Was Olympic swimmers' robbery lie overblown?

American Olympic star Ryan Lochte and three other swimmers lied about a robbery, but at least one security guard pointed a gun at them, Brazilian police said. Will there be legal ramifications?

This is a rush transcript from "On the Record," August 18, 2016. This copy may not be in its final form and may be updated.

GRETA VAN SUSTEREN, FOX NEWS HOST: Brazilian police holding a news conference to say our four American swimmers made up their stories.

(BEGIN VIDEO CLIP)

FERNANDO VELOSO, RIO DE JANEIRO CHIEF OF CIVIL POLICE (Through Translator): There was no robbery in the way that was reported by the athletes. They were not the victim of the criminal facts that they described. The athletes left their -- where they were coming from, they went to the gas station, they went to the bathroom, and on purpose, one or more than one of them, we're still investigating, began to commit acts of vandalism in the bathroom at the gas station, breaking mirrors and other equipment. This led to a certain confusion at the gas station.

Employees of the gas station tried to control this situation. The images also show the athletes going back to the cab and trying to leave the location. When the employees noticed what was happening, the security guard tried to convince the cab driver to wait for the police and not leave the scene.

Apparently, these facts have been confirmed and there is no doubt about them. The athletes did not want to stay. They did not want to await the arrival of the police.

According to the reports, they offered to pay and they did pay 100 Real and a $20 bill to compensate the establishment for the damages.

The versions of one of the athletes, he has confessed, yes, he confessed -- we confess only when a crime is committed, but he was a witness. He gave a testimony, and he corroborated the facts that I'm sharing with you.

(END VIDEO CLIP)

VAN SUSTEREN: TMZ has been on top of this story from the very beginning. Executive Producer of TMZ Harvey Levin joins us.

Harvey, nice to see you.

HARVEY LEVIN, EXECUTIVE PRODUCER, TMZ: Good seeing you, Greta.

VAN SUSTEREN: Harvey, what's the latest? What information do you have?

LEVIN: Well, we know the police are recommending prosecution. There is a report out that they have actually been indicted Jimmy and Ryan Lochte. They have not. There has been a recommendation, but no indictment as of yet.

Now, I can tell you this. From Ryan Lochte -- from his camp and Jimmy's camp as well, what they are saying is their story was essentially true.

What they are saying is that it wasn't a false police report because, A, they were in a cab, B, they were asked to get out of cab. And, C, they insist they were held at gunpoint in order to turn over money.

Now, you don't see guns in the video. But if you look at that video carefully, and this is something that his team has seized upon, there is a three-minute hole where there is an edit and Lochte's camp says the gas station made the edit because they didn't want to show that the security guards there pulled a gun on them.

And you do see the swimmers with their hands up in the air after the edit is over, where they get out of the cab and it appears, I mean, when you put your hands up in the air because somebody is ordering you to, and everybody there is saying it was because they had pulled a gun on them and that they were ordered to give some money over as a result. So their position is it was effectively a robbery.

Ryan Lochte's problem, I think, is that the pretext for this whole thing was a lie. The pretext of they're driving along, security comes up, pretends like they are a police officer and robs them. That is an indictment on Rio and the safety of Rio and the people of Rio.

And, look, Greta, you can make the argument that technically they could argue that everything in the report is true, but the prosecutors can make the different argument and the jury and judge there, they're in Rio. And people in Rio are pissed at these swimmers for trashing the city.

VAN SUSTEREN: All right. Did they pay any money to compensate this gas station for whatever this vandalism was?

LEVIN: They did. And they paid them money and gave them $100 tip to boot. Now Lochte's position is that was essentially robbery because they paid it with a gun pointing at them.

The gas station is saying, look, we wanted money because they broke our stuff and tried to leave, and we were never going to get them again. So we wanted money from them and then essentially negotiated. But they did pay money for sure.

VAN SUSTEREN: Were they drunk? I mean, what's with this vandalism or was it an accident that something broke?

LEVIN: We are told, Greta, they were wasted. We know they were at a party earlier in the night. This was 6:00 in the morning. They were partying all night long. They were wasted.

What we are told is that they needed to pee. And they got out at the gas station. They wanted to get inside the bathroom. And the bathroom was locked. And they started kicking the door. And then when they did damage and people at the gas station said, stop, you're paying for this, they basically said we're out of here. That's when they walked to the cab, and that's when things escalated.

VAN SUSTEREN: All right. Well, how did the police enter into this picture? Because if they go to the cab, they've got the security guard or somebody asking for the money. They say they paid the money to pay for the damage plus the extra 100 bucks.

