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NANCY GRACE

Report Father-in-Law a Person of Interest in Susan Powell Disappearance

Aired February 7, 2012 - 20:00   ET

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


NANCY GRACE, HOST: Breaking news tonight, live, Utah, the mystery surrounding the disappearance of a gorgeous young stockbroker, mother of two, 28-year-old Susan Cox Powell, last seen when Daddy suddenly announces at midnight on a Sunday night he`s taking the boys, ages 4 and 2, camping in the snow. They get back home, Daddy says Mommy`s gone.

And now more tragedy for Susan`s family, husband Josh Powell`s home exploding in a towering burst of flames. Inside, Josh Powell, and in a bitter twist, Susan`s beloved little boys, Josh Powell inflicting the greatest pain ever on Susan and her family in a suicide-double homicide of the children, ages just 5 and 7.

Bombshell tonight. Stunning reports just released reveal Powell actually hacks his own two boys with a hatchet to their necks just before the children perish in smoke. Official COD -- cause of death -- carbon monoxide. We learn Powell stages the scene before blowing it up in a gasoline blast, hanging portraits and photos of Susan all throughout the home, multiple five gallon gas cans planted in the home, as well. Tonight, Josh Powell`s family defending him!

And in a bizarre twist, at this hour, we learn Josh`s father now named a POI -- person of interest -- in Susan`s disappearance. And tonight, all the warnings were there, Powell buying gas, buying gas cans, cleaning out the children`s toys and belongings to give away, even arranging his utilities cut off.

And bitter recrimination after it is revealed the two boys go so far as to actually draw pictures of Mommy in the car trunk and give the drawings to their teacher. They told people, Mommy`s in the car trunk. Mommy`s in the mines looking for crystals.

Then Mommy disappears, the two eyewitnesses to Susan`s disappearance, the children. Why wasn`t Powell behind bars instead of out free to murder his two little boys?

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: (INAUDIBLE) the grandfather (INAUDIBLE) him in jail for the voyeurism and the child pornography.

UNIDENTIFIED MALE: Those pictures of Susan in different states of undress. And she obviously didn`t know her picture was being taken.

UNIDENTIFIED MALE: Josh`s dad tells ABC`s "Good Morning America."

STEVEN POWELL, SUSAN POWELL`S FATHER-IN-LAW: Susan was very, very sexual with me. She was very flirtatious. I mean, I`m her father-in-law, and she would do a lot of things that -- that -- I mean, she was just -- she did it. I did. I mean, we interacted in a lot of sexual ways because Susan enjoys doing that.

UNIDENTIFIED FEMALE: Do you think a part of you started falling in love with Susan?

STEVE POWELL: That`s pretty likely, yes. I mean, I -- yes, I would say so. And I -- and there`s no question in my mind that the feelings were mutual.

UNIDENTIFIED MALE: Steven Powell certainly didn`t help things. It was a cycle of evil.

UNIDENTIFIED MALE: Everything he`s saying about Susan and him having any type of relationship -- flat-out lie.

UNIDENTIFIED FEMALE: She said that her father-in-law gives her the creeps.

JOSH POWELL, HUSBAND OF SUSAN POWELL: This is Josh. I`m calling to say good-bye.

UNIDENTIFIED MALE: We found two five-gallon cans of gas. One of them was with the bodies.

JOSH POWELL: I am not able to live without my sons and I`m not able to go on anymore.

UNIDENTIFIED FEMALE: The police say they also found a hatchet in the home. It appears that the father hit the boys with it.

JOSH POWELL: I`m sorry to everyone I`ve hurt. Good-bye.

UNIDENTIFIED FEMALE: Selfish, a coward.

JOSH POWELL: I would never hurt my boys. I would never hurt anyone.

(END VIDEO CLIP)

GRACE: That`s from ABC`s GMA, "Good Morning America."

Good evening. I`m Nancy Grace. I want to thank you for being with us. Bombshell tonight. Reports just released reveal Josh Powell actually hacks his own two boys with a hatchet to their necks before the children perish in smoke. And in a bizarre twist, at this hour, we learn the creepy father-in-law now named a POI -- person of interest -- in Mommy`s, Susan Cox Powell`s, disappearance.

