What is on the topside where the rail fence is shown? Is water able to pool up there when it rains?
That wall has already been reinforced at least once before but truthfully I doubt the anchors resolved anything from the looks of it. I'm afraid making any cuts in the wall would only weakin it more at this point.
Is the damaged interior wall (shown) backed up to that same area as the retaining wall?
Can we see what that upper area looks like? The area being held by the retaining wall?