Detroit hustler Terrance “Dougie” Coles was looking for easy money.

So he decided to sell guns to Toronto drug dealers.

Coles calculated it this way: buy a pistol in Michigan for a couple hundred dollars and feed it to Toronto, where supply cannot pace demand, for 10 times as much.

There was a complication: with prior convictions for gun and drug crimes, Coles was unlikely to get across the border.

Though only 23 at the time, Coles — a community college dropout whose mother was dead and father a convict — was shrewd, with a particular interest in psychology.

He saw a way to quarterback his business plan while floating above the grimy details and the law.

He used four young women — including two cash-strapped cousins, one of them eight months pregnant — to mule the guns across the border at the Detroit-Windsor Tunnel crossing.

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“I wanted to be as discreet as possible. I figured it will be less suspicious if someone who didn’t have a criminal background (did) the transporting,” said Coles in a jailhouse interview with the Star.

Coles used his grandmother Bertha’s cellphone to schedule the deals and negotiate payments.

The deals were swift and money fast.

Then Coles got greedy and reckless.

Somebody was listening in on his calls.

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A Toronto Star investigation has found pricing along the U.S.-Toronto handgun pipeline works like this:

With a driver’s licence, or sometimes without any ID at all, a supplier buys a cheap $150 handgun on the Internet, as Star reporters recently did in Atlanta, or at a store or gun show in Michigan or Georgia, typically anywhere along the Interstate 75 corridor.

A smuggler transports the gun across the border. In Windsor, that $150 handgun will sell for $800 to $1,000.

Another courier (or the initial smuggler who crossed the border) takes the pistol farther, along Highway 401 to Toronto, where the money doubles, the gun selling for $2,000 or more.

Alternatively, smugglers barter guns for cocaine, ecstasy and other drugs more cheaply available in Toronto than in the U.S.

The guns — often stored in a shoebox tucked away in the buyer’s closet — are then ready for use in Toronto.

Though the pipeline, in some cases, does not end there.

The Star has found cases where handguns are then rented to the street, in one instance for as much as $600 per night.

The reasons for the hefty markups are not complicated:

Comparatively strict Canadian laws make gun possession and ownership in Toronto difficult. Drug dealers and other criminals desperate for firepower are willing to pay a lot for Hi-Point and other cheap brands of semi-automatics.

“The demand in Canada and the profit for U.S. suppliers are really what is fuelling the gun trade,” Special Agent Mark Jackson of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives told the Star.

The Star’s ongoing investigation, which began last week revealing how easy it is to buy a gun in the U.S., will take you along the pipeline, from broker to mule to end user, from the states with lax guns laws to the border where most guns get across to Toronto. Today’s story is about a Detroit hustler’s growing gun supply business and the lawman on his tail.

To Agent Jackson, who ran the surveillance team, the gun supplier was, at first, just a disembodied, breezy voice on the phone.

Saying he has “Four nice hand boys . . . Two 40s . . . Two 9s . . . a mini chopper” and more.

Jackson wanted it that way. He needed to patiently work the outer edges of the investigation. Rush it, and the supplier might go to ground.

It was months earlier when the agent heard from a confidential source that a Detroit-area gun supplier named “Dougie” was moving guns to Toronto.

Undercover officers posing as Toronto drug dealers put word out in the Detroit-Windsor area that they wanted guns and circulated their cellphone number. Weeks later, “Dougie” called.

Jackson monitored the calls and traced the supplier’s cell to an address — Coles’ grandmother’s house on Santa Rosa Drive in Detroit.

“I had a hunch it was Terrance Coles,” Jackson told the Star. “We needed to set up a face-to-face so we could confirm that this voice we’re hearing on the phone was actually Coles.”

Meantime, Jackson, his team of fellow agents, and Windsor police officers followed the mules.

Jackson, alongside Windsor cop Jason Bellaire, started planning what would become the biggest and most complicated international gun smuggling case the veteran agent had ever worked.

