A man from the US state of Vermont has pleaded guilty to five counts of possessing and disposing of stolen vehicles after taking advantage of a loophole that saw him take possession of new Teslas.

    Market Watch reports Michael Gonzalez exploited Tesla’s online ordering system to take delivery of one Model 3 and four Model Xs without paying more than a deposit amount.

    He has agreed to pay Tesla US$493,000 (A$775,452) in restitution and forfeit US$231,900 (A$364,120) in profits to the US government, and has been sentenced to a term of 48 months’ imprisonment to be followed by a three-year term of supervised release

    It’s reported Mr Gonzalez took possession of vehicles totalling US$560,000 (A$880,838) in value over 2018-2019 that were registered in either his name or his girlfriend’s or ex-girlfriend’s names.

    He used Tesla’s online ordering system to leave a minimum deposit first on a Model 3 reportedly worth US$58,000 (A$91,223).

    At the time of delivery, Tesla requested bank account information for the remaining balance which court documents show Mr Gonzalez provided, however these details were for bank accounts with no money or not enough to cover the final amount.

    Tesla reportedly realised this error days after delivery and after it had already issued Mr Gonzalez with a certificate of ownership which allowed him to sell, register and rightfully own the vehicle.

    Less than three months after purchase, Mr Gonzalez sold the Model 3 to a used car dealership for $US42,000 (A$66,058).

    According to prosecutors, Mr Gonzalez repeated the scheme another four times this time to obtain Model Xs each worth around US$150,000 (A$235,923) a pop, using his girlfriend and ex-girlfriend’s names on the paperwork for each.

    Mr Gonzalez then went on to sell two of the four Model Xs online on Craigslist and eBay for US$108,000 (A$169,637) and US$97,000 (A$152,360) respectively.

    Tesla reportedly failed to provide Mr Gonzalez with a certificate of ownership for one of the Model Xs which meant the vehicle couldn’t be registered and therefore couldn’t be on-sold.

    This led Mr Gonzalez to reportedly drive the vehicle onto a frozen lake between New York and Vermont and set the vehicle on fire with the intent of filing a successful insurance claim.

    He filed an insurance claim but given the “unusual circumstances of the incident” Market Watch reports the insurance company asked Mr Gonzalez to come in for an examination under oath and requested the vehicle’s title to be produced.

    It’s reported that Mr Gonzalez failed to make an appearance which in turn eventually led to his arrest.

    While detained on a separate charge related to firearms, Mr Gonzalez reportedly revealed to his girlfriend where the final Model X was hidden and his intent to sell the car when he was released from custody.

    Police were able to intercept Mr Gonzalez once he was released from custody on his way to deliver the final vehicle.

    Jade Credentino

    Jade Credentino is an automotive journalist currently based in Melbourne, Australia. Jade has had a chance to review a variety of vehicles and particularly enjoys SUVs. She enjoys traveling and going on road trips exploring Australia.

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