A new report from the New York state attorney general’s office puts cryptocurrency exchanges under fire for industry-wide corruption. Three exchanges have been called out for behavior related to conflicts of interest that raise red flags, in addition to alleged bot-based price manipulation.

An in-depth overview of 13 exchanges released today calls out the different ways major exchanges have exploited their customers’ trust. The asset trading platforms are not compliant with security standards and protocols and all users are incurring “significant risk” when using these services according to the report.

The report appears to have the crypto customers’ best interests in mind stating:

“By highlighting these weaknesses, as well as other considerations important to consumers, the OAG hopes to educate customers, and to encourage the virtual asset marketplace to adopt policies that ensure the integrity of transactions”

After sending out voluntary questionaries to the 13 exchanges reviewed in the report, just nine answered. The big name exchanges that did not respond to the questionnaire might surprise you, Kraken, Binance Limited, Huobi Global Limited and Gate.io. all blew off the AG’s request completely. Meanwhile, household exchanges like Coinbase, Bittrex, and Bitifinex decided it was wiser to comply.

After Binance, Gate.io, and Kraken denied the request, Barbara Underwood’s office sent out a tweet naming names and accusing the cryto exchanges of “possibly operating unlawfully in New York.”

The report sought to investigate the exchanges end-to-end, looking into price manipulation and insider trading specifically. What raised the most concern is the prevalent use of automated and algorithmic trading. The report exposes companies’ strategies to buy and sell on their own exchanges for the purpose of increasing liquidity.

Coinbase openly admitted to this practice estimating that nearly 20 percent of its trade volume was the Coinbase team in action. This is problematic as it puts customers at higher risk for not being able to liquidate their funds in the face of market volatility. Availability of liquidity is determined completely by the exchange without any protective protocol in place. If Coinbase stops using its own exchange those users looking to sell will not be able to find buyers and may have to endure the financial loss.

Exchanges like Kraken seem to think that mass market manipulation doesn’t matter to crypto investors and basically admitted that scams and fraud are par for the course.

The report is dismal news in already dark times for crypto investors. It is continually suspected that the current state of the market is related to a backdoor orchestrated whale sell-off, further negating any sense of security. The bottom line is this: there are no widely implemented audits or security measures regulating cryptocurrency exchanges for better or for worse.