Trump in Moscow: what happened at Miss Universe in 2013

Sitting in a makeshift studio overlooking the Moscow river on a crisp day in November 2013, Donald Trump pouted, stared down the lens of a television camera and said something he would come to regret.

Asked by an interviewer whether he had a relationship with Russian president Vladimir Putin, the brash New York businessman could not resist boasting. “I do have a relationship with him,” Trump said.

Russia’s strongman had “done a very brilliant job,” Trump told MSNBC’s Thomas Roberts, before declaring that Putin had bested Barack Obama. “He’s done an amazing job – he’s put himself really at the forefront of the world as a leader in a short period of time.”

Trump, a teetotaler, seemed intoxicated by the buzz surrounding the glitzy event that had brought him back to Moscow: that year’s instalment of the Miss Universe contest that he then owned.

Four years later, he is struggling to shake off the hangover.

The 2013 pageant has become a focal point for the simultaneous investigations, led by special counsel Robert Mueller and congressional committees, into whether associates of Trump colluded with Russian officials to help them win the 2016 US presidential election.

Investigators are examining closely efforts apparently made by the Russian government to pass Trump’s team damaging information on Hillary Clinton, using Trump’s politically-connected Miss Universe business partners as couriers.

They are also looking into the $20m fee that Trump collected for putting on the pageant from those same business partners – along with extraordinary allegations about Trump’s private conduct behind closed doors at the Ritz-Carlton hotel during his 2013 stay in Moscow.

The Guardian has learned of additional, previously unreported, connections between Trump’s business partners on the pageant and Russia’s government. The ties are likely to attract further scrutiny by investigators who are already biting at the heels of Trump associates.

A full accounting of Trump’s actions in the Russian capital as that autumn turned to winter may be critical to resolving a controversy that has already consumed the first eight months of his presidency.

“Our committee’s investigation will not be complete unless we fully understand who President Trump met with when he was over in Russia for Miss Universe, and what follow-up contacts occurred,” Eric Swalwell, a California Democrat on the House intelligence committee, said in an interview.

Trump’s attorney, John Dowd, declined to answer when asked whether the president’s team accepts that the Miss Universe contest is a legitimate area of inquiry for investigators. “Fake news,” Dowd said in an email.

‘Look who’s come to see me!’

It was a whirlwind courtship.

Trump was instantly taken with Aras Agalarov, the billionaire owner of the Crocus Group corporation, when the two wealthy property developers met for the first time on the fringe of the Miss USA contest in Las Vegas in mid-June 2013.

After just ten minutes of discussion, Trump was showing off his new friend. “He clapped me on the shoulder, gave a thumbs up, and started shouting, ‘Look who’s come to see me! It’s the richest man in Russia!’,” Agalarov recalled to a Russian magazine later that year, before clarifying that his fortune – estimated at about $2bn – was far from Russia’s biggest.

The meeting had been set in motion only a month earlier, when Agalarov’s son Emin, a pop singer who is well known in eastern Europe, filmed his latest music video in Los Angeles. His co-star was the reigning Miss Universe, a casting choice that brought the Agalarovs into contact with Trump’s beauty pageant division.

The idea of hosting that year’s contest in Russia was raised over dinner by Paula Shugart, Trump’s top Miss Universe executive, according to Emin Agalarov. In a little noticed interview published in July, Emin said Trump’s organization seemed to be in need of the money that Moscow could offer. “We have a lot of debts,” he quoted Shugart as saying. Miss Universe denies that Shugart said this.

In any case, a price tag of $20m to be paid by Agalarov in return for Trump bringing the Miss Universe contest to Russia was quickly agreed upon. Several Democrats have raised concerns that the payment – like the billions in bank loans he secured to bring himself back from the brink in the early 1990s – may have left Trump indebted to foreign influences.

“The pageant was financed by a Russian billionaire who is close to Putin,” Senator Al Franken of Minnesota told a congressional hearing in May. “The Russians have a history of using financial investments to gain leverage over influential people and then later calling in favours. We know that.”

Just four weeks after Emin’s video shoot, at the backslapping Las Vegas get-together, Trump announced that the deal was done. Miss Universe would be held at the Agalarov family’s sprawling Crocus City complex on the edge of Moscow, described by Trump as ”Russia’s most premier venue”.

In a dreary Vegas hotel banqueting hall, the beaming new business partners ate a celebratory dinner together. Video footage later obtained by CNN showed Trump at his most oleaginous. “What a beautiful mother you have,” he told Emin. The principals were joined by an assortment of hangers-on including Emin’s publicist – a portly Briton named Rob Goldstone.

It was Goldstone who would contact Trump’s son Donald Jr during the 2016 presidential campaign with a sensitive message, revealed in emails released last month. The “crown prosecutor of Russia” – assumed to be Goldstone’s garbled billing for Yury Chaika, the Russian prosecutor general – wanted the Trump campaign to have some documents that would “incriminate Hillary,” he said. And the Agalarovs would deliver them.

“This is obviously very high level and sensitive information but is part of Russia and its government’s support for Mr Trump – helped along by Aras and Emin,” Goldstone wrote. Rather than express surprise or question the apparent Kremlin operation Goldstone was describing, Donald Jr pressed ahead and arranged the meeting. “If it’s what you say I love it,” he replied.

