

[7:12] waking up from a delirium, a fever dream

[7:14] of endless wealth in housing and the

[7:17] hangover hurts. The president today said

[7:20] what happened in this country was more

[7:22] than an economic crisis.

[7:24] >> And each of us as individuals have to

[7:27] take responsibility for their own

[7:29] actions. That means all of us have to

[7:32] learn to live within our means. Again,

[7:34] >> in Maricopa and in so many other places,

[7:37] they've learned that lesson the hard

[7:40] way.

[7:43] The whole crisis is changing the

[7:45] culture.

[7:46] Well, when we come back, another day,

[7:49] another lead giant fraud. We've got the

[7:52] story of the manhunt for a billionaire

[7:54] financeier accused of another giant

[7:56] Ponzi scheme and maybe much more.

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[11:11] Bernie Maidolf. You probably never heard

[11:13] of him until two months ago. Now he's

[11:15] one of America's most hated men. the

[11:17] living symbol of all that greed that

[11:20] broke the economy. Well, he may now have

[11:22] some company. Allan Stanford at Playboy

[11:25] Finance Seir stands accused of cheating

[11:28] investors out of billions. Yesterday,

[11:31] his businesses were raided. Today, he's

[11:33] nowhere to be found. Our chief

[11:35] investigative correspondent, Brian Ross,

[11:37] has the latest. Brian,

[11:39] Terry, Allan Stanford had the perfect

[11:42] product for nervous investors. safe,

[11:44] sound certificates of deposits, CDs with

[11:47] a healthy rate of return. US authorities

[11:50] now say it was a scam that could rival

[11:52] the maid off affair carried out for

[11:54] years by a man with lots of friends in

[11:57] Washington.

[11:59] >> Stanford's Bank was headquartered on the

[12:01] Caribbean island of Antigua, where today

[12:03] residents lined up to see what, if

[12:05] anything, was left of the money they

[12:07] invested here. It was a scene repeated

[12:10] in cities on six continents involving at

[12:13] least$8 billion dollars. People familiar

[12:15] with Stanford's background say what's

[12:17] happening now should come as no

[12:19] surprise.

[12:20] >> He started out as a banker on the island

[12:22] of Monserat. It was a place notorious

[12:25] for corrupt banks and uh criminal

[12:29] enterprises. He moved to Antigga and all

[12:32] of a sudden announced he had these

[12:34] billions of dollars under management.

[12:37] Uh, no one could believe it and they all

[12:39] thought this had to be some form of drug

[12:42] money laundering.

[12:43] >> Stanford's operation thrived under

[12:45] Antigua's loose banking regulations.

[12:49] He was given a knighthood by the local

[12:51] prime minister and became known in the

[12:53] Commonwealth countries for his lavish

[12:55] support of cricket matches between the

[12:57] West Indies and England.

[12:59] >> Well, that sir was never recognized by

[13:01] the British and it's up to the Queen to

[13:04] do the nighting. Even so, he regularly

[13:07] showed up on English television at

[13:08] cricket matches described as Sir Allen

[13:11] surrounded by a bevy of beauties.

[13:14] Business seemed to be booming for

[13:15] Stanford as he expanded branches around

[13:17] the world and he recently told the BBC

[13:20] that he had avoided the economic crash.

[13:23] >> So, our business now is better than ever

[13:24] and we're sitting on a huge pile of cash

[13:26] and we're looking to acquire stuff,

[13:29] quality stuff and and quality people.

[13:32] But the Securities Exchange Commission

[13:33] in its complaint says Stanford was a

[13:36] fraud and a liar. That the steady 15%

[13:39] growth he promised investors for years

[13:42] was a lie.

[13:43] >> This was going on in plain sight. Uh

[13:46] anyone who wanted to take a look at it

[13:48] could have seen that everything that was

[13:50] happening was questionable. But the SEC

[13:53] only acted after it learned that two

[13:55] former Stanford brokers in Houston, Mark

[13:58] Tidwell and Charlie R had blown the

[14:00] whistle on Stanford in a lawsuit filed

[14:02] in late 2007.

[14:04] >> The problem was is that the the

[14:07] published returns that many advisers

[14:10] used to uh to present to clients and

[14:12] prospects uh that now we knew that the

[14:15] information was incorrect. they would

[14:16] lie about it and that behavior just

[14:19] became more and more prevalent pre

[14:20] prevalent or at least we saw that.

[14:22] >> But the men say the executives at

[14:23] Stanford told them not to worry that the

[14:25] US could not touch them because the bank

[14:27] was chartered in Antigua.

[14:29] >> They they talked like that. They knew

[14:31] that it was outside the jurisdiction

[14:33] that the SEC didn't have anything any

[14:35] oversight over the certificate of

[14:37] deposit.

[14:37] >> And when the SEC did try to open a case,

[14:40] the whistleblowers say orders were given

[14:42] to destroy documents. The assistants

[14:45] were pulled together in a conference

[14:47] room and asked to clean out the the

[14:50] files of of every client that had money

[14:52] at the bank.

