A Vermont man duped Tesla into giving him five cars for free — now he’s headed to prison

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His brazenness was electric.

A Vermont man has been sentenced to four years in prison for duping Tesla Inc. into giving him five high-end models for free and then pocketing hundreds of thousands of dollars when he sold them for knock-down prices.

Federal prosecutors say Michael Gonzalez, 34, of Shelburne, Vt., had figured out a loophole in Tesla’s payment system which allowed him to take possession of $560,000 worth of high-end Tesla automobiles that he didn’t pay for. He later sold three of the five vehicles to unwitting buyers for $231,900.  

In one instance, prosecutors say Gonzalez took delivery of a $153,000 Tesla Model X, but was unsuccessful in securing the vehicle’s title, so he drove the car onto a frozen section of Lake Champlain and set it on fire, for which he filed an insurance claim.  

Gonzalez pleaded guilty in April to five counts of possessing and disposing of stolen vehicles, just days before a trial was set to begin in the case. As part of his plea deal, Gonzalez agreed to pay back Tesla $493,000 and to forfeit the $231,900 he made in profit to the government.

“Michael took full responsibility for his actions,” Gonzalez’s attorney, Chandler Matson, said. “He showed true remorse and commitment to restitution and respect for the justice system.”

A low-wattage scam

Investigators say Gonzalez’s scheme was simple: He simply entered bank details into Tesla’s online payment portal that were attached to accounts that had little or no money in them. 

Before waiting for the transaction to be completed, prosecutors say Tesla would simply deliver the car and its title to Gonzalez in Vermont. Days later, Tesla would receive notice that the accounts Gonzalez had provided had insufficient funds, but by then Gonzalez had the car. 

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Gonzalez was accused of first hitting upon his scheme in  September 2018, when he placed an order on Tesla’s website for a $58,000 Model 3. Gonzalez gave a deposit of $2,500 with his order, but when the car was ready for delivery the next month, he provided Tesla with bank information for accounts that didn’t have enough money to pay the balance.

Tesla, nonetheless, delivered the vehicle to Gonzalez in Vermont and gave him a certificate of ownership, which allowed him to receive the car’s title and register it with the Vermont department of motor vehicles. A week later, Tesla received notice that Gonzalez’s account had insufficient funds to complete the transaction.

By the end of December, prosecutors say, Gonzalez had sold the vehicle to a used car dealer for $42,000.

Over the following year, prosecutors say Gonzalez repeated the scheme four more times, but for more expensive Model Xs each worth around $150,000. In some cases, he entered the name of a girlfriend or ex-girlfriend as the buyer to avoid detection, according to court papers. He was able to sell two of the cars on Craigslist and eBay for $108,000 and $97,000.

In one transaction, Tesla did not give Gonzalez a certificate of ownership, which made it impossible for him to title or re-sell the car. So prosecutors say he instead drove the vehicle onto a frozen part of Lake Champlain, purportedly to go night ice-fishing, but instead he set the vehicle on fire.

He later filed an insurance claim, but given the unusual circumstances of the incident, the insurance company requested that Gonzalez come for an in-person “examination under oath,” during which he was required to produce the vehicle’s title. Gonzalez failed to appear for the interview, according to court documents.

In his last attempt to steal a Model X, prosecutors say that Gonzalez sped away from repo men who had been sent to take back the car, nearly striking one of them. He then stashed the car in a storage unit in Vermont.

Soon after, Gonzalez was arrested on a separate federal charge for allegedly lying on a federal firearms application form, in which he stated he was not facing any criminal charges at the time even though he had an open case against him in state court for aggravated assault with a weapon.

While in detention, prosecutors say Gonzalez was recorded telling his girlfriend over the phone about where the car was hidden and that he intended to sell it when he got out. Upon his release, he moved to sell the car to a buyer in New Hampshire, but police managed to intercept it as it was being delivered.

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