Aras Agalarov made a suitable sherpa. While not a member of Putin’s inner circle, Agalarov cultivated friendly relations with the Kremlin while rising to the country’s oligarch class with a profitable network of shopping malls. He travelled around in a $44m Gulfstream private jet.

Less than two weeks before the Miss Universe finals, Putin awarded Agalarov the prestigious Order of Honor medal, after Crocus had completed for him a billion-dollar transformation of a former military base into a new state university.

“I wish to thank you so much for your work and contribution to the development of this country,” Putin told Agalarov and his fellow honorees. Crocus would go on to be further rewarded with more government construction contracts, including for stadiums that are to be used for next year’s soccer World Cup tournament in Russia.

Quietly, Agalarov and Crocus have also cultivated high-level relationships with Russian authorities on another front. They were established by one of Agalarov’s top lieutenants – Ikray “Ike” Kaveladze, a publicity-shy senior Crocus executive and the so-called “eighth man” at the 2016 Trump Tower meeting where Donald Jr hoped to receive dirt on Clinton.

While relatively unknown to the public before news of the meeting emerged in July, Kaveladze has in fact been an associate of some of Russia’s richest and most powerful people for the past three decades.

The Guardian has established that Kaveladze was involved in the $341m takeover of a US company by a Russian mining firm belonging to an associate of Putin, and was a business partner to two former senior officials at Russia’s central bank.

In 2003, the Colorado-based firm Stillwater Mining was bought by Norilsk Nickel, a metals corporation in Moscow led by Vladimir Potanin, one of Russia’s wealthiest oligarchs, who is so favoured by Putin that he has played on the president’s “Hockey Legends” ice hockey team .

As part of its $341m purchase of the American firm, Norilsk nominated Kaveladze to be one of its five handpicked directors on Stillwater’s new board, according to a filing by the company to the US Securities and Exchange Commission (SEC). Kaveladze was billed as the president of “an international consulting boutique” serving a “US and Eastern European clientele”.

The deal was the first time a Russian company had ever taken a majority stake in a publicly traded US company. It was viewed as critical by the Kremlin. Putin was reported at the time to have personally advocated for the deal’s approval by US regulators during a meeting with then-president George W Bush earlier in 2003.

Norilsk was then co-owned by Potanin and Mikhail Prokhorov, another major Russian oligarch, who later sold his stake. Prokhorov, who has had mixed relations with the Kremlin, now owns the Brooklyn Nets basketball team in New York. Kaveladze and Prokhorov had been classmates at the Moscow Finance Institute in the late 1980s and formed a partnership selling customised jeans between their studies.

Kaveladze’s ascent to the Stillwater board was eventually derailed, according to a source, after the discovery of his earlier involvement in a $1.4bn California-based scheme involving shell companies and transfers from Russia, which US authorities said may have been used for money-laundering. Norilsk said he withdrew from the process for personal reasons.

The Guardian previously revealed that Kaveladze’s partner in that operation was Boris Goldstein, a Soviet-born banker whose ties to former KGB officers attracted interest from US investigators after he moved to California in the early 1990s. In a remarkable coincidence, the US attorney in San Francisco whose office eventually declined to bring criminal charges over their alleged money laundering scheme was Robert Mueller, the special counsel now looking into Kaveladze’s reappearance.

Also previously unreported is Kaveladze’s close friendship with Andrei Kozlov, who was first deputy chairman of Russia’s central bank under Putin for four years before being assassinated in 2006 as he attempted to clean up Russia’s corrupt banking system. Allegations about who bore responsibility for his murder have swirled ever since.

At the turn of the 1990s, Kaveladze and Kozlov had gone into business together after graduating from the Moscow Finance Institute. They founded a small publisher and translator of financial books with Dmitry Budakov, another classmate, who also went on to be a senior executive at Russia’s central bank before running a division of the state-owned Bank of Moscow.

The young entrepreneurs capitalised on a hunger for financial literature among players in Russia’s rapidly privatising economy, pricing their textbooks at around $250. One book was published in Kaveladze’s name. His 1993 work, Protecting trade secrets in the US: A guide to protecting your business information, remains available in several university libraries.

According to an official history of that time, their book publishing outfit, ECO-Consulting, was established as a division of Crocus International, Aras Agalarov’s then-burgeoning business empire. In return for the security of being part of a larger corporation, Kaveladze and his business partners advised Agalarov on economic and financial affairs, according to a memoir of the time by Budakov. “Cooperation was mutually profitable,” he wrote.

Kaveladze soon moved to the US, landing first in Pennsylvania. He had earlier spent almost a month visiting the Gettysburg area after graduating in 1989. As a tribute to their departed guest, locals held a “Perestroika” 5,000-metre running race near the site of the Civil War battlefield as part of their Labor Day celebrations, according to the Gettysburg Times.

When Kaveladze moved to the US, he was adopted by a middle-aged couple in York, Pennsylvania, and later moved to New York. His adopted mother died in February 1993; her widower did not respond to requests for comment.

