Court rejects drug dealers’ claim that drugs, weapons and $750K in cash found in residence wasn’t theirs

Adrian Myles Puentes-Reed and Khalid Yousuf were arrested by Thunder Bay Police after they were found sleeping in a residence full of drugs, weapons and $750,000 in cash. (File)

An appeals court has rejected claims by two drug dealers that they didn’t own a large amount of drugs, weapons and $750,000 in cash found in a Thunder Bay, Ont., home where the two were sleeping.

The appeal detailed how drug dealers are drawn to northern Ontario because of the massive profits to be made.

Previous cases have shown dealers often use two locations when selling drugs. One site, the ‘trap house,’ is where the drugs are actually sold, often the home of an addict who is provided drugs in exchange for the use of their residence.

Dealers have minimal money and drugs on hand at the trap house. That way, they minimize their risk in case they are robbed or if they are busted by police.

As their supply runs low, they return to the ‘safe house’ to resupply and to drop off the cash they received selling drugs, before returning to the trap house.

“Expert evidence was led at trial suggesting that Thunder Bay had become somewhat of a hub for drug trafficking, a place where various drugs were sold at higher-than-average prices,” the appeals court decision said.

“The expert testified that drug dealers from outside of Thunder Bay were known to have taken over residential premises in Thunder Bay and were using them in two ways.”

While trap houses are relatively accessible, the court said access to safe houses is “limited to other mid-level and higher-level drug traffickers that were doing business at the homes.”

The two dealers in this case -- Adrian Myles Puentes-Reed and Khalid Yousuf – were convicted on Feb. 24, 2023, of eight counts of drug trafficking, as well as weapons offences and possession of the proceeds of crime.

Puentes-Reed received a nine-year sentence and Yousuf eight years. Both appealed their convictions.

Police discovered the safe house thanks to the landlord, who entered to make a repair and found firearms in plain view.

“When the police entered the residence, they found it bursting with drugs and drug paraphernalia, cash and firearms,” the court said.

Officers saw crack and cannabis on a kitchen counter, alongside a Glock firearm and $90,000 in cash. Another $27,000 in cash was in a bag in the kitchen.

Another Glock was on a living room table, alongside a Brevete handgun and a .380 calibre Browning handgun. They found 800 grams of cocaine in a bag on a couch, $400,000 in cash in a duffle bag in a closet and more than $75,000 in cash stored in shoe boxes.

Handguns on the living room table

“There were also scales, hydromorphone pills and over 800 oxycodone pills discovered in the residence, along with a money counter and envelopes of cash,” the court said.

When all the cash was counted, it totalled about three-quarters of a million dollars.

After entering the house, police eventually moved up to the third floor, where they found the two men asleep “in a drug-induced state.”

“The critical issue at this judge-alone trial was whether the appellants were in possession of the proceeds of crime, drugs and firearms,” the decision said.

“The trial judge concluded that they were and entered convictions.”

In his appeal, Puentes-Reed insisted he was in Thunder Bay not to sell drugs, but with the goal of building and operating a hip-hop studio.

“He tried to distance himself from the safe house, claiming that it was not his intention to build his hip-hop business from there,” the court said.

“Indeed, he claimed that he was not even staying in the home on this visit to Thunder Bay.”

Was just a ‘coincidence’

He claimed that a third person had brought him and Yousef to the house “in a drug-induced state,” and he had no recollection of how he got there.

The fact that he was sleeping in a bedroom with more than $450,000 in the closet was pure “coincidence.”

The trial judge rejected that testimony as “entirely incapable of belief,” and pointed to the fact that his passport was found in a drawer, along with Canada Revenue Agency documents in his name. Plus, a jacket hanging in the closet had a credit card in his name in the pocket.

The appeals court ruled the trial judge had “ample evidence” upon which to base a guilty verdict.

The case against Yousef, however, was less obvious. In his appeal, he claimed that there was evidence only that he “was found in a residence containing a significant amount of contraband” and nothing else.

However, the trial judge reasoned that “only individuals involved in the drug operation would be left unsupervised in the safe house.”

With such a large quantity of drugs, cash and weapons in plain view, it is something that Yousef would have had to notice as he passed through the house on his way to the third floor to sleep, “even someone in an inebriated state.”

“In my view, Mr. Yousuf’s proximity to these items, having to pass them on the way up the stairs, contributes to my finding that he had those items together with Mr. Puentes-Reed in their constructive possession or custody,” the trial judge wrote.

“Further, the fact that he was one of two people found in the residence leads to the only logical conclusion he was in occupation of the residence for the use or benefit of himself and of Mr. Puentes-Reed.”

The residence had only one purpose: to be a safe house and it was “bursting at the seams with contraband,” the trial judge said.

Only two people were inside when police arrived. The appeals court concluded that the trial judge had enough evidence to logically conclude that Yousef was “in constructive possession” of the contraband and was guilty of trafficking and the other offences.

Read the full decision here.