[14:54] >> All the while, Stanford was living a

[14:56] flamboyant lifestyle, profiled by CNBC

[14:59] last May as one of the world's richest

[15:01] men, referred to as Sir Allen.

[15:04] >> Is it fun being a billionaire? Well, um,

[15:09] yes, yes, yes. I have to say it is fun

[15:11] being a billionaire, but but it's hard

[15:13] work.

[15:14] >> As law enforcement officials raised ever

[15:16] more questions about him, Stanford spent

[15:18] some $8 million in Washington on

[15:20] lobbyists and campaign contributions. He

[15:23] hired as a senior vice president, the

[15:26] former chief of staff of the House

[15:27] Financial Services Committee, Jim

[15:29] Councilman, who handled the lobbying

[15:31] effort. And today there was a long list

[15:34] of embarrassed politicians eager to

[15:36] distance themselves from the money they

[15:38] took from Stanford.

[15:40] >> Florida Democratic Senator Bill Nelson

[15:42] got $47,000.

[15:44] >> I've instructed my campaign to return

[15:46] every dime.

[15:48] >> Arizona Republican Senator John McCain

[15:50] got $28,000

[15:52] which his staff says he will turn over

[15:54] to charity. And New York Democratic

[15:56] Senator Chuck Schumer got $17,000.

[15:59] >> We donated to charity. Stanford's last

[16:02] effort to buy connections came this

[16:04] summer at the Democratic convention in

[16:06] Denver. The website for Stanford's firm

[16:08] shows video of Stanford at the

[16:10] Democratic convention being hugged by

[16:12] the Speaker of the House, Nancy Pelosi,

[16:14] and thanked for his $150,000 sponsorship

[16:18] of a big event there by former President

[16:20] Clinton.

[16:21] >> I'd like to thank the Stanford Financial

[16:23] Group for helping to underwrite this.

[16:26] The National Democratic Institute, which

[16:28] invited Stanford to speak to a who's who

[16:30] of top Democrats, now says it had no

[16:33] idea his company was suspect when they

[16:36] took his money.

[16:37] >> He really didn't have to make political

[16:39] contributions. The SEC was so slow to

[16:42] react to anything that uh there was no

[16:46] real problem for him. The SEC finally

[16:48] moved in on Stanford this week as US

[16:51] marshalss raided his offices in Houston,

[16:53] Memphis, and Tupelo, Mississippi. It was

[16:56] a vindication for the two whistleblowers

[16:58] who put their careers on the line to

[17:01] challenge the powerful Stanford.

[17:03] >> We were very concerned for our clients.

[17:05] We have uh

[17:08] we have fortunately got most of them out

[17:10] as as we we left.

[17:11] >> I feel Yeah, I feel like we've done

[17:13] we've done the right thing as Charlie

[17:15] has indicated. Uh, you know, we we we

[17:18] got out because we thought it was the

[17:20] right thing for our clients. It's been a

[17:22] very difficult year and uh and we hope

[17:25] what uh what we did can can help others.

[17:28] >> The SEC fraud complaint may be the least

[17:30] of Stanford's worries. Federal

[17:32] authorities tell ABC News tonight that

[17:34] Stanford is under investigation by the

[17:37] FBI in connection with an alleged

[17:39] moneyaundering scheme for the notorious

[17:41] Mexican Gulf Cocaine Cartel. The SEC had

[17:45] been asked to hold off its action

[17:47] because of the drug money investigation,

[17:49] but officials say they finally had to

[17:51] move in this week as they saw Stanford's

[17:53] bank being emptied of its assets. Terry,

[17:57] unbelievable. Thanks, Brian. Our thanks

[18:00] to Brian Ross for that as the heat is on

[18:02] that guy. Now, when we come back, our

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[22:08] Night Line continues from Phoenix,

[22:10] Arizona with Terry Moran.

[22:14] This is beautiful. We are about to share

[22:17] with you a natural phenomenon that only

[22:19] happens during a certain time of the

[22:20] year in a remote place high in the

[22:23] Mexican mountainside. If you've ever

[22:25] experienced it firsthand, well, you're

[22:27] lucky because this magical event is now

[22:30] in danger. As Jeffrey Kaufman reports in

[22:33] our series, Into the Wild.

[22:37] When the sun comes out in the mountains

[22:39] of central Mexico at this time of year,

[22:41] something magical happens.

[22:48] Each of those tiny orange spots is a

[22:51] monarch butterfly. And here in the

[22:53] forests of Mituakan, there are millions,

[22:56] hundreds of millions.

[23:01] >> To see them ourselves, we rode with

[23:04] Omero Ari who grew up in these

[23:06] mountains. But it's incredible. Yes. You

[23:10] see the them here? Because it's becoming

[23:14] cold, they close the wings.

[23:16] >> That is one of the most spectacular

[23:18] sights I've ever seen.

[23:19] >> Yes.

[23:20] >> It is as if the trees are covered in a

[23:23] bark of butterflies.

[23:25] >> You have one on your arm.

[23:26] >> Ah, yes. They are welcoming us.