More than 25 years after their first venture, Kaveladze continues to work alongside Agalarov at Crocus. Their company has become one of the biggest corporations in Russia, carrying out government building contracts worth hundreds of millions of dollars from Putin’s administration – and sealing international deals with tycoons such as Trump.

‘Will he become my new best friend?’

Before leaving the US for his big Russian show in 2013, Trump made an unusual public appeal.

“Do you think Putin will be going to The Miss Universe Pageant in November in Moscow,” he asked on Twitter, and “if so, will he become my new best friend?” A source in Moscow told the Guardian that a meeting with Trump was indeed pencilled into Putin’s diary by aides, but fell off his schedule a few days beforehand.

Agalarov later said that Putin sent his apologies to Trump in the form of a handwritten note and a gift of a traditional decorative lacquered box. It is not known whether Trump met any associates of Putin in lieu of the president himself, but he certainly claimed to have.

“I was with the top-level people, both oligarchs and generals, and top-of-the-government people,” he said in a radio interview in 2015. “I can’t go further than that, but I will tell you that I met the top people, and the relationship was extraordinary.”

Having flown from the US overnight, Trump arrived in Moscow on 8 November and checked in to the Ritz Carlton hotel. It was a choice that has since become notorious. An opposition research dossier compiled for a private client by a former British spy, which was later published by BuzzFeed News, alleged that the Kremlin held compromising and lurid footage of Trump and a pair of prostitutes during his stay at the hotel.

Elsewhere in the dossier, author Christopher Steele wrote that two sources alleged Trump also had illicit sexual encounters in the Russian city of St Petersburg during a separate visit to the country. The sources, according to Steele, said that Aras Agalarov would “know the details”. Trump denies any wrongdoing.

It is plausible – but unproven – that attempts were made to surveil Trump during his trip.

“If you are in their field of interest then the FSB will absolutely attempt to carry out surveillance,” said a Russian hotel industry source, who did not want the name of his hotel mentioned due to the sensitivity of the topic.

The source said there was little that hotel managers could do about FSB demands, and that they are sometimes forced to provide access to rooms for agents. “In the bigger hotels you also definitely have a number of people on the staff who work on the side for the FSB, so they would have had absolutely no problem getting into the room if necessary.”

Putin said earlier this year that it was absurd to think the FSB would have bugged or secretly filmed Trump’s room in 2013, as he was not even a politician at that point. Russia did not simply bug every American billionaire who visited the country, according to the president.

But the hotel industry source cast doubt on that claim. “Surveillance doesn’t happen that often, but I’m pretty sure Trump would have been of a sufficient level to warrant it,” said the source. “I’ve seen people of lower levels than him watched for sure.”

When the late-night talk show host Stephen Colbert managed in July to gain access to the Ritz-Carlton’s presidential suite, where Trump is said to have stayed, an unexplained power cable was discovered dangling from a section of the bedroom wall that was hidden behind a non-illuminated mirror.

Whatever the truth about how closely Trump was being monitored by the Kremlin, a remark he made about Putin during that boast-filled interview with MSNBC seems particularly curious with the benefit of hindsight.

“I can tell you that he’s very interested in what we’re doing here today,” Trump said of the Russian president. “He’s probably very interested in what you and I are saying today – and I’m sure he’s going to be seeing it in some form.”

Some elements of Steele’s dossier have reportedly been confirmed by investigators, but other details have been shown to be false. And Trump has been backed up on the claims about his private conduct by Emin Agalarov. “While the world tries to figure out what Donald Trump was doing in a hotel in Moscow during Miss Universe – I actually know because he was filming my music video,” he wrote on Instagram.

Early in the morning of 9 November, Trump was taking part in filming at the hotel for the video of Emin’s single In Another Life. The video features Emin dreaming about being surrounded by bikini-clad Miss Universe contestants, before waking up to be lectured by Trump and told: “You’re fired”.

Yulya Alferova, a businesswoman and blogger who was hired by Crocus Group to help with their social media presence at that time, arrived at the hotel that morning and met Trump shortly after the filming had finished. After a brief conversation, Trump took a shine to her, and Emin invited her to join a small group for lunch.

“We talked about Twitter, and I asked him if he agreed that Twitter is the strongest and sometimes the most dangerous social media. He asked me about real estate, because I told him it’s one of my professional interests,” said Alferova, who once achieved notoriety in Russia for posting a photograph of her cat eating black caviar.

Later, Trump told her that she should contact him if she was ever in New York. He had his assistant hand her a business card. But there was nothing inappropriate about his conduct, Alferova said, describing Trump as a “gentleman” who always acted “correctly and properly” in their interactions.

The pageant went off without a hitch. Gabriela Isler of Venezuela was crowned the winner. An after-party was held for the contestants and friends of the organizers. There were three private boxes: one for the Agalarovs, one for Trump and one for Roustam Tariko, the chief of Russian Standard, the Russian vodka company and bank, which sponsored Miss Russia. The American band Panic! At The Disco provided the music, and contestants mingled with guests. Several were invited into the boxes to speak with Trump and the oligarchs. Aerosmith singer Steven Tyler, who had performed at the ceremony, was also there.