By the time it was all over, in a strip-mall parking lot, after Jackson steered his unmarked sedan into the front end of a speeding Dodge Charger carrying Coles and his accomplice, Jackson had worked the case eight straight months.

“It took a very small bite out of the gun trade from Michigan to Windsor and beyond,” said Jackson, who has worked hundreds of gun-trafficking investigations since joining the ATF in 2000. “I think guns are getting across everywhere.”

On Feb. 2, 2008, Coles told his new clients that he had four guns and would also try to find a MAC-10 or MAC-11, a semi-automatic machine pistol easily converted to fully automatic mode — meaning, one trigger pull can quickly fire all the bullets in the high-capacity magazine.

Coles was also eager to discuss other business opportunities.

“Right off the bat, Coles asked for ecstasy. He starts by calling them Skittles and thingie-things,” Jackson said. “He said, ‘Look, I can get you guns, can you get me ecstasy?’ He knew well enough that a lot of our ecstasy in the States comes from Canada. So I think a light bulb goes on in his head.”

Coles’ push to diversify his operation gave agents an idea for how to ultimately catch their man.

On Feb. 5, Coles sent one of his mules, Denisa Manga, to exchange four 9-mm handguns for $4,400 plus a $500 smuggler’s fee.

An A student studying forensic science at Wayne State University, Manga lived with her parents in Windsor and commuted to and from the Detroit school. A pat explanation for border guards curious about her frequent crossings.

In early 2008, Manga’s parents sensed she lost interest in school and that she was “associating with a young man who is not appropriate,” her defence lawyer would later tell a judge. By the time Coles was finished with her a few months later, Manga pocketed little more than $1,200 and was headed for a six-year prison sentence.

The day of the deal, at 2:15 p.m., Manga drove her mother’s silver Volkswagen into a McDonald’s parking lot one block from the Windsor side of the border tunnel.

Manga got out and then into the buyer’s truck. The vehicle was wired for sound and video. “It recorded everything,” a court would later hear. The buyers were two cops on loan from the Toronto Police Service.

Manga sold them a Star 9-mm, loaded with four rounds, and a Glock 9-mm, loaded with 12 rounds, for $2,200. She said she would return that night with the two other guns. The undercovers handed her an additional $2,200 in advance.

Agent Jackson was on the other side of the tunnel, waiting and watching. He followed Manga, saw her meet with a man — later determined to be an associate of Coles — and watched as he stuffed a wad of cash into his pocket. Manga drove off, Jackson not far behind, and met the same man on a dark side-street two hours later.

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“I assume they were loading guns in her vehicle,” Jackson said. “Denisa told the undercovers . . . she had a void in her vehicle in front of the dash, in back of the engine. That’s the exact location she was standing, kind of in the corner of her hood there.”

Close to 10 p.m., Manga met the undercovers in the same McDonald’s parking lot, and handed them two loaded 9-mm pistols, one with the serial number partly obliterated. Manga was paid her $500 smuggling fee.

One of the undercover officers called Coles the next day and said he needed more “burners.” Coles, who often had guns “on deck,” delivered quickly.

From February to June of 2008, Coles sold 35 guns for $36,000, all to the undercovers working the investigation.

Months later, police officers would trace the guns to points of original sale in Michigan, Ohio, Kentucky, Georgia (all intersected by Interstate 75) and other states where firepower can be legally bought with few background checks and little oversight.

The Star learned that most of the guns delivered by Manga had been sold anywhere from six to 10 years earlier at a Detroit gun store now out of business.

It is not clear how many hands the guns passed through before reaching Coles and ending up under the hoods of his bootleggers’ cars.

On Feb. 13, Manga made another border run, delivering four guns, including a Cobray MAC-11 machine pistol loaded with 19 rounds in an extended magazine.

A few weeks later, Agent Jackson finally laid eyes on Coles. The undercover officers had arranged to meet their supplier in a room at a Detroit Marriott Hotel. Jackson and Windsor officer Bellaire set up cameras and microphones and eavesdropped from the adjoining room as Coles discussed future gun deals and his desire to get a large amount of ecstasy pills.