We are taking you live to the scene. Standing by, reporter with Seattlepi.com Casey McNerthney, there at the Powell home. Casey, thank you for being with us. What do you see?

CASEY MCNERTHNEY, SEATTLEPI.COM: It`s a pretty devastating scene, Nancy. We were here just after the fire, and it hasn`t gotten much better. Neighbors are in shock. It`s just a burned shell. This was, from what police say, a very deliberate, calculated attack that left two vulnerable kids dead.

GRACE: I see behind you everything is completely charred, which indicates to arson detectives or people that have prosecuted arson homicides, the immediate charring -- there`s nothing left of the home. That says accelerant because, typically, with an arson, there`s something left of the home unburned.

Describe to me the devastation and how the burn marks are helping explain what happened, telling arson investigators what exactly went on.

MCNERTHNEY: What we know from investigators is that they found two gas cans at the home. One was near the boys, where they were found dead. And what is most shocking, I think, is a neighbor told me that he was asleep about 150 yards away. It -- the initial shock was so loud that it woke him from a sleep. And neighbors said that they had never seen a fire quite like this. It seemed so deliberate, from what they saw and how quickly it burned. And certainly, from the debris we see here, it does go to what police say, that it was a very calculated, malicious, heinous act.

GRACE: Also joining us there at the scene at Josh Powell`s home, the scene of the devastation, the fire that killed both Josh Powell and his two little boys -- joining us, CNN correspondent Thelma Gutierrez. Thelma, thank you for being with us.

What have we learned about the autopsy reports, about the children`s bodies?

THELMA GUTIERREZ, CNN CORRESPONDENT: Nancy, it`s so hard to report. The autopsy reports are showing that the children actually suffered chop marks to their necks before they died of carbon monoxide poisoning. The hatchet was actually found here in the rubble.

Yesterday, Nancy, we were on the air with you. We talked about the arson investigators who were combing through this rubble. They found the hatchet in the ashes.

I want to pan over, Nancy, to just show you what this looks like. The devastation is so complete. Those kids walked in through that doorway. You can barely make it out right now through the frame. They were yanked inside by their father. The social worker tried to pound on the door to get back inside because she smelled gasoline. At that point, she goes to call her supervisor, and this thing explodes into flames.

If we pan right over, you can see what appears to be a living room. The bodies of those children and their father were found right there in that living room, and they were all together in the middle of the room.

When I look at this, what really stands out, Nancy, is the utter devastation and the irony of actually seeing a picket -- a white picket fence right off in the yard. And the whole thing is so incongruent, especially when you hear about how these children died.

GRACE: Back to Casey McNerthney, reporter from Seattlepi.com. Thelma has just revealed about the hatchet. Reports were trickling in for -- out last night regarding the autopsy report. And at first, it said the children underwent a, quote, "karate chop" to the neck. It got worse. We now know what Thelma just reported, that there was actually a hatchet wound to the boys` neck.

Describe about how they found the hatchet. Where was the hatchet that Josh Powell used?

MCNERTHNEY: We`ve heard from police that the hatchet was near the boys. And as police told me, if he tried to do something to ease their pain, it failed. They died certainly in anguish. And that`s -- when you think that this case can`t get any worse, you hear that detail. And it`s just so shocking that the boys had hatchet cuts to their head and neck, and then ultimately it was -- it was -- it was...

GRACE: That was not the ultimate cause of the death, you`re right, Casey McNerthney.

And I want to go very quickly to Dr. Michelle DuPre, medical examiner, forensic pathologist joining us out of Columbia. Dr. DuPre, if he had tried to lessen their suffering, what he did was actually make their suffering worse. How can you tell the children didn`t die from the axe wound to the neck, they died from carbon monoxide inhalation. Explain. How you can determine that?

DR. MICHELLE DUPRE, MEDICAL EXAMINER/FORENSIC PATHOLOGIST: Well, sure. You would take blood samples, Nancy, and find carboxy hemoglobin in those blood samples. Also looking at the airway, you will see soot notice -- making the assumption that they then took breaths.

