"He admitted this to me. He wants to make amends to his friend"
When did he admit this to you before or after he was caught?
"It all seems so overwhelming to me. I know my son is full of intense pain, he is ashamed and embarrassed. He basically lost his best friend. He was totally stupid and knows it."
It seems his pain is connected with his being caught hence the shame and embarrassment do you feel this?
"I guess I need some guidance. I could throw the book at him. I'm worried about why he did this....I mean, his best friend?"
It does not matter that it was his best friend would it be any better if it was an enemy or a stranger?
"Recently he admitted to me that he smokes pot (the only drug he's doing) for the last six months. His grades are crap."
Was this also due to his shame and embarassment at this incident? As a 16 year old my strategy was only to offer up what will cause more pity or support/lenience for my ego's sake. The "I've tried mj several times could garner some understanding and false compassion.
Stand back at look at your son. Why is he at this point and is he taking full responsibilty for his lack of ethical behavior? most people 9if not a sociopath) are very sorry when caught, they are sorry that they WERE caught. If they truky felt it was wrong they would not do it.
For transgressions like these it is best to admit that your son has some discrepancies with moral and ethical behavior not just on the level of action but also in thought. Perhaps to dialogue with him and allow him to naturally reveal his stance on various ethical or moral dilemmas and point out where yours and his differ. Also find out what he is willing to do inside to change. If he truly seeks change it will be apparent and he should be supported and encouraged. At the least find out where he is and accept it either way, he will have to change himelf, if not so be it.