Jackson, comparing the image on the live video feed to a mug shot from Coles’ Michigan driver’s licence, conclusively identified his target. “The man behind the curtain,” as Jackson later called him, was revealed.

On March 18, another of Coles’ smugglers delivered four guns to Windsor. Other deals occurred on April 9, in mid-May and on June 2.

Agents never could identify who was supplying Coles, theorizing Coles got his guns from a variety of sources. Coles told the Star he bought the guns “off of the streets of Detroit.”

“On June 4, we did one last deal,” a Windsor detective later testified. “Multiple arrests took place that day.”

At 2 p.m., Coles and a male associate pulled into a strip-mall parking lot on Jefferson Ave. in Detroit.

Coles’ Toronto clients had come through. In a few moments, he would deliver nine guns, just a down payment, for 50,000 ecstasy pills his clients were looking to unload that day.

“(Coles) was asked a couple of times if . . . he could handle that amount of ecstasy and he said . . . that the ecstasy was accounted for and he could move it ‘all day,’ ” Jackson later testified.

Jackson watched from an unmarked sedan parked across the street from the strip mall. Other police cars were in the area to cut off possible exits should the planned takedown fail.

Waiting in the parking lot was an undercover ATF agent posing as a cousin of one of the Toronto drug dealers.

Coles noticed a grey van in the parking lot, walked over, tried to see if anyone was inside — but tinted windows blocked his view. Spooked, he tried to move the location of the exchange. The undercover agent convinced Coles to stay and get the deal done.

Coles walked to the trunk of the Charger, popped it, delivered the guns, and replaced them with a suitcase of ecstasy pills.

The pills were fake, cooked up at a U.S. Immigration and Customs Enforcement lab at the border.

The grey van was in fact full of ATF agents suited in tactical gear for the arrest.

The deal done, Coles got in the Charger and his accomplice drove away. The Charger sped past the grey van. Agents scrambled from the van, yelling at the Charger to stop but were too late.

Agent Jackson watched the failed takedown and drove up Jefferson Ave. toward the parking lot. “The Charger was coming at me.”

Jackson drove his sedan into the Charger, stopped it, and agents swarmed.

Coles clambered into the back seat, trying to squirm away from his captors.

“I saw huge weapons pointed at me so I attempted to get out of the line of fire,” Coles said.

At that point, Coles, whom the U.S. Justice Department later said was the “mastermind of a major international weapons smuggling operation,” likely realized that for some time he was no longer running a growing criminal enterprise; Agent Jackson had been running him for months.

Coles rejected a plea deal, fired four court-appointed lawyers and represented himself at trial. He made no opening statement in the federal courthouse in Michigan. He introduced no evidence. He did not testify in his defence. He lost. Guilty on all 18 counts.

While behind bars awaiting sentencing, Coles became an ordained minister.

Meanwhile, across the border at Denisa Manga’s 2008 sentencing hearing, a judge told her: “You have forsaken the life that you knew and for the friendship or companionship of someone who probably does not value you as highly as you ought to be valued, and for a few dollars of money.”

Manga, who did not comment for this story, is now out of jail. The other smugglers, all American, pleaded guilty in U.S. court and cooperated with investigators. They received sentences of various lengths, none as stiff as the 15 years handed to Coles.

Coles now lives behind the walls of McKean Federal Correctional Institution, about 145 kilometres south of Buffalo. In penitent emails to the Star, Coles said he is a different man, that his “true passion” is to help others.

“It’s a shame that you can obtain guns so easily through license(d) dealers which in turn flood the inner city streets with powerful weaponry,” he said. “It saddens my heart to hear that Toronto is becoming more gun violent.”

THE SERIES: THE GUN PIPELINE

Today: The brokers

Friday: The mules

Saturday: The guns

David Bruser can be reached at dbruser@thestar.ca or 416-869-4282.