GRACE: So that means, Dr. DuPre, that they were breathing after the hatchet blow, the chop to their necks.

And the crazy part, Jim Kirkwood, host at KTKK, joining us, is that he was not insane, Jim Kirkwood. Any seasoned arson investigator looks at a checklist of about 10 things to help determine arson, and one of those things are -- is, Do you remove things from the home? And here we`ve got him not only arranging to have his utilities cut off, but also cleaning out the boys` toys and belongings and giving them all away in the days leading up to this gasoline blast.

What do you know, Jim Kirkwood?

JIM KIRKWOOD, KTKK (via telephone): Well, this was carefully planned. And as your pathologist pointed out, those poor children, Nancy, they died a miserable, horrible death, unimaginable. They -- and he carefully planned it with the purchase of the gasoline, and he had to sprinkle it all through the house. There are reports, unconfirmed, that the children`s bodies were sprinkled with gasoline, and probably his own. And there were three separate explosions...

GRACE: Whoa! Wait! Whoa-wait! Wait, wait! Jim, did I just hear you say that there are reports now emerging the children`s body themselves were doused with gasoline?

KIRKWOOD: Not confirmed, but I`ve heard those reports, yes.

GRACE: I want to go to Denise Cox. This is Susan`s sister. This all started one snowy night about 14 degrees outside on a Sunday night when this gorgeous young mom just 28 years old -- You`re seeing Susan Cox Powell in these photos with her beloved children -- goes missing.

Denise, has your family been made aware that there are reports the children had gasoline on them, as well -- he put gasoline on the children?

DENISE COX, SUSAN POWELL`S SISTER: As far as I know, they haven`t said anything to me about that. They tried to conceal what the autopsy report was for a while because they didn`t want to upset us even more. They didn`t tell me about that. And since -- I`m hoping it`s not true. But again, with Josh, he`s capable of anything.

GRACE: To Kevin Berry, bomb and explosives expert, retired first- grade detective at NYPD. Kevin, how can they tell, since everything was burned to a crisp -- how can they tell that there was gasoline on the children`s bodies?

KEVIN BARRY, BOMB/EXPLOSIVES EXPERT (via telephone): They`ll take a chemical analysis on that, and they`ll be able to tell if accelerants were used.

GRACE: What`s so disturbing, along with everything else, Jim Kirkwood, KTKK, is that all the warning signs were there.

KIRKWOOD: Yes.

GRACE: The boys had gone so far as to draw pictures.

Take down the fire! I want to see Susan, the mother. They drew pictures of their mother in the car trunk. When they were asked to draw, What did you do on your vacation, they draw their Mommy in the car trunk. They show it to their teacher. They told people, Mommy`s in the trunk. Mommy`s looking for crystals in the mine. Mommy`s disappeared.

Why wasn`t he behind bars, Kirkwood? Why?

KIRKWOOD: West Valley police have been very careful. They`re still being careful. Conversations earlier today with a number of people over there -- they`re to the point, Nancy, where they`re not denying anything, but they`re not confirming much, either.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Do you think a part of you started falling in love with Susan?

STEVEN POWELL: Yes, I would say so. And -- and I -- and -- and there`s no question in my mind that the feelings were mutual.

UNIDENTIFIED FEMALE: And you knew about this.

JOSH POWELL: She`s a very flirtatious person.

This is Josh. And I am calling to say good-bye. I am not able to live without my sons. And I`m not able to go on anymore. I`m sorry to everyone I`ve hurt. Good-bye.

(END VIDEO CLIP)

GRACE: Josh Powell`s final voicemail, obtained exclusively by ABC News, which clearly shows he`s not insane. He planned the whole thing out. And that leads me to the latest bombshell.

To Casey McNerthney joining us, from Seattlepi.com. What can you tell me about Josh Powell`s father, Susan`s father-in-law, being a person of interest in Susan`s disappearance that night?

MCNERTHNEY: We know the police very badly want to talk to him and know -- find out exactly what he knows about Susan Powell and her disappearance. It`s interesting, what was said earlier, that police aren`t denying anything, but they`re also not confirming much, either.