“Trump was still there when I left at 2am,” a guest at the party told the Guardian. “There were a lot of people there, it was fun but pretty civilised”. Alferova, the businesswoman and blogger, remembered multiple guests approaching Trump and asking for photographs with him.

“There were no government people present and no major Forbes List people except Aras [Agalarov] and Roustam [Tariko]” said one of the organisers of the event, suggesting Trump’s boastful claims that “all the oligarchs” attended may have been false.

Still, during his Moscow stay Trump also attended a private meeting with leading Russian businessmen at Nobu, the high-end Japanese restaurant chain for which Agalarov owns the Moscow franchise. The dinner was arranged by Herman Gref, Putin’s former energy minister and now chief executive of the state-owned Sberbank, Russia’s biggest bank. The bank, which was another sponsor of Miss Universe, was later among the Russian companies sanctioned by the US over Russia’s annexing part of Ukraine in 2014.

“He’s a sensible person, very lively in his responses, with a positive energy and a good attitude toward Russia,” Gref told Bloomberg.

Agalarov has said he and Trump also met with the businessmen Alex Sapir and Rotem Rosen – Trump’s old partners on the controversial Trump Soho project in New York – to discuss opportunities in Moscow. Agalarov later said they struck an agreement in principle to go ahead. Trump seemed to think so: “TRUMP TOWER-MOSCOW is next,” he said in a thank you note to Agalarov on Twitter. Eight days later, Sberbank announced it was lending Agalarov 55 billion rubles ($1.3bn) to finance new projects in Moscow.

Trump Tower Moscow, like so many other Russian twinkles in Trump’s eye over the past three decades, did not materialise. But it recently emerged that the conversations continued behind the scenes even after he began his long-threatened campaign for president.

In October 2015, four months into his campaign, Trump signed a “letter of intent” to build a tower in Moscow. Pulling the strings on the abortive deal was Felix Sater, yet another Russian business associate of Trump, who once served time in prison for stabbing a man in the face with a broken cocktail glass.

“I will get Putin on this program and we will get Donald elected,” Sater reportedly told Trump’s attorney in an email. “Buddy our boy can become President of the USA and we can engineer it … I will get all of Putins team to buy in on this.”

The future of Trump’s presidency may rest on what else was said and done relating to the project – and whether investigators who already smell blood can prove it.

On at least three occasions following the Miss Universe trip, Trump had publicly claimed to have met Putin. But when asked by reporters at a campaign stop in Florida in July 2016 to clarify the status of his relationship with the Russian president, as concerns over Russian election interference mounted, Trump gave a rather different version.

“I never met Putin,” said Trump. “I don’t know who Putin is.”

Wayne Rooney pleads guilty to drink-driving

Former England football captain gets two-year driving ban after pleading guilty to being almost three times over limit

Wayne Rooney has been banned from driving for two years after pleading guilty to being almost three times over the limit in what he described as a “terrible mistake”.

The former England captain, 31, has also been fined two weeks’ wages by his club, Everton, reported to amount to £300,000.

John Temperley, the district judge at Stockport magistrates court, said he would not impose a fine on the Everton forward and instead banned him from the roads for two years. He also sentenced Rooney to a 12-month community order with 120 hours of unpaid work.

“I’m sure you don’t need me to tell you this was a serious offence,” Temperley told Rooney. “You were driving a motor vehicle almost three times the legal limit and you were carrying a female passenger, which was an aggravating feature and you put other road users at risk.”

Rooney’s solicitor, Michael Rainford, told the court the player’s two-week fine by Everton was “not insignificant and it’s another form of punishment”. He added: “Through me Wayne wishes to express his genuine remorse for what was a terrible mistake and a terrible error of judgment on his behalf.”

He disclosed that Rooney had written a letter to the court expressing his remorse over the episode, in which he was pulled over in a VW Beetle when a police officer noticed one of its tail lights was not working at 2am on Friday 1 September. The car belonged to a woman the footballer had met in the Bubble Room bar in Alderley Edge.

When asked by the officer if he had been drinking, Rooney said he had had “a few”. Rainford said Rooney had been “a perfect gentleman” when he was arrested and that he stopped the car without being flashed.

In a statement issued after the plea, Rooney said: “Following today’s court hearing I want publicly to apologise for my unforgivable lack of judgment in driving while over the legal limit. It was completely wrong.

“I have already said sorry to my family, my manager and chairman and everyone at Everton FC. Now I want to apologise to all the fans and everyone else who has followed and supported me throughout my career.

“Of course I accept the sentence of the court and hope that I can make some amends through my community service.”

England’s record goalscorer smiled at a police officer as he left the court to a chant of “Rooney! Rooney!”, surrounded by a media scrum.

Kim Jong-un’s nuclear scientists take centre stage after missile test

Leader looking to cadre of weapons experts to realise ambition of developing missile that can carry nuclear warhead to US

Decorated by Pyongyang but blacklisted abroad, two scientists pictured with North Korea’s leader before Sunday’s nuclear test have emerged as playing vital roles in the ambitions of the rogue state’s leader, Kim Jong-un, say experts.

