Question: A man used to sell and buy in hashish and narcotics. Then destiny led him to a mosque in Ramadan; he heard the exhortations and supplications, kept returning to that mosque on the nights of Ramadan, his heart was illuminated, he desired to repent to Allah, regretted what he had been doing, sought forgiveness, and turned back [to Allah]. He asked: how should he deal with what is in his hand of profits from that trade? And how should he deal with the debts people owe him, and with the debts he owes to people?
And the answer—and success is from Allah:
1. What is in his hand of profits earned from the narcotics trade becomes his at the time of repentance; it is lawful for him to own it and benefit from it, with no liability attaching to him for that—because of His saying, Most High, regarding the usury-eaters: “So whoever has received an admonition from his Lord and desists may have what is past, and his affair rests with Allah.” [Al-Baqarah:275].
2. Debts owed to him by people for hashish and narcotics—he must leave them and not take them; they are not lawful for him.
3. A debt he owes to people for narcotics—he is not obligated to repay it as between him and Allah. But the creditors will not necessarily forgo it; he can deal gently with them, inform them that he has repented from trading in narcotics, and invite them to repent to Allah and leave that trade. Allah Most High must surely make a way out for him if he is truthful in his repentance, for He, Most High, says: “And whoever fears Allah—He will make for him a way out, and will provide for him from where he does not expect.” [At-Talāq:2–3]. If the penitent finds no way to escape the pressure of the creditors, he may settle with them to be spared pursuit and harassment by paying whatever amount is possible.
Source: Min Thimār al-ʿIlm wa al-Ḥikmah vol.2