They have him on suicide watch. When he first told -- was told about what happened here at the house, he had a lot of derogatory remarks for police, and you know, said some pretty nasty things, although he did seem very calm. So they`re interested to see if maybe he knew something about this or thought that something tragic like this might have happened.

But even though he`s not being cooperative now, they want to keep him alive to see if they can find out more, if he knows more about Susan Powell`s disappearance.

GRACE: Weigh in. To Clark Goldband, also on the story. What do we know about her own father-in-law, Josh Powell`s father, now being named as a person of interest in her disappearance that night?

CLARK GOLDBAND, NANCY GRACE PRODUCER: There are local reports that are saying at this hour that, in fact, his father is a person of interest. And when law enforcement confronted Powell behind bars on this, he wasn`t only uncooperative, he called them many names, and in fact, is on suicide watch tonight, Nancy.

GRACE: So you know, you`re putting perfume on the pig, Clark Goldband. As a matter of fact, when they come and tell him about the explosion in Josh Powell`s home he, A, was not surprised. He cursed them out, was not emotional, no crying, nothing. He basically cursed the cops out. Is that more like it, Clark?

GOLDBAND: Yes, Nancy.

GRACE: I want to go to Steve Downing, the family law attorney for Chuck and Judy Cox. Steve, is it true that the boys drew the photo of Mommy in the car trunk, and the teacher saw it, and they apparently gave the picture to their father, of all people?

STEVE DOWNING, FAMILY LAW ATTORNEY FOR SUSAN POWELL`S PARENTS (via telephone): That`s correct, Nancy. And as the children began to live with the Coxes, they felt more comfortable, they felt safe. They began making even more disclosures, and so they were beginning to feel comfortable to disclose.

GRACE: What more did the children have to do, put up a billboard on Times Square?

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: There was a big explosion. It shook the house.

UNIDENTIFIED MALE: Powell ushers his sons inside, locks out the social worker, and does the unthinkable.

UNIDENTIFIED MALE: Slaughtered two innocent children.

UNIDENTIFIED FEMALE: To regain control over what was going on. He was very controlling.

UNIDENTIFIED MALE: They seemed to be losing interest in going to see him.

UNIDENTIFIED MALE: In a horrific explosion set, police say, by Josh Powell himself.

UNIDENTIFIED MALE: Two five gallon cans of gas. One of them was with the bodies.

JOSH POWELL: I`m sorry to everyone I`ve hurt. Good-bye.

(END VIDEO CLIP)

GRACE: Why wasn`t Josh Powell behind bars, where he belonged, for the death of his wife, Susan Cox Powell, the mother of his two little boys, these boys perishing in a blaze, a gas bomb (ph), in Powell`s home. We now learn -- autopsy leaks during the night -- the two little boys sustained hatchet chops to their necks. But they didn`t die from that, they died from carbon monoxide inhalation. They suffered intensely. Now reports the boys` clothing was doused with gasoline. It`s almost too much to take in.

I want to go back to the family attorney, joining us tonight exclusively. Also with us, Susan`s sister, speaking on her behalf and on behalf of her, Susan`s, family. Steve Downing, when did you first learn the children were saying, Mommy in the car trunk, Mommy`s in the mines looking for crystal, Mommy disappeared?

DOWNING: That was finally disclosed to us sometime in the summer of 2011. So they had made that disclosure quite some time before, and the first I learned of it was the summer of 2011.

GRACE: Steve, why, given that information and the treasure trove of circumstantial evidence -- why hadn`t Josh Powell been already put behind bars?

DOWNING: Nancy, that is the question that we have had for months. My clients were assured repeatedly by the West Valley Police Department that an arrest was pending, be patient. Then an arrest was pending. They were told repeatedly that something was going to happen, and it never did.

GRACE: You know, Steve Downing, I feel very strongly the system, the police, let these boys down. Child witnesses have testified thousands and thousands of times in court. And maybe their lives could have been saved.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: It shook my house.

UNIDENTIFIED MALE: We have three bodies, two kids and an adult.

UNIDENTIFIED MALE: The bodies of Joshua Powell and his two sons.