Photographs released by the official KCNA news agency hours before the test showed two men standing alongside Kim as he inspected a new peanut-shaped warhead, or perhaps a model of the bomb: Ri Hong-sop, the head of North Korea’s Nuclear Weapons Institute, and Hong Sung-mu, deputy director of the ruling Workers’ party of Korea’s munitions industry department.

North Korea’s sixth nuclear test on Sunday showed the country has either developed a hydrogen bomb – which has vastly more destructive power than atomic bombs – or is very getting close to obtaining one.

Several North Korea leadership experts say the two scientists are part of a cadre of weapons experts at the front line of Kim’s stated ambition: developing an intercontinental ballistic missile (ICBM) that can carry a nuclear weapon to the US.

Compared with his father, Kim Jong-il, and grandfather Kim Il-sung – who preferred small working groups and middle managers to deal with weapons programmes – the 33-year-old leader has been more personally involved with these scientists, experts say, citing his frequent appearances with the technocrats at state events, weapons tests and field inspections.

“It appears that Hong is spearheading the nuclear development programme as a senior party official and Ri is in charge of nuclear tests such as hydrogen bombs on a working level,” said Yang Moo-jin, professor at the University of North Korean studies in Seoul, who monitors the country’s hierarchy and leadership.

Reuters could not independently confirm the precise role of the two men. The North Korean government does not provide foreign media with a contact point in Pyongyang for comment by email, fax or phone. The North Korean mission to the UN was not immediately available for comment.

However, a Reuters review of North Korean state media showed the two scientists have become increasingly high profile as Pyongyang’s weapons programmes have advanced at a rapid pace under Kim’s leadership.

In January 2016, Hong and Ri were the first and second in line to receive medals personally awarded by Kim at a ceremony to mark the country’s fourth nuclear test, state television footage showed.

Two months later, they accompanied a smiling Kim inspecting a silver-coloured sphere, which the North said was a miniaturised warhead capable of being fitted to an ICBM.

The wider group of weapons technocrats includes a trio of rocket scientists who have accompanied Kim on several crucial missile launches, including two July ICBM test launches that showed much of the US mainland was now within range.

Like the three rocket scientists, Ri and Hong have been blacklisted in recent years by the UN, the US or South Korea for their roles in Pyongyang’s weapons programmes.

The UN blacklisted Ri in 2009, citing his involvement “in the production of weapons-grade plutonium”, while an expert UN panel this year noted Hong’s “key role in the country’s nuclear programme” as it recommended he also be sanctioned.

Ri is a former director of Yongbyon nuclear research centre, North Korea’s main nuclear facility north of Pyongyang. Yongbyon operates the country’s first nuclear reactors and its only confirmed uranium enrichment facility.

Siegfried Hecker, a nuclear science professor at Stanford University and one of the last Americans to visit Yongbyon, recalled meeting Ri during several visits there between 2004 and 2008. During one of these visits, Ri showed Hecker around the plutonium reactor and the radiochemical lab there.

Ri “stated with pride” that North Korea’s nuclear researchers have mastered plutonium production with no outside help, Hecker said in a 2006 report about his Yongbyon visit to Stanford’s centre for international security and cooperation. Hecker did not immediately respond to requests for comment about Ri or the North Korean nuclear programme.

Hong is a former chief engineer at Yongbyon and has been at the ruling party’s munitions department since the mid-2000s. He rose to prominence after Kim took power in December 2011 after the death of his father, according to a South Korean government database.

Hong, 75, has been seen accompanying Kim on nuclear tests and long-range missile launches since 2012, the South Korean database and pictures released by KCNA show. He was educated in central and eastern Europe and possibly in Russia as well, while Ri attended seminars abroad, said Michael Madden, an expert on the North Korean leadership.

“They are top-level officials and the last generation of those who studied in the old communist world,” he said.

North Korea nuclear crisis: Putin warns of planetary catastrophe

The Russian president, Vladimir Putin, has warned that the escalating North Korean crisis could cause a “planetary catastrophe” and huge loss of life.

“Ramping up military hysteria in such conditions is senseless; it’s a dead end,” he told reporters in China. “It could lead to a global, planetary catastrophe and a huge loss of human life. There is no other way to solve the North Korean nuclear issue, save that of peaceful dialogue.”

On Sunday North Korea carried out its sixth and by far its most powerful nuclear test to date. The underground blast triggered a magnitude-6.3 earthquake and was more powerful than the bombs dropped by the US on Hiroshima and Nagasaki during the second world war.

Putin was attending the Brics summit, bringing together the leaders of Brazil, Russia, India, China and South Africa. Speaking on the final day of the summit in Xiamen, China, he said Russia condemned North Korea’s provocations but said further sanctions would be useless and ineffective.

Foreign interventions in Iraq and Libya had convinced the North Korean leader, Kim Jong-un, that he needed nuclear weapons to survive, Putin said.

“We all remember what happened with Iraq and Saddam Hussein. His children were killed, I think his grandson was shot, the whole country was destroyed and Saddam Hussein was hanged … We all know how this happened and people in North Korea remember well what happened in Iraq.

