error: read /xxx/xxx/xxx: is a directory when using commands

Summary

Unknown issue when trying to use kubectl commands on gitlab-runner. I have used this config fine in the past which led me to believe it is a runner issue

Steps to reproduce

Create a repo. Add a CI file with the staging stage shown below. Let it run and see the error it produces.

.gitlab-ci.yml

staging:
  stage: deploy
  image: registry.gitlab.com/gitlab-examples/kubernetes-deploy
  environment:
    name: production
    url: https://redacted.com
  before_script:
    - kubectl config set-cluster default-cluster --server=$KUBE_URL --certificate-authority=$KUBE_CA_PEM_FILE
    - kubectl config set-credentials default-admin --token=$KUBE_TOKEN
    - kubectl config set-context default-system --cluster=default-cluster --user=default-admin --namespace=default
    - kubectl config use-context default-system
  script:
    - kubectl set image deployment/embed embed=$CI_REGISTRY_IMAGE:$CI_BUILD_REF

Actual behavior

It gives the error of error: read /builds/disweb/embed: is a directory

Expected behavior

Relevant logs and/or screenshots

job log

Running with gitlab-runner 12.2.0 (a987417a)
  on lab FGQi-C1p
Using Docker executor with image registry.gitlab.com/gitlab-examples/kubernetes-deploy ...
Pulling docker image registry.gitlab.com/gitlab-examples/kubernetes-deploy ...
Using docker image sha256:f72f0696c971153613e458f3a6593ae835b554650db2794ee94c63a57cbb7241 for registry.gitlab.com/gitlab-examples/kubernetes-deploy ...
Running on runner-FGQi-C1p-project-4-concurrent-0 via lab...
Fetching changes with git depth set to 50...
Reinitialized existing Git repository in /builds/disweb/embed/.git/
Checking out 59e75282 as master...
Removing build/

Skipping Git submodules setup
Downloading artifacts for canary (526)...
Downloading artifacts from coordinator... ok        id=526 responseStatus=200 OK token=JNK25EET
$ kubectl config set-cluster default-cluster --server=$KUBE_URL --certificate-authority=$KUBE_CA_PEM_FILE
Cluster "default-cluster" set.
$ kubectl config set-credentials default-admin --token=$KUBE_TOKEN
User "default-admin" set.
$ kubectl config set-context default-system --cluster=default-cluster --user=default-admin --namespace=default
Context "default-system" created.
$ kubectl config use-context default-system
Switched to context "default-system".
$ kubectl get nodes
error: read /builds/disweb/embed: is a directory
ERROR: Job failed: exit code 1

Environment description

This is a gitlab CE installation with a custom runner.

config.toml contents

concurrent = 1                           
check_interval = 0                       
                                         
[session_server]                         
  session_timeout = 1800                 
                                         
[[runners]]                              
  name = "lab"                           
  url = "REDACTED"         
  token = "REDACTED"         
  executor = "docker"                    
  [runners.custom_build_dir]             
  [runners.docker]                       
    tls_verify = false                   
    image = "ubuntu:18-git"              
    privileged = true                    
    disable_entrypoint_overwrite = false 
    oom_kill_disable = false             
    disable_cache = false                
    volumes = ["/cache"]                 
    shm_size = 0                         
  [runners.cache]                        
    [runners.cache.s3]                   
    [runners.cache.gcs]                  

Used GitLab Runner version

Runtime platform arch=amd64 os=linux pid=4560 revision=a987417a version=12.2.0