Where do the police come into this?

LEVIN: Well, because there was -- I think it's a good question. I mean, there seemed to be a standoff, but money did seem to get paid. My sense of this, and I don't think every -- I don't think anybody is totally forthcoming.

My sense of this is that at a point, there was kind of an amicable here, let's leave it alone and everybody go away. And the police weren't that interested because the people got their money and when the police became really interested is after Ryan Lochte came out with this thing and trashed the whole city.

Greta, I should say one thing. Ryan Lochte is in the United States now. This is not an extraditable offense. So he never goes back to Rio. He is not going to have a problem except maybe with the Olympic committee.

Jimmy is still in Rio. This is a crime punishable by up to six months in jail. And he has a problem because he is still there, and my guess is, he is not going to be able to leave under these circumstances.

And, again, the city is pissed off. The police are upset. And it's not the kind of environment, as you know as a lawyer, it's not the kind of environment you want to be in.

VAN SUSTEREN: Now, the three-minute video, the surveillance video that's missing, is Ryan Lochte asking that the police go back, or Jimmy Feigen asking that the police go back and get the complete video so at least we have a full story to the extent we can.

LEVIN: They want the full video, absolutely. Because they believe the video will paint that full picture that Ryan Lochte painted.

But, again, the problem with that video is the pretext of we're driving along and all of the sudden the cops do this -- all of a sudden these guys come up.

I don't know that the pretext is necessarily going to warrant a criminal indictment but, again, legally it may or may not. But I think as a practical matter, that city is out for some revenge.

VAN SUSTEREN: All right. Well, let me put my defense lawyer hat on.

I mean, look, a security guard with a gun looks like a police officer to most people or to a lot of people. So that's the first thing. The second thing is I assume they have a language barrier. That I assume that most of the people there speaking Portuguese and our Americans are speaking English. And they're drunk.

Am I right?

LEVIN: You're right on every single count. The problem is that the statement that this whole thing happened the way Ryan said. Now, here's my feeling.

I think you're right. And the story that Ryan told the media, told NBC, I don't think he told the police that because why would he tell the police that if they are at the gas station. His story would make no sense to tell the police. So I think that lie was not part of what he told the cops. So that's off the table in terms of making a false police report.

So I do think you're right. Factually, you can make the argument that every step of the way, Lochte was essentially telling the truth in terms of what he told the cops.

But, again, they're recommending an indictment, and the people I have spoken to in Ryan's camp say it ain't surprising because he knows how angry the City of Rio is.

VAN SUSTEREN: I guess what I'm trying to sort out is whether this is just some guy who sort of embellishes his story after he sobered up a little bit and he's telling some Billy Bush, whoever it is, NBC, and he's sort of excited, or did he actually make a false police report saying that -- I mean, what's the false when he told the police?

LEVIN: Well, OK, I will, again, break this down. He said to NBC this business that they are driving home, that the people come up. I don't think he told the cops that. That was a lie. That was obviously a lie.

(CROSSTALK)

VAN SUSTEREN: That's a lie to the NBC. OK.

LEVIN: That's off the table. That's off the table. So then what we're left with is Ryan Lochte telling a story about a robbery when the reality is Ryan Lochte and his friends were there breaking property, damaging and destroying property at the gas station and then leaving without paying.

And the cops are saying we just -- or the security is saying we used force not to get money out of him, but to keep them there until the cops came.

Now, did they use force to rob them? Apparently, the cops don't think so. Apparently, the cops think they were just being held and Lochte is making all this stuff up. That, I think, is going to form the basis of this.

VAN SUSTEREN: Is there any -- how much money was actually paid from Lochte and his colleagues to the gas station or to the management? Was it greatly in excess of what the damage was, the vandalism?

LEVIN: Well, they settled for a certain amount. And then Ryan threw in $100 tip for their trouble. So they seemed to agree on what the amount was. And then Ryan threw another 100 in. That, to me, sounds like not somebody who gets robbed. You don't generally give a robber a tip, at least in my world.

And, you know, that's the way it was kind of put. So I think that's the weakness here was Ryan Lochte and Jimmy, were they robbed of this money or did they settle on the money and then make up the robbery claim later?

VAN SUSTEREN: Or did the guy say give me an extra $100 or you will be sorry. And then, of course, but anyway -- but that's not what Lochte is even saying.

LEVIN: Right.

VAN SUSTEREN: Anyway, Harvey, thank you.

LEVIN: Good seeing you, Greta.