Good morning. Federal anti-money-laundering rules supersede legislation by states that seek to prevent banks from dropping customers over their politics, the Office of the Comptroller of the Currency said.

• Banking fight. The OCC’s remarks came in a letter earlier this month to Rep. Josh Gottheimer (D., N.J.), who had expressed concern that state banking laws could conflict with federal AML laws and limit a bank’s ability to manage risks associated with illicit finance. Florida, for instance, in May passed legislation limiting a bank’s ability to drop a customer for non-quantitative or political reasons, what officials there have called an effort to combat “woke capital.”
   
• OCC’s response. When state and federal laws are in conflict, “The Supremacy Clause of the U.S. Constitution is clear: state law is preempted,” said Acting Comptroller of the Currency Michael Hsu in the letter. Banks must have the ability to open or close accounts that present undue risk, he said, “without concern that doing so will run afoul of state law.”
  
  Hsu added that the OCC is monitoring developments in state law, and “will vigorously defend preemption” on both national security and financial stability grounds.

Read more: Hsu’s letter follows a response to Rep. Gottheimer from Treasury Undersecretary Brian Nelson, who warned that laws like the one passed in Florida could harm national security.

Biden calls for overturn of presidential immunity: ‘The court made a ruling for one.’

President Biden called Monday for a constitutional amendment overturning the Supreme Court’s recent decision awarding former presidents immunity for crimes they commit while in office—and endorsed proposals for a mandatory ethics code and 18-year term limit for justices.

“In recent years, extreme opinions that the Supreme Court has handed down have undermined long-established civil rights principles and protections,” Biden said, speaking at the Lyndon B. Johnson Presidential Library in Austin, Texas.

U.K. regulator reviews its financial-services rulebook.

The U.K.’s financial regulator said Monday it is conducting a review of its financial-services rulebook, with the goal of streamlining regulations to reduce the burden on business, Risk & Compliance Journal’s David Smagalla reports.

In particular, the Financial Conduct Authority said, it will consider simplifying rules in the U.K.’s commercial insurance sector. The FCA is seeking public comment on whether changing the way customers are categorized could reduce costs and increase competitiveness.

The FCA also said that as of Aug. 1, it would consult with a new independent panel of experts on cost analyses of proposed regulations, targeting those that could cost the sector in question £10 million ($13 million) or more a year.

• The taint of a corporate criminal conviction isn’t what it used to be. A criminal conviction now matters less for big companies, which have proven able to mitigate the negative consequences and survive bad publicity.
   
• Five years ago, Washington sanctioned Huawei, cutting off the Chinese company’s access to advanced U.S. technologies because it feared the telecommunications giant would spy on Americans and their allies. Many in the industry thought it would ring the death knell for one of China’s most vital tech players. Huawei struggled at first—but now it’s come roaring back.
   
• Video and data gathered by the Wall Street Journal from over 200 Tesla Autopilot crashes reveals that longstanding concerns about Tesla’s camera-based technology, which differs from the rest of the industry, are showing up on the roads and putting the public at risk.

On the brink of war, Hezbollah is emboldened in a crippled Lebanon.

For years, Hezbollah built up political and military power in Lebanon over the objections of many of the country’s Sunni Muslims, Christians, Druze and other ethnic groups. Now, after Lebanon’s financial collapse ushered in years of political instability, the U.S.-designated terrorist group is garnering support for its confrontational posture toward Israel—even as the fighting risks an all-out war that every major faction in the fractured country says it desperately wants to avoid.

Jet engines need constant repairs. Their manufacturers are raking in cash.

Few industries do well when their products are forever being returned for early repairs. Jet-engine makers are currently an exception—and this is raising eyebrows.

Shares in RTX Corporation hit a record high last week after the aerospace conglomerate significantly beat second-quarter earnings forecasts. Excluding one-time effects, operating profit in its Pratt & Whitney engine-making division rose 23%. GE Aerospace also reported a surge in demand for spare parts for commercial engines, and its stock closed at a 16-year high last Tuesday. In Europe, jet-engine manufacturers Rolls-Royce and Safran are expected to post robust results when they report this week.

For many in the aviation industry, it is hard to square such prosperity with problem-ridden engines that are causing huge headaches for everyone else.

• Iran is seeking to harm Donald Trump’s presidential campaign in covert online influence operations, fearing a return to power by the Republican nominee would inflame relations with Washington, U.S. intelligence officials said Monday.
   
• France’s top cop said Monday he suspects far-left saboteurs were behind the burning of rail lines last week that paralyzed the country’s high-speed train network as the Summer Olympics began.
   
• Big tech stocks are having a rough month. The Magnificent Seven group of tech titans has shed $1.52 trillion in market value in the past three weeks, the biggest drop over such a stretch on record.
   
• The Port of Los Angeles’s transition to green technology is on the blink.
   
• With the Federal Reserve poised to cut interest rates, the question is what might happen to nonbank mortgage servicers.
   
• Chinese leaders said they would take more aggressive steps to boost consumer spending and head off a worsening set of economic challenges, signaling rising concern about flagging momentum in the world’s second-largest economy.
   
• Germany’s economy contracted in the second quarter of the year, an unexpectedly weak reading that cools hopes of a sustained recovery.

• The U.S. and Latin American nations pressured Venezuelan President Nicolás Maduro to release detailed voting data after the strongman claimed victory in Sunday’s election, which sparked widespread accusations of fraud after polls showed he would suffer a defeat of more than 25 percentage points.
   
• China’s leader, Xi Jinping, says he is striving to make sure Chinese civilization wields global influence far into the future. One little-noticed part of that vision: an effort to expand its reach into the very distant past.
   
• The Israeli military raided one of its own prisons in southern Israel on Monday, detaining nine reservists on allegations they abused a Palestinian prisoner who had been held at the facility.
   
• Elon Musk, a master of the memes, is planting his flag in deepfake territory—and risking backlash at a fraught political moment.

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.

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