Final answer:
One criticism of the Wall Street Reform and Consumer Protection Act of 2010 is the claim of overregulation, which critics argue could stifle innovation and burden financial institutions, especially smaller ones, with excessive bureaucracy and regulatory compliance costs.
Step-by-step explanation:
A criticism of the Wall Street Reform and Consumer Protection Act of 2010, commonly known as Dodd-Frank, is often about overregulation. Critics argue that the act imposes too many new regulations on the financial industry, which can create excessive bureaucracy, stifle innovation, and place significant burdens on smaller banks and financial institutions that may not have the resources to manage the new regulatory requirements. These criticisms contrast sharply with those who believe regulation is necessary to prevent another financial crisis like the one that occurred in 2008-2009, and who advocate for even more stringent control over the financial sector.
The creation of the Consumer Financial Protection Bureau (CFPB) as part of Dodd-Frank has been specifically contentious. While proponents see it as an essential body to protect consumers from abusive financial practices, detractors view it as an example of excessive governmental intrusion into the market that may ultimately harm consumers through reduced access to credit and increased costs associated with compliance.