LAUER: Yesterday afternoon on MSNBC, you said that Michael Flynn “enjoyed the full confidence of the president.” Sean Spicer later said the president was evaluating the situation. And then Michael Flynn resigns overnight. Were you out of the loop on this?

CONWAY: No, not at all, both were true. The president is very loyal. He’s a very loyal person and by night’s end Mike Flynn thought was best to resign. He knew he’d become a lightening rod and he made that decision.

LAUER: So, had he not resigned, the president would continue with him as National Security Advisor even though he misled the vice president and the administration about the contents of that call?

CONWAY: Well, that fact is what became unsustainable, actually. I think misleading the vice president really was the key here. And I spoke with the president this morning and he asked me to speak on his behalf and to reiterate that Mike Flynn had resigned and he decided that this situation had become unsustainable for him (Lauer interupts, “but wait a minute) and, of course, the president accepted that resignation.

LAUER: But, wait a minute. You’re saying that was the straw that broke the camel’s back, but the White House knew about that last month when the Justice Department warned the White House that Mr. Flynn, or General Flynn, had not been completely honest in characterizing that conversation with the Russian ambassador. And they even went further to say as a result of that dishonesty, he was at risk for blackmailing by the Russians.

CONWAY: Well, that’s one characterization. But, the fact is that General Flynn continued in that position and was in the Presidential Daily Briefings, was part of the leader calls as recently as yesterday. He was there for the Prime Minister’s visit from Canada yesterday. And, uh, as time wore on, obviously the situation had become unsustainable and (Lauer interrupts)

LAUER: Kellyanee, that makes no sense. Last month the Justice Department warned the White House that General Flynn had misled them. And that as a result, he was vulnerable to blackmail. And, and at that moment, he still had the complete trust of the president?

CONWAY: Matt, I’m telling you what the president has said, which is that he’s accepted General Flynn’s resignation and he wishes him well and that we’re moving on, there are at least three candidates, very strong candidates that will be considered for a permanent position here. Obviously General Keith Kellogg is the acting National Security Advisor starting today and the president will be informed going forward.

LAUER: I want to go back to that phone call with the Russian ambassador back in December. You’re starting to make me think that perhaps General Kelly was not freelancing during that call when he talked about or hinted….I’m sorry, uh General Flynn. That he wasn’t freelancing during that call. That he may have been making that call on behalf of the administration or the incoming administration. Would that be accurate?

CONWAY: No, in the end, remember it was misleading the vice president that made the situation unsustainable.

LAUER: Which the White House knew about last month. And yet yesterday, you went on the air and said that General Flynn had the complete confidence of the president.

CONWAY: And General Flynn decided he should resign last night and the president accepted that resignation. The president has been carrying forward, with his entire team, very effectively frankly, and at this stage he accepted the resignation and he’s moving on.

LAUER: But loyalty is one thing. Keeping a guy in a position of National Security Advisor who has communicated with the Russians and then misled the administration about the contents of that communication is entirely a different thing. Wouldn’t you agree with that?

CONWAY: Well Matt what I would tell you is that the president and I had a conversation where he referred to the the comments made by Charles Krauthammer on a different network last night that it’s not one communication or one incident necessarily. In this case it is the misleading to the vice president and also the inability to remember as General Flynn has started to clarify his remarks and say “I don’t remember. I can’t recall.” I think that was his clarification over the weekend. I can’t recall whether or not the information that was provided to the vice president, that others in the administration have repeated as well, whether or not that was in fact the whole truth.

LAUER: Was General Flynn the right pick in the beginning?

CONWAY: The president chose him and that’s the, he was very loyal and he worked very hard 30+ year career in the military. I’ve talked to Flynn on a number of occasions about that career and…

LAUER: But isn’t it kind of surprising with that 30 year plus career in the military. A guy who in December was about to be named the National Security Advisor would not understand or realize that phone calls with the Russian ambassador are routinely wiretapped by U.S. intelligence officials and that anything he said on that call might come back to haunt him?

CONWAY: Well, you are presuming what General Flynn did or did not know. But the key here, I’m gonna repeat it, the key here the misleading of the vice president and others. Uh, the incomplete information or the inability to completely recall what did or did not happen as reflected his debriefing of particular phone calls. That really was what happened here.

LAUER: All right. Kellyanne Conway, we’ll leave it at that.