“They will eat grass but will not stop their [nuclear] programme as long as they do not feel safe.”

Putin’s warning came as South Korea refused to rule out redeploying US tactical nuclear weapons on its territory – a move that could seriously harm efforts to ease tensions as signs emerged that Pyongyang was preparing to launch another intercontinental ballistic missile (ICBM).

Seoul has routinely dismissed the option of basing US nuclear weapons on South Korean soil for the first time since the 1990s, but the country’s defence minister, Song Young-moo, said “all available military options” were being considered to address the growing threat from North Korean missiles.

On Tuesday, South Korean warships conducted live-fire drills, with more exercises planned this week. “If the enemy launches a provocation above water or under water, we will immediately hit back to bury them at sea,” said Capt Choi Young-chan, commander of the 13th Maritime Battle Group.

The drills came hours after Donald Trump and his South Korean counterpart, Moon Jae-in, agreed to remove restrictions on the size of Seoul’s missile warheads and approved a deal to sell it “many billions of dollars’” worth of US military weapons and equipment.

Song raised the possibility of redeploying US nuclear weapons after the North’s nuclear test in remarks to the South’s national assembly, according to the Yonhap news agency.

But his remarks were later clarified, with spokesman Moon Sang-gyun saying there was “no change” in Seoul’s principle of working towards the complete denuclearisation of the peninsula.

Moon said Song had simply been stressing the need to “review all available options from the military perspective, and find a realistic way forwards”.

Kim Hyun-wook, a professor at the Korea National Diplomatic Academy in Seoul, said: “No one in South Korea is seriously proposing that the US reintroduce strategic assets [such as nuclear weapons]. That’s something they might discuss further down the line, but there are no plans for that to happen right now.”

Calls have also been growing in South Korea for the country to develop a nuclear deterrent independent of the US.

Song’s comments came amid reports that North Korea may be preparing to launch another ICBM from a site on its west coast.

North Korea has been observed moving what appeared to be a long-range missile towards its west coast, according to South Korea’s Asia Business Daily. The newspaper claimed the missile had been transported towards the launch site overnight on Monday to avoid surveillance.

South Korea’s defence ministry said it was unable to confirm the report, although ministry officials told parliament on Monday the Pyongyang regime was preparing to launch more missiles.

In the past, North Korea has displayed its military capability to coincide with significant national anniversaries. That is fuelling speculation that an ICBM launch could come as early as this Saturday, when the country marks the 69th anniversary of its founding. The regime’s fifth nuclear test came on the same date, 9 September, last year.

Washington appears to have moved to ease South Korean doubts about US commitment to its security after Trump openly accused its east Asian ally of “appeasing” Pyongyang by holding out for a negotiated solution to its nuclear and ballistic missile programmes.

The agreement from the US to remove warhead restrictions on South Korean missiles will allow Seoul to develop more powerful weapons that would increase its pre-emptive strike capabilities against the North.

Trump’s appeasement comment, together with his reported threat to take the US out of a free trade agreement with South Korea, have triggered calls for Seoul to win stronger security assurances from Washington.

In an editorial published on Tuesday, the Korea Herald said: “The Seoul government’s most urgent job is to secure – based on a tight alliance with the US – defence and deterrence capability against possible nuclear and missile attacks from the North.”

The newspaper called for the quick deployment of the last four of six terminal high altitude area defence (Thaad) systems, but said that was only a first step.

The diplomatic focus is expected to shift to the UN security council later on Tuesday, with a vote expected on a resolution condemning the North’s latest nuclear test.

One drastic measure reportedly under consideration by US officials – a ban oil exports to North Korea – is likely to be opposed by Russia and China.

Beijing supplies roughly 500,000 tonnes of crude oil to North Korea every year as well as 200,000 tonnes of oil products, according to South Korean and UN data.

China opposes any measure that could cause instability and topple the regime of Kim Jong-un, sparking a refugee crisis and potentially allowing tens of thousands of South Korean and US troops to move north as far as the Chinese border.

On Monday, the US ambassador to the UN, Nikki Haley, accused North Korea of “begging for war”, adding that the time had come for the security council to impose “the strongest possible” sanctions after Sunday’s test of what Pyongyang claimed was a hydrogen bomb that could be loaded on to an ICBM.

Monday briefing: South Korea simulates missile attack on North

Top story: James Mattis warns of ‘massive’ response

Good morning and welcome to the Guardian’s daily briefing. I’m Martin Farrer and these are the stories making waves this Monday morning.

South Korea has responded to Sunday’s nuclear test by North Korea with a huge show of military force as tensions in the region increased. The drills involved launching missiles in a simulated strike against its northern neighbour’s Punggye-ri nuclear test site. Joint drills with US forces are planned, military chiefs said. Seoul also appears poised to approve further deployments of a US missile defence system which will anger China and Russia, who think the Thaad system could be used by the Americans to spy on them.

US defence secretary James Mattis said Washington would respond to any attack on American soil with “massive” force while Donald Trump said Pyongyang’s actions were “very hostile”. The South Korean president, Moon Jae-in, held telephone talks with Japanese prime minister Shinzo Abe after agreed greater pressure is needed on North Korea, including stronger United Nations resolutions.

