Good morning. Goldman Sachs is the latest Wall Street firm to face regulators' ongoing scrutiny of their record-keeping practices, reports Risk & Compliance Journal's Mengqi Sun, with the Commodity Futures Trading Commission levying a $5.5 million fine on the bank for its alleged failures to record and retain mobile device calls made by its traders at the onset of the Covid-19 pandemic.

• Not the first time: The civil fine, announced Tuesday, was the latest settlement against Goldman in relation to record-keeping failures. Goldman last September agreed to pay a total of about $200 million to the Securities and Exchange Commission and CFTC over admissions its traders used banned messaging apps, such as WhatsApp, to discuss business, in violation of record-keeping rules.
   
• Debate about remote work compliance, repeat violations: CFTC Commissioner Kristin Johnson, in a statement Tuesday, said, “The civil monetary penalty imposed today is quite literally less than the profit Goldman can earn by the end of the day today.” Another commissioner, Caroline Pham, disagreed with the enforcement action, saying that the CFTC and its staff failed to fully comprehend the challenges resulting from pandemic-era workplace changes.
   
• Era of increased scrutiny: Record-keeping violations have become a focal point in recent years for Wall Street regulators. Earlier this month, several financial firms, including Wells Fargo and BNP Paribas, agreed to pay about $555 million in total to the SEC and CFTC, admitting their employees used banned messaging apps that broke record-keeping rules.

3M just agreed to a $6 billion sttlement. More lawsuits await.

3M reached a $6 billion settlement this week to end the largest single mass tort in U.S. history and agreed in June to pay up to $12.5 billion to resolve litigation on so-called forever chemicals. But its legal troubles are far from over.

More on deck. Thousands of people are suing the Minnesota-based manufacturer, alleging that 3M products containing the chemicals known as PFAS made them sick. States have filed lawsuits, too, claiming 3M and other companies contaminated their soil and waterways.

Grayscale’s court win over SEC lifts hopes for bitcoin ETF approval.

A federal appeals court ruled Tuesday that the Securities and Exchange Commission must reconsider crypto asset manager Grayscale Investments’ application to launch the first bitcoin exchange-traded fund, the latest setback for SEC Chair Gary Gensler’s efforts to regulate the upstart industry.

Disappointed regulators. The decision by the U.S. Court of Appeals for the D.C. Circuit marks the latest legal setback to Gensler’s approach to regulating crypto markets. The agency had denied Grayscale’s application to convert its bitcoin trust, known as GBTC, into an ETF on the basis that spot markets for bitcoin are unregulated and subject to market manipulation. An SEC spokeswoman said the agency is “reviewing the court’s decision to determine next steps.”

• Archipelago Trading Services has agreed to pay $1.5 million to settle charges that it failed to file hundreds of suspicious activity reports over eight years related to trade in over-the-counter securities.
   
• The Securities and Exchange Commission settled cease-and-desist proceedings against Citigroup’s broker-dealer unit regarding its underwriting business.
   
• Meta Platforms said it has taken down the largest known online covert influence operation in the world, a cross-platform campaign that was aimed at advancing China’s interests and discrediting its adversaries including the U.S.
   
• Germany said it arrested a dual German-Russian citizen accused of exporting sensitive components to Russia, in a case demonstrating how Moscow has continued to source Western parts for its military despite facing some of the toughest sanctions in recent history.
   
• Baby-formula manufacturers would be required to notify regulators about contamination in their products in a wider range of circumstances, under bipartisan legislation expected to be introduced Tuesday.
   
• During the 2016 presidential campaign, Jeffrey Epstein began setting up meetings with people close to Donald Trump. He introduced some of them to another of his associates, a top Russian diplomat.
   
• Under Armour founder Kevin Plank gave television anchor Stephanie Ruhle a private phone with a special email address to communicate with him, sent her confidential financial information about the sportswear maker and enlisted her help to refute concerns about slumping sales, according to newly released court documents.