UNIDENTIFIED MALE: This is something we believe that was done intentionally and done with malice.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: A mini van and he said they asked him what was the picture about. And this was at a preschool that he was going to. And he told -- there were three or four people there watching as he was doing this. And he said that was a picture of him, of his family going camping. And they said, who are the people? Well, it`s mommy, daddy, and me. Mommy -- no, not mommy. I`m sorry.

In the mini van there was daddy, Charlie, and me. So Braden. And he said, and then he said, mommy was in the trunk, which got the attention of the preschool people, of course, knowing what was going on. And then he said that they had stopped somewhere. Daddy and mommy, they stopped, and mommy and daddy got out and mommy didn`t come back. So that`s the -- how that came from based on a picture. The picture was given to Josh. The picture is gone. We don`t know -- have that picture.

JOSHUA POWELL, HUSBAND OF MISSING MOM SUSAN POWELL: This is Josh. And I am calling to say goodbye. I am not able to live without my sons. And I am not able to go on anymore. I`m sorry to everyone I`ve hurt. Goodbye.

(END VIDEO CLIP)

NANCY GRACE, HLN HOST: Josh Powell`s final voicemail obtained by ABC. And at this hour we learned his father, Susan Cox Powell`s father-in-law, named a person of interest in her disappearance.

We are taking your calls. To Denise, this is Susan Cox Powell`s sister, Denise Cox. What is the family reaction to the fact that her father-in-law, who was clearly obsessed by her, obsessed with her, has now been named a person of interest in her disappearance and death?

DENISE COX, SISTER OF MISSING MOM, SUSAN COX POWELL: I don`t know why they waited so long to name him a person of interest. He`s always been a person of interest in my mind, and they both, to me, been suspects and they both, to me, are guilty.

GRACE: To Paula Bloom, clinical psychologist.

Dr. Bloom, what more did the little boys have to do? I mean, I`ve had to put child witnesses on the stand before there was DNA evidence in, for instance, child molestation and rape cases, and get them to verbalize in their own way, for instance, a rape, a molestation, a murder. It`s very difficult, but it can be done.

What else did they have to do, take out a billboard? They drew pictures of mommy in the car trunk. They said, mommy is in the trunk. Mommy is in the mines looking for crystals. Mommy disappeared. What more did they have to do, Paula?

PAULA BLOOM, CLINICAL PSYCHOLOGIST, BLOGGER, PAULABLOOM.COM: Right. You`re right. You know children communicate through their drawings and they communicate through play, which is why a lot of child therapists look at drawings and look at play.

My question is, the person who all of this was told to was not a psychologist or a trained professional, and was not somebody in law enforcement is my understanding. So it`s very easy for people to not fully appreciate the moment.

GRACE: It was a teacher.

BLOOM: Right.

GRACE: The cops knew about it.

BLOOM: Right.

GRACE: The family lawyer just told us that.

Didn`t the cops know about their statements, Steve Downing?

STEVE DOWNING, FAMILY LAW ATTORNEY FOR PARENTS OF MISSING MOM, SUSAN COX POWELL: Absolutely.

GRACE: Unleash the --

DOWNING: And officials --

GRACE: Officials were told.

Kirby Clements, defense attorney, Atlanta, high-profile lawyer out of Seattle, attorney for Chuck and Judy Cox, Anne Bremner. Of course with us Steve Downing, the family lawyer for Chuck and Judy Cox.

What about it, Anne Bremner? What more did the children have to do?

ANNE BREMNER, ATTORNEY FOR FAMILY OF SUSAN COX POWELL: Nancy, amen to you. I mean take out a billboard in Times Square. Steve and I have worked of course with Chuck and Judy. And we knew about the "mommy`s in the mine" statement years ago and the police knew about it. And more recently, like Steve said, they`ve been saying more. These kids could testify. Law enforcement knew about it and amen to you, Steve, in saying law enforcement was so frustrating in this case. Because they did keep telling Chuck and Judy that they were close, that there was going to be an arrest.

(CROSSTALK)

GRACE: And to you, Kirby -- Kirby Clements, you and I prosecuted together in the same courthouse before you became a defense lawyer. Even way back then we were trained as to how to get information from child witnesses and put them on the stand. Nobody wants to do it, Kirby, but maybe this could have been averted. This could have been averted, Kirby.