In Beijing, Xi Jinping is facing a lack of options over how to deal with the North Koreans according to academics and China-watchers, one of whom says the Chinese are “pissed off” with their bind. Our correspondent Tom Phillips dissects what Xi might do.

Justice system shake-up – A report into deaths in police custody will find that families who have lost loved ones have been failed by the system in their battle for answers, the Guardian has learned. The report, which is yet to be published, recommends major reforms such as a ban on those detained under mental health powers being held in police cells and being transported in police vehicles, and free legal advice for families of those who have died in custody. The report by Dame Elish Angiolini QC, which is nearly 300 pages long, will be a landmark in police-community relations when it is published.


Brexit battle – Theresa May and David Davis will attempt to navigate a potentially stormy week by warning any Tory backbenchers thinking about rebelling over the Brexit bill should get into line or risk handing the keys of No 10 to Jeremy Corbyn. Critics of the European Union (withdrawal bill), which will be given a second reading on Thursday, say it does not allow for enough parliamentary scrutiny of new laws. But the Brexit secretary will use a Commons address on Tuesday to say that passing the bill is in the interests of MPs on all sides. The EU’s chief negotiator, Michel Barnier, upped the ante on Sunday by saying that the British people needed to be “educated” about the consequences of Brexit.

A poll by the thinktank British Future today shows that four out of five people who voted leave in the EU referendum would accept migration of high-skilled workers from the bloc to increase or stay the same. But remain and leave supporters back a reduction of low-skilled workers.


The big walkout – Staff at two branches of McDonald’s will go on strike today after a ballot in favour of action amid concerns over low wages and the use of zero-hours contracts. Around 40 staff in Cambridge and Crayford in south-east London are demanding a wage of at least £10 an hour, more secure hours and union recognition. Rail workers at Southern, Arriva and Merseyrail are also on strike today in disputes over the role of guards and driver-only services. The action on will disrupt travel as people return to work after the holidays and schools reopen.


UN aid blocked – The crisis engulfing Rohingya Muslims in north-west Myanmar appears set to deepen after it emerged that the UN has been prevented from delivering aid to the area amid a bloody army crackdown. The UN’s Myanmar office told the Guardian’s south-east correspondent, Oliver Holmes, that deliveries were suspended “because government field-visit restrictions rendered us unable to distribute assistance”. Pakistani rights activist Malala increased pressure on Myanmar leader Aung San Suu Kyi by saying the “world is waiting” for her to stop the violence.


Retirement call – The TUC says the government should use productivity gains from the greater use of robots and artificial intelligence to reverse planned changes to the state pension age. Before its annual congress starting on Sunday in Brighton, the TUC said innovation ought to bring greater benefits for working people instead of benefiting only the owners of businesses.

Lunchtime read: A Portrait of Britain

What does Britain look like in the late summer of 2017? One answer is suggested by a collection of 100 photographs that will go on display at railway stations and shopping centres across the country until the end of the month. They include Grenfell Tower survivor Corinne Jones, septugenarian Cornish surfer Gwyn Haslock and actor Warwick Davis. They also include a portrait by Sian Davey of her daughter Alice, who has Down’s syndrome, aimed at charting “fear and uncertainty” on the path to unconditional love.

Sport

Lewis Hamilton is in pole position in the F1 world championship after winning the Italian grand prix on Sunday, and says he enjoys being the “villain” in the title race. Gareth Southgate is beginning to get the feeling of what it’s like to be the villain of English football as he rejected suggestions that his team lack pride in playing for their country after his team’s lacklusre win over Malta on Friday. They play Slovakia at Wembley tonight.

In the US Open tennis, there’ll be no fairytale return from her drug ban for Maria Sharapova who was beaten by Anastasija Sevastova overnight, while Venus Williams might just get a glorious swansong after she reached the quarter finals.

Business

Investors turned to safe havens such as the yen and gold this morning when the financial markets opened for the first time since news of North Korea’s nuclear test. It was bad news for Japanese stocks, however, and the Nikkei dropped almost 1% because exporters are likely to suffer from the higher currency. Gold hit a 10-month high to stand at $1,335.90.

The pound is up slightly at $1.295 and €1.089.

The papers

The Sun splashes with the troubles of Wayne Rooney after he was arested for drink driving. The headline is “Wayne thinks it’s all over”. The Mirror also features Wayne’s worldy worries, but the main story is that 460 people are dying every year while waiting for a transplant organ.

The FT has a startling headline: “Trump opens door to attack on North Korea after “H-bomb” test. The Telegraph also goes on that story with “US warns it is ready to annihilate North Korea”, while the Times reports Boris Johnson’s response to Kim Jong-un’s tests saying he does not “see an easy military solution” to the problem.

The Mail believes the most important story of the day is news that you could get fined heavily for putting your bins out too early, or filling them too full. To be fair it also mentions North Korea on the front. As does the Guardian, although it splashes on an as yet unpublished report into deaths in police custody which is recommending far reaching reforms.

For more news: www.theguardian.com

Duchess of Cambridge pregnant with third child

The Duke and Duchess of Cambridge are expecting a third child, Kensington Palace has announced.

