With US hostility to the City of London mounting after a series of banking scandals, a presidential campaign that is in full swing and an ambitious financial regulator in New York keen to make his name, there is clearly the political will to give Standard Chartered a good kicking.
And there have even been suggestions that the US' apparently increasing vigilance is fuelled by financial competition.
"You can't help wondering if all this beating up of British banks and bankers is starting to shade into protectionism; it might actually be at least partly motivated by jealousy of London's financial sector - a simple desire to knock a rival centre," London mayor Boris Johnson wrote in the Spectator.
Whatever the background, Sands is adamant that, while there is a grain of truth in the New York State Department of Finance (DFS) allegations, they are wildly overblown, largely inaccurate and have been released in a damaging and irresponsible manner.
Asked last week whether he thought - as many do - that Standard Chartered was being used as a political football by US regulators, Sands said: "It's not my place to comment on that."
Standard Chartered, which focuses on emerging markets in Africa and Asia, has performed well during the banking crisis.
Few argue that the US has every right to impose tough penalties on those companies breaching sanctions against Iran - especially among banks, which have the potential to bust them on an industrial scale through thousands of hidden transactions that help to oil the wheels of terrorism and Iran's much-feared nuclear programme.
Lloyds TSB agreed a US$350 million settlement in September 2009 after admitting breaking international sanctions by secretly channelling Iranian and Sudanese money into the US banking system by deliberately falsifying wire transfers to disguise their origins in a process known as "wire-stripping".
Eleven months later, Barclays reached a US$298 million settlement over dealings with countries including Iran, while last month it emerged HSBC had flouted US sanctions on Iran. Meanwhile, in June ING Bank agreed to pay US$619 million in the biggest settlement of the lot.
The US first introduced sanctions against Iran in 1979 after the Islamic Revolution overthrew the government.
But the sanctions have been toughening in recent months, as politicians scramble to halt Iran's perceived efforts to pursue a nuclear bomb-making capability.
"The US has had very tough anti-laundering rules for a long time. They are designed to combat terrorism and nuclear development and are not to be treated as trivial housekeeping rules," said John Coffee, a law professor at Columbia University in New York.
"However, the Standard Chartered case looks different. The normal trait in these situations is for financial regulators to act in concert - but Ben Lawsky has stepped in front of his peers, possibly to get a greater share of the credit," Coffee adds.
Benjamin Lawsky is the ambitious New York regulator. Last week he broke ranks with the five other regulators who have been working on this case for the past couple of years to publish, without warning, a series of damning indictments on Standard Chartered which the bank was not prepared for - but which it quickly denied.
Lawsky's move is said to have created a good deal of tension among the other regulators, who view it as a bid to further his career at the expense of the investigation, which has yet to be completed.
Although Sands concedes some transactions between 2001 and 2007 busted US sanctions on Iran, their value was less than US$14 million, representing a minuscule fraction of the US$250 billion figure alleged by the DFS. Furthermore, the infringements amounted to honest mistakes - "small clerical errors" - rather than a conscious attempt to flout the sanctions.
At a hastily convened press conference Sands could barely contain his contempt for the New York regulator.
"There are lots of matters in that order which we don't recognise or we don't understand or are factually inaccurate," said Sands after returning early from his summer holiday, adding that some of the DFS findings "contradicts information we have given them".
Whatever the truth of the matter, Lawsky looks to have acted in haste.
Assuming that what Sands says is correct, the challenge Standard Chartered executives face tomorrow will be to demolish the case against the bank in a firm but cool and polite manner. Even though, with politicians baying for blood, it will be tempting to lash out.
Beyond that, given the backdrop of animosity towards British banks and the temptation for politicians and regulators to cash in, at least some shareholders and experts think that, whatever the truth, the bank should bite the bullet and go for a settlement.
"If Standard Chartered goes to trial, that will be suicidal," said Coffee. And if what Sands says isn't correct, a trial would be far more damaging still.
Lawsky, 42, has been touted as a future New York governor and, if his behaviour over Standard Chartered is anything to go by, he takes this tutelage seriously. By outing the Standard Chartered case before the other regulators were ready, he has made the group effort seem like his own.
A graduate of Columbia Law School, Lawsky worked as an assistant attorney in New York for five years and, more recently, as New York governor Andrew Cuomo's chief of staff.
His role model could be Eliot Spitzer, who made his name taking Wall Street's finest to task as New York's attorney-general between 1999 and 2006, going on to become state governor.
But here, Lawsky might seek to divert his course - Spitzer resigned as governor in 2008 after admitting to spending thousands of dollars on prostitutes.
LEARNING THE LINGO
WIRE STRIPPING
The practice of removing any coding from wire transfers, such as customer names, bank names and addresses, that would identify their origin so that they can pass undetected through filters at US institutions.
U-TURNS
Before they were outlawed in 2008, u-turns allowed US-based banks to process some dollar-denominated transactions for Iranian banks or individuals provided that a bank that was neither American nor Iranian acted as an intermediary on both sides of the deal.
NEW YORK STATE DEPARTMENT OF FINANCIAL SERVICES
The beefed-up New York financial services regulator, led by Benjamin Lawsky, was created last October through the merger of the state's banking and insurance supervisors. It regulates around 4400 entities with assets of about US$6.2 trillion.
OFFICE OF FOREIGN ASSETS CONTROL
The branch of the US Treasury that is responsible for administering and enforcing economic and trade sanctions.
- Independent
