James Moore: Sheriff Lawsky is back in town to take on his old enemy, Standard Chartered

Outlook Benjamin Lawsky was described as “Wall Street’s toughest cop” by a US political magazine recently. It seems he’s out to prove it. Guess which bank will be the vehicle for that? Yes, Standard Chartered is on the naughty step again.

They say troubles come in threes. StanChart’s seem to be coming in fives or sixes. Earnings are falling at such a rate there have been two profit warnings. Well-regarded executives are walking out (or being shoved). A commodities fraud in China has pushed up impairments over the $1bn (£590m) mark at the half-year stage, and there are growing questions about the future of the chief executive, Peter Sands.

Now Mr Lawsky is back, two years to the day since he labelled the bank a rogue institution whose concealed sanctions-busting had left the US exposed to terrorists and drug kingpins. Ouch.

This time it appears that the aptly named Mr Lawsky is pursuing the bank over a cock-up rather than a conspiracy. A computer system installed in 2007 with the aim of improving the bank’s tracking of suspicious transactions did the opposite by managing to miss a bunch of them.

While the financial penalty will likely be less than the $667m total that StanChart paid last time (just over half of which went to Mr Lawsky’s New York banking regulator) that’s not the worst of it.

StanChart has had monitors breathing down its neck since the sanctions-busting penalty was agreed. They’re now going to stay put for rather longer than it had hoped.

Mr Sands was at pains to point out that despite its troubles, his bank still made more money in the first six months of this year than in the whole of 2006, the industry’s pre-financial crisis peak. But what matters is where it is now, and whether Mr Sands is capable of dragging the company out of its current malaise.

Investors are at the very least entitled to ask whether there are more skeletons in StanChart’s closet.

Mr Sands has been with the bank for a long time. Senior colleagues who may have provided a counterweight to his power have repeatedly fallen by the wayside.

That could make this a dangerous time for Standard Chartered, which might well benefit from a fresh pair of eyes. Longstanding, successful banking executives have a nasty habit of conflating the interests of the businesses they run with their own. Mr Sands says he isn’t going anywhere, and the board has very publicly backed him in the face of rumours of shareholder disquiet. They say he’s the right man for the job. They’d better be right.