Why hurricanes are becoming more intense.

Hurricane Idalia is battering the northern Gulf Coast of Florida with high winds and a powerful storm surge predicted to reach up to 12 feet in some areas. It is expected to make landfall Wednesday, according to the National Hurricane Center. A total of 22 Florida counties have issued evacuation orders. See our live coverage. 

Warmer water driving bigger storms. It is shaping up as the first Atlantic hurricane to hit the U.S. this season, a year when an above-average number of storms is expected because of extremely warm water in the North Atlantic. The National Oceanic and Atmospheric Administration has predicted 14 to 21 named storms with winds of 39 mph or greater, including six to 11 hurricanes with winds of 74 mph or higher.

Polluted air shortens human lifespans more than tobacco, study fnds.

Cigarette smoking and other uses of tobacco shave an average of 2.2 years off lifespans globally. But merely breathing—if the air is polluted—is more damaging to human health.

Drop in life expectancy. That is the conclusion of a report published Tuesday by the University of Chicago’s Energy Policy Institute, which identified air pollution as the world’s top threat to public health, responsible for reducing average life expectancy by 2.3 years worldwide.

• The nation’s employers reported fewer open jobs last month, adding to signs the solid labor market is gradually cooling as the economy slows under the weight of high interest rates.
   
• The Biden administration and its European allies are laying plans for long-term military assistance to Ukraine to ensure Russia won’t be able to win on the battlefield and persuade the Kremlin that Western support for Kyiv won’t waver.
   
• Two decades ago, Germany revived its moribund economy and became a manufacturing powerhouse of an era of globalization. Times changed. Germany didn’t keep up. Now Europe’s biggest economy has to reinvent itself again.

International operation disrupts ‘botnet’ army behind damaging cyberattacks.

An international law-enforcement operation has dismantled a network of hundreds of thousands of computers that criminals used to launch cyberattacks against critical industries worldwide, U.S. authorities said Tuesday.

Botnet attack. Investigators in the U.S., U.K., France, Germany, the Netherlands, Romania and Latvia took aim at a notorious strain of malware known as Qakbot that had infected more than 700,000 computers, took control of them and enabled them to be leased out to criminal gangs to facilitate more cyberattacks. Justice Department officials said the so-called botnet was used in ransomware attacks, financial and elder fraud, data theft, and more, and caused hundreds of millions of dollars in damage.

• The U.S. government named 10 drugs that will be subject to the first ever price negotiations by Medicare, taking aim at some of the most widely used and costliest medicines in America.
   
• Saudi Arabia is offering to resume financial support to the Palestinian Authority, said Saudi officials and former Palestinian officials familiar with the discussions, a sign that the kingdom is making a serious effort to overcome obstacles to establishing diplomatic relations with Israel.
   
• This year’s peak shipping season is arriving with a whimper as merchants and consumer-goods suppliers continue to burn off excess inventories built up during the Covid-19 pandemic and logistics companies cope with tepid volume and freight rates far below year-ago levels.
   
• India has been trying to lure some of the world’s biggest companies to set up new factories after repeated lockdowns under Beijing’s zero-Covid policy and rising geopolitical tensions with the West prompted many firms to look for alternatives to China, in a strategy referred to as “China plus one.”
   
• The latest from our AI series: Generative artificial intelligence has captivated marketers’ attention by promising to help them conduct research and produce campaigns more efficiently. But it is also poised to further complicate some of their most thankless tasks, such as ensuring that their ads run only near content they want and that their digital marketing materials stay on-brand.

Follow us on X at @WSJRisk. Follow Risk & Compliance editor David Smagalla @DSmagalla_DJ and reporters Mengqi Sun @_MengqiSun, Dylan Tokar @dgtokar and Richard Vanderford @VanderfordRich.

You can reach us by replying to any newsletter, or email David at david.smagalla@wsj.com.