KIRBY CLEMENTS, DEFENSE ATTORNEY: Absolutely, Nancy. As a matter of fact, they could have gone to a judge to get an arrest warrant for this man. I mean, at a minimum for kidnapping. So the fact -- they didn`t have to go to putting the child on the witness stand. They just had to go and say we got a missing woman. These children have said that their mother was in the trunk and now she`s out in the mines and she didn`t come back. And they could have gotten an arrest warrant for some charge.

GRACE: Easy. Easy.

CLEMENTS: To keep that man away from those kids. Absolutely.

GRACE: The issue of putting a child witness on the stand has long been accepted as no barrier to going to trial.

To Steve Moore, former FBI agent, violent crime investigator.

Steve, it`s routine to use children as witnesses whether we like it or not. Josh Powell should have been behind bars, bottom line, and I think the cops have some answering up to do.

Steve, it`s very rare that I take police or prosecutors to task because I believe they are much maligned, but in this case with the little children saying, mommy`s in the car trunk? That`s what I did on my vacation? That`s all you need. Combined with the circumstantial evidence to take this case to trial. They`re never going to get a body.

STEVE MOORE, FORMER FBI AGENT, VIOLENT CRIME INVESTIGATOR: You`re not. You`re not. And that`s the frustrating thing here. And I`m with you. I find it very hard to criticize officers generally, but there was a serious problem here. There`s no mystery. This wasn`t a who-done-it. We knew who done it. It was just a matter of whether the father was involved also, Josh`s father was involved.

Even if you were afraid of losing your case, you can charge him with kidnapping, as you said, and if you lose kidnapping, you`re not in the double jeopardy problem on murder when you finally get the stuff.

I don`t understand. If it hasn`t happened, I do not understand why the West Valley detectives, and I worked with West Valley. I was stationed in Salt Lake City with the FBI. It`s a good department. I don`t understand why they didn`t take these kids in and speak to them.

GRACE: Well, let`s see what we can find out.

Steve Downing, family law, attorney for Chuck and Judy Cox, joining us exclusively tonight.

Steve, what was the cops` explanation for why they had not made an arrest?

DOWNING: Absolutely we got no explanation. I do know that they sent a psychologist to the state of Washington because they were interviewed at the child advocacy center here on one occasion, and they were traumatized. And I was -- I know someone who was there who witnessed it and they said these kids are not going to open up to a stranger. They`re going to only open up when they feel safe, when they feel secure.

GRACE: Well, I understand that, but Paula Bloom, there`s more than one way to skin a cat. It could be as simple as -- and the Supreme Court has allowed this, for a screen to be between the child and the person asking questions, and they can see their grand mommy and their grand daddy and their Aunt Denise there.

Clearly there would have been a way over time working with a forensic shrink to get the answers out of them suitable to go to trial. And as was pointed out earlier by Kirby, to at least get an arrest warrant.

BLOOM: Right. And that`s the thing that you`re -- that you`re talking about though is -- one of the things you said is it takes a while. From the time this happened to the time that they started giving this information the kids became more verbal. Initially it takes a while for a kid to take information in and then be able to articulate it.

GRACE: Everyone, we are going to break, but we are taking your calls. And I want to remind you, our family album is back. And here are Texas friends, the Goss family, mom Erin, dad Jason, serving military, best gifts in life are their twins Andy and Benny. Born premature, just two pounds, they beat the odds, now three.

Share your photos with us through iReport family album at hlnTV.com/NancyGrace. Click on "Nancy`s Family Album."

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: She didn`t like him. She thought he was a creep and weird and intentionally stayed away from the house. And we verified that.

UNIDENTIFIED REPORTER: Authorities say Josh Powell ignited to kill himself and his two young sons.

UNIDENTIFIED MALE: They found two five gallon cans of gas.

UNIDENTIFIED REPORTER: Finally some insight into Josh Powell`s last few moments before he burned his house down killing himself and killing his two young sons.

UNIDENTIFIED MALE: One of them was with the bodies. The other one we believe was spread throughout the house.

POWELL: This is Josh. And I am calling to say goodbye.

