What type of new entities were created under the Dodd-Frank Act?

The Dodd-Frank Act, passed in response to the 2008 financial crisis, was designed to promote financial stability and prevent future crises by implementing a range of reforms across the financial sector. One of the key aspects of the Dodd-Frank Act was the creation of new federal administrative agencies that were intended to enhance oversight and regulation of financial markets.

Among the institutions established were the Consumer Financial Protection Bureau (CFPB), which was created to protect consumers in the financial sector, and the Financial Stability Oversight Council (FSOC), tasked with identifying and mitigating systemic risks in the financial system. These agencies are responsible for enforcing consumer protection laws and ensuring that financial institutions are operating in a manner that is safe and sound for the broader economy.

The Dodd-Frank Act’s focus on establishing federal administrative agencies underscores a shift towards greater federal oversight and regulation, aimed at enhancing stability and transparency in the financial markets, which is a direct response to the inadequacies that contributed to the financial crisis.