[23:30] The people of this region have known

[23:31] about the butterflies for generations,

[23:34] but it was only in 1975 that scientists

[23:37] were able to confirm that these are the

[23:38] very same butterflies that we see around

[23:41] the Great Lakes states in Canada in the

[23:43] spring and summer.

[23:47] Researchers followed the monarchs on

[23:48] their long autumn journey to these

[23:50] mountain tops in the state of Mituakan.

[23:53] They'll return north by spring, dying by

[23:55] the time they land in Texas. Over the

[23:57] summer, five generations will pass. How

[24:00] their offspring know to return to these

[24:02] same trees on these same mountaintops is

[24:05] one of the great mysteries of nature.

[24:08] It is why this region has become a major

[24:10] tourist destination. Visitors from

[24:12] around the world trek up the mountains

[24:14] with guides to see the mystical magical

[24:17] monarchs for themselves. Trina and

[24:19] Richard Luther came here from Mariposa,

[24:21] California. Mariposa, Spanish for

[24:25] butterfly. I never expected to hear the

[24:28] wings of the butterflies. How do I

[24:29] describe it? It won't fit in a camera. I

[24:31] can't capture it.

[24:33] >> The monarchs will only perch on the

[24:34] branches of a fur tree called OL found

[24:37] only in this region. They can wrap their

[24:40] tiny feet on the tiny needles. But the

[24:43] OL forests are under threat.

[24:45] >> What do we see here?

[24:46] >> Well, we see logging.

[24:48] >> This is a nature reserve. That logging

[24:51] is illegal. But as we ride through the

[24:53] forest, the slopes are littered with

[24:55] fallen trees and tree stumps. From the

[24:58] sky, you can see what's happening to the

[25:00] butterfly forest. This is a mountaintop

[25:02] in 2004. And here it is 4 years later.

[25:05] Look at the huge swath of brown where

[25:08] trees once stood.

[25:10] In this timber area, organized

[25:12] syndicates of illegal loggers routinely

[25:15] cut in forbidden zones.

[25:18] And so under international pressure, the

[25:21] Mexican government has deployed federal

[25:22] police in the area to try to curb

[25:24] illegal logging in the Monarch

[25:26] Mountains.

[25:29] >> The terrain is difficult to navigate,

[25:31] says the commander, which makes it

[25:32] difficult for us to operate.

[25:34] >> How do you protect the

[25:35] >> This is a work for the army.

[25:37] >> You need the army here.

[25:38] >> Yes, you need the army coming and

[25:41] looking asking questions to these

[25:43] people.

[25:44] But the army in this country has so much

[25:47] responsibility already, so many problems

[25:49] with drugs and drug traffickers and and

[25:51] violence.

[25:52] >> That is a big problem.

[25:53] >> The best hope may be those tourists.

[25:55] Tourism offers long-term stable jobs in

[25:58] the mountains and in the surrounding

[25:59] towns. After years of skepticism from

[26:02] the local population, advocates for the

[26:04] butterflies believe they are making

[26:06] progress. For 15 years, Eduardo Randon

[26:09] of the World Wildlife Fund has been

[26:11] working with communities in the area to

[26:13] build support for protecting the forest

[26:15] and to stop the logging.

[26:19] >> Tourism is a strategy that can help

[26:21] conservation, he says, because it's a

[26:23] way for people to take advantage of the

[26:24] forest without cutting down the trees.

[26:26] >> And do you think the people understand

[26:28] that?

[26:31] >> Definitely. He says, "15 years ago when

[26:33] I arrived here, people felt they were

[26:35] competing with the monarchs to use the

[26:36] forest. Today, that's not the case. If

[26:40] the forests are not protected, one of

[26:42] the great wonders of the natural world

[26:44] will disappear. For Omero Arigi, what is

[26:47] happening here is deeply personal. As

[26:49] Mexico's ambassador to UNESCO, he was

[26:52] instrumental in having the forest

[26:54] recognized as a United Nations World

[26:56] Heritage Site. The hope that world

[26:58] recognition will help persuade Mexicans

[27:00] to stop the logging.

[27:02] As the sun begins to set and the

[27:04] temperature drops, the monarchs and back

[27:06] to the trees.

[27:07] >> There is coming the night and they are

[27:10] just together hanging from the tree. And

[27:13] tomorrow when the sun comes out, they

[27:17] touch the the sunlight touches the wings

[27:20] and they they begin to open and begin to

[27:23] fly.

[27:24] >> It's like a It's like a work of art.

[27:26] Exactly.

[27:28] >> A masterpiece of nature under threat.

[27:31] I'm Jeffrey Kaufman for Night Line in

[27:33] Kipekc, Mexico.

[27:36] >> Just a sight to behold. Thanks to

[27:38] Jeffrey Kaufman for that. And we'll be

[27:40] right back.

[27:43] >> Monday, March 9th. Fighting crime.

[27:46] >> Tell me

[27:47] >> should never be by the book.

[27:49] >> You ever any fun? The cops got wild.

[27:51] >> You do know I'm wearing a gun. ABC's

[27:53] Castle series premiere Monday March 9th

[27:56] at 10:9 central on ABC.

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