UNIDENTIFIED REPORTER: Powell left this message for his brother Michael, his cousins, and other family members just 20 minutes before setting his house on fire Sunday.

UNIDENTIFIED MALE: Five gallons of gas spread throughout the house. One of them appears to have been lit off right where the bodies were.

POWELL: This is Josh. And I am calling to say goodbye. I am not able to live without my sons. And I am not able to go on anymore. I am sorry to everyone I hurt. Goodbye.

(END VIDEO CLIP)

GRACE: That was Josh Powell`s father singing love songs to Susan Cox Powell.

OK. Denise Cox, let me just clear it up right now once and for all. He was the creep, not her. In fact, all these creepy videos were found on his computer, according to Cox, of Susan and of neighbors, like through their windows getting undressed and taking baths, child pornography. In fact, when she would come to visit you guys she wouldn`t even stay with Josh Powell near his father. She would stay somewhere else in order to be away from him. Is that correct?

COX: Absolutely. The only one -- there`s one time where Susan had to go get something from the house, and she made my mother come with her. And my mom didn`t want to go, but she went with her. And she also told my mom, I want to show you where he lives just in case, is her exact word. Just in case I want, mom, you to know where his family lives. She was that scared of his father and what -- he sickened her that much.

GRACE: Why did Josh Powell stand for it?

COX: He`s as sick as his father. After what he has done to my nephews, I think, you know, they`re in a race to see who is more sadistic and disgusting. Makes you want to throw up. Which one -- you know it`s hard to say which one. They both disgust me.

GRACE: Hey, let me ask you this, Denise Cox. This is Susan`s sister. What do the police have to say now about their failure to make an arrest on Josh Powell?

COX: I haven`t -- I haven`t talked to the police. I`ve been frustrated, but I was always -- you know, my parents constantly reassured they were working on the case, but I -- I -- myself, I haven`t dealt with them other than when she first went missing I did a three-hour interview with the detective.

GRACE: You know, to you, Steve Downing, family lawyer for Chuck and Judy Cox, along with Anne Bremner, also one of the Cox lawyers, and Kirby Clements, defense lawyer.

Steve Downing, what are cops saying now as they watch the same video I`m watching of the house going up in an inferno, about their failure to make an arrest?

DOWNING: Nancy, as far as I know they have not said anything about that. The last word we had was there was going to be arrests by November 15th. Then --

GRACE: Of what year?

DOWNING: 2011. And the date came and went, as so many other dates have come and gone. And then we were assured there was going to be an arrest imminently. Then Chuck and Judy were told it would be sometime this summer. There`s no explanation for why there was no arrest.

GRACE: Anne Bremner, any word from the cops now?

BREMNER: Nothing. Silence, Nancy. And we did have those kinds of assurances, you know, for a long time, like Steve just said, including indicating to us that there would be a whole bunch of events that would occur during a given week, including a TRO that we filed, you know, a rally of files that Chuck and Judy had. And search warrants in (INAUDIBLE), which of course you know require probable cause to believe he committed a murder.

That was even before November. And that was supposed to become a week of reining on Josh`s head culminating, we believe, in an arrest. Never happened. Assurances after assurances, and it never happened.

GRACE: You`re seeing the boys` bedroom here, exclusive photos that we have obtained. The two little boys meeting their death. Their father chopping them with a hatchet to the neck, dousing them, apparently, with gasoline, and sending the whole house up in flames rather than let Susan Cox`s family maintain custody of them, even though he had visitation.

All the red flags were there that an arson was going to take place. Buying gasoline, buying gasoline cans. Getting rid of all the boys` clothing, toys, belongings, giving it away. Even arranging to have the utilities cut off. But nobody was watching Josh Powell. Nobody`s eye was on the prize.

This case apparently long forgotten by authorities who had promised and promised and promised an arrest.

And, you know, Anne Bremner, Kirby Clemens, Steve Downing, you know me, I spent my whole legal career as a public servant as part of the system. It is very rare that I come down on the cops, but this is just wrong. This is wrong, Kirby.