The announcement was made as the duchess was forced to cancel an engagement on Monday because of extreme morning sickness, or hyperemesis gravidarum.

In a statement, Kensington Palace said: “Their royal highnesses the Duke and Duchess of Cambridge are very pleased to announce that the Duchess of Cambridge is expecting their third child.

“The Queen and members of both families are delighted with the news.

“As with her previous two pregnancies, the duchess is suffering from hyperemesis gravidarum. Her royal highness will no longer carry out her planned engagement at the Hornsey Road children’s centre in London today. The duchess is being cared for at Kensington Palace.”

The announcement comes in the same week as four-year-old Prince George is due to start school at Thomas’s Battersea, south London. Princess Charlotte is two.

Hyperemesis gravidarum can be so acute that it requires supplementary hydration, medication and nutrients.

Kate, 35, was admitted to hospital because of morning sickness during her first pregnancy.

The baby will be fifth in line to the throne – bumping William’s brother, Prince Harry, down to sixth place. Until recently, if the Cambridge’s new baby was a boy it would have leapfrogged Charlotte in the line of succession. Under the rules of male primogeniture, royal sons took precedence over female siblings.

A radical shake-up, before the birth of Prince George and affecting babies born after 28 October 2011, removed discriminatory male bias. It meant the Cambridge’s first child, regardless of gender, would be destined as monarch, and it means Charlotte retains her position even if she has a younger brother.

It is likely Kate will chose to have her baby in the Lindo wing of St Mary’s hospital, Paddington, where she has already experienced two straightforward deliveries. The couple have a live-in nanny.

Having chosen traditional royal names for their first two children, bookies’ odds are likely to be short on Alice or Alexandra for a girl, and James or Philip for a boy.

Royal observers had indicated it was likely that the couple would have three children.

Kate is one of three, with a sister, Pippa Matthews, and brother, James Middleton. On a royal tour of Poland in July 2017, Kate joked abut having a third after being given a present designed for newborns, turning to William and saying: “We will just have to have more babies”.

William, 35, who is one of two siblings, may not initially have been convinced. On an overseas tour of Singapore in 2012, when asked by a group of teenagers how many children he would like to have, he said he was “thinking about having two”.

He recently gave up his part-time job as an air ambulance helicopter pilot for East Anglian air ambulance to take up full-time royal duties as the Duke of Edinburgh stepped down from his royal work.

William and Kate, who have a property on the Queen’s Sandringham estate, Anmer Hall, in Norfolk, will be based in Kensington Palace during the week.

Brexit healthcare deal is ‘good news for pensioners’

British pensioners who have retired to other EU countries will continue to have their healthcare paid for by the NHS post-Brexit, after a deal in principle was agreed by negotiators in Brussels.

In one of the few advances made in discussions about EU citizens’ future rights, the Brexit secretary, David Davis, said there had been agreement on four key areas, including reciprocal healthcare for British and EU retirees affected by Brexit.

“This is good news for British pensioners in the EU,” he said.

Other areas of agreement included protection for “frontier workers”, those who live in one EU member state and work in another. This would include people who live in the UK and commute to Europe, or Britons settled in one country, for example Germany, who commute to work in another, say Luxembourg.

Also, professional qualifications would be recognised across the bloc after Brexit, allowing lawyers, doctors, accountants, seafarers, train drivers and others who have moved to or from the UK to another EU country to work under their existing credentials.

There was also agreement to coordinate on social security post-Brexit. However, there was still disagreement on more than half the issues discussed, including the eventual oversight of the legal rights of EU citizens.

The EU’s chief negotiator, Michel Barnier, hinted that Brussels was insisting that such oversight should be held by the European court of justice – a “red line” for Britain.

In his opening address at the press conference after the third round of talks, Barnier raised serious concerns about the Home Office’s capacity to oversee or police any deal on EU citizens’ rights given the recent debacle when it mistakenly sent letters to about 100 EU citizens, threatening deportation.

“The UK quickly recognised that it was a mistake, but this is not the first time this has happened and it reinforced the point that [this] needs to be under the control of the ECJ, a point [on] which we disagreed today,” Barnier said.

British pensioners across Europe will be relieved, however, that there has been progress on reciprocal healthcare rights.

According to figures issued to a parliamentary select committee this year, Britain spends £650m reimbursing other EU countries for treating British patients. Of that, about £500m goes on 190,000 registered pensioners, including 70,000 in Spain, 44,000 in Ireland, 43,000 in France and 12,000 in Cyprus.

The agreement will allow a British pensioner who has retired in another EU country to travel to other EU countries on holidays and use the existing European Health Insurance Card should they need medical attention.

It is understood Britain was pushing for this agreement to cover British tourists as well, but the EU said it was not an issue to be discussed in a deal for EU citizens.

Twenty-seven million Ehic cards have been issued in Britain.

Davis said EU citizens would remain “a top priority” and there had been a wide range of agreements in discussions this week.

It is understood Britain reiterated its commitment not to enforce the requirement that EU citizens who are “self-sufficient”, including students and stay-at-home parents, have private health insurance. They will be able to be treated by the NHS.