Both can be true: over-regulation and bad regulation. And the West (especially the EU) is arguably suffering from both to various degrees.
At some point a regulation is no longer worth the weight in the overhead it imposes. Even if all regulation was effective, at some point the collective burden would be too high.
Sadly, this also means that some bad behaviour is inescapable at the margins. There are always a few people looking for an angle to make a quick buck in a certain way, yet not enough for a regulation to be supported.
The textbook ideal regulation is zero in the same way that a textbook ideal operating system costs no ram, takes no cpu cycles, or consumes and disk space.
Reality is more complicated. And once you incur the cost of reality there's probably some things that you should bundle with it for convenience and consistency.
At some point a regulation is no longer worth the weight in the overhead it imposes. Even if all regulation was effective, at some point the collective burden would be too high.
Sadly, this also means that some bad behaviour is inescapable at the margins. There are always a few people looking for an angle to make a quick buck in a certain way, yet not enough for a regulation to be supported.