CLEMENTS: Oh, it`s absolutely wrong. I mean, I`ve got to tell you, I mean, as a former prosecutor, I can`t even imagine why they wouldn`t have tried to get a warrant, why they wouldn`t have been in there trying to keep him from having any visitation from that child. This is the kind of case that just cries out for going, you know, full tilt to keep that man from those kids and to get that man behind bars.

GRACE: And isn`t it true, Denise Cox, you`re Susan`s sister, that your family begged for him to have no visitation, they were that afraid of what he might do?

COX: Absolutely. He said that he never would harm my sister, and he did. And he also said he`d never harm his sons. Well, that was the next thing that happened that he did on the list. And he was not trustworthy in any sense, and he proved that by changing his story throughout the two years on what happened to her. She either ran off with somebody or she got sick or -- it was constant, constant changing of the stories.

Oh, well, you know, she loved -- you know she was in love with, you know, my dad. Well, if she`s in love with your dad, then why would she run off with somebody? They kept changing their stories and nothing was adding up. And we knew how -- how disturbed he was.

GRACE: Out to the lines, Robin in Colorado. Hi, Robin, what`s your question?

ROBIN, CALLER FROM COLORADO: How did the state allow this man to have any type of visitation with those children? He should have not had any type of visitation at all. The state failed those children.

GRACE: The state did fail.

Jim Kirkwood, what`s the explanation the morning after? I guess everybody is awfully quiet.

JIM KIRKWOOD, NEWS SHOW HOST, KTKK: They`re so quiet, you could hear any noise. Absolutely quiet.

(BEGIN VIDEO CLIP)

POWELL: I would never hurt her. I would never hurt my boys, I would never hurt anyone.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

POWELL: Hello, this is Josh. And I`m calling to say goodbye. I am not able to live without my sons. And I am not able to go on any more. I`m sorry to everyone I`ve hurt. Goodbye.

(END VIDEO CLIP)

GRACE: Josh Powell`s final voicemail obtained by ABC.

We are taking your calls. Heather, West Virginia, what`s your question, dear?

HEATHER, CALLER FROM WEST VIRGINIA: Hi, Nancy. Do you think that they should make a law wherein if one parent goes missing and the other is a suspect they automatically take custody and visitation away in?

GRACE: I absolutely do, Heather, West Virginia. I absolutely do. I think, of course, there needs to be some type of a threshold level of evidence. I don`t want to just take your child away, but when you are named as a formal suspect, you`re darn right.

To Cindy, North Carolina. Hi, Cindy, what`s your question?

CINDY, CALLER FROM NORTH CAROLINA: Hi, Nancy. I just want to say first how much I admire you for everything you do.

GRACE: Thank you.

CINDY: And my biggest question is what can we do to prevent this from happening again? That`s my biggest question.

GRACE: You know, I`ve been thinking about that all through the night. I don`t know that there is an answer, but Anne Bremner, first of all, the suggestion by Heather in West Virginia about not allowing custody when that remaining parent is a suspect? What do you think?

BREMNER: That`s an excellent suggestion. It should be called Braden and Charlie`s Law, and it -- also should be if someone is a murder suspect, like you said, there shouldn`t be custody.

GRACE: The only comfort, if any, if any, is thinking that the boys are with their mother.

Let`s stop and remember, Army Staff Sgt. Robert Miller, 24, of Vienna, Florida, killed in Afghanistan. Special Forces, second tour. Medal of Honor, Bronze Star, Purple Heart. Two Army Commendation medals, from a family of vets. Loves surfing, foreign languages, military history, music. Leaves behind parents Phillip and Maureen, a Gold Star mother, three brothers, four sisters.

Robert Miller, American hero.

Thanks to our guests but especially to you, and good night from Florida and North Carolina friends, Jillian and Michelle.

Aren`t they beautiful?

Happy birthday to Alabama friend Lyn, paramedic and teacher, loves church, friends, traveling, and three children, Brad, Helen, and Hunter. The Martha Stewart of the family.

Happy birthday, Lyn.

Everyone, I`ll see you tomorrow night. And tonight God bless little Charles, Braden, and Susan Cox.

See you tomorrow night, 8:00 sharp Eastern. Until then, good night, friend.

END