In a gloomy
house in London, the criminals, Jim Larrabee and his wife, Madge, at
present using the name Chetwood, are nearing the culmination of a daring
blackmail plot. However, to their dismay, they have heard that their
intended victims have engaged the services of the celebrated private
detective, Sherlock Holmes. Consequently, they are working with feverish
The pair are holding captive pretty Alice Faulkner (on the pretext that
she is insane), as well as her aged mother, in an attempt to obtain
letters and photographs that will enable them to blackmail a wealthy
family of foreign nobility. Alice's sister had died, with her child,
after being jilted by the family scion, and his letters would prevent
his imminent marriage should the scandal be revealed. The documents are
in a desk safe, but Alice has so manipulated the dials that the
Larrabees cannot open it. No extreme of torture has induced her to
disclose the combination.
Forman, the butler, hints that he knows of the plot, but Madge threatens
that she will expose him as a self-confessed forger if he interferes.
Forman sends Terese, the maid, who is leaving the household because of
the cries of the unfortunate Alice, to Holmes. The Larrabees call in
Prince, a safe-cracker, to open the safe; but when he is told that
Holmes is involved he hurriedly telegraphs to his chief, Professor
Moriarty, king of London criminals, who is waging a deadly feud with the
sleuth, and ever seeks opportunity to trap him.
Prince succeeds in opening the safe, but the documents are gone. Alice
has taken them. Larrabee is twisting her arm to extort from her their
hiding place when the doorbell rings, and the tall, lean figure of
Holmes is seen on the threshold. They hurriedly rush Alice upstairs.
Prince is assigned to wait outside to attack Holmes should he obtain the
papers. The laconic Holmes quickly foils Madge's attempt to masquerade
as Alice, identifies Larrabee and Forman as criminals, and compels them
to summon the real Alice.
She, bent on protecting her dead sister, is refusing to give up the
letters when there is shouting below, smoke pours into the room and
Forman reports that the kitchen is ablaze. The Larrabees and Forman rush
out, and Holmes, who has seen Alice's eyes dart to a chair upon hearing
the alarm, tells her that there is no fire; he has arranged the
disturbance in order to learn her hiding place. He rips open the chair's
upholstery and takes the letters, but when she weeps he returns them,
saying that she must give them to him willingly. He tells her that she
will be safe under his eye hereafter and she leaves the room. Holmes, on
his way out, warns the Larrabees that they will be watched. In spite of
the warning, they are about to resume the torture of Alice when three
mysterious knocks are heard below. Baffled and fearful, they resolve to
leave the case to Moriarty.
The next morning, in Moriarty's underground headquarters, the closing
net of Holmes is being angrily discussed by the arch-criminal and his
lieutenants. Moriarty resolves to decoy the detective's attendants and
visit him that night in his Baker Street apartment. Larrabee is brought
in. Moriarty, ordering him to get rid of Forman, the butler, as a
traitor, and to prepare counterfeit documents, agrees to checkmate
Holmes without sharing in the loot.
At Holmes' quarters that night, the detective is amusing himself by his
uncanny deductions as to the activities of his friend Dr. Watson who is
with him. They are interrupted by the maid, Terese, who reports that
Forman (actually one of Holmes' assistants and the mysterious
cellar-knocker) has been attacked in the Larrabee home. Holmes is about
to go to the rescue when the disheveled Forman comes to report that the
Larrabees are counterfeiting the letters. Billy, Holmes' body servant,
brings a letter from Larrabee, inviting Holmes to enter a closed cab at
eleven o'clock for a trip to a friend's home where, the letter informs
him, he may negotiate for the documents. Holmes sends Terese back with
instructions to tell Alice that he is unaware of the counterfeit.
Then, one by one, Watson, Forman and Billy are lured away, and the
sinister Moriarty enters, only to be covered by the expectant Holmes'
revolver. Billy, his coat torn in wresting loose from his captors,
returns and, at Holmes' order, takes a pistol from Moriarty's pocket.
The detective's jeering refusal of a truce drives Moriarty to grab
furiously for his weapon, but the trigger snaps futilely--Holmes has
adroitly removed the cartridges. Billy shows the enraged criminal out.
But, later that night, Moriarty's men are awaiting Holmes in their gas
chamber in Stepney where luckless traitors and other victims are put to
death. Larrabee also is waiting with the counterfeit letters when Alice,
who has followed him, enters. She has come to warn Holmes of the fraud.
Learning that his life is in peril, she attempts to buy his safety by
revealing that the real letters are behind the shutter of her room; but
she is gagged, bound and thrust into a closet when Holmes' arrival is
The detective, soon aware that he is in a gas chamber by noting the
caulking of the room and a lingering odor of gas, knowingly buys the
counterfeits for a thousand pounds; he also tempts Larrabee to snatch at
added money so that he may charge robbery. He grabs from the closet door
a knife hurriedly used to close it, and out pitches Alice. Moriarty's
men, in response to Larrabee's whistle, dash in and seize his pistol.
Alice declares her readiness to die with him, but Holmes smashes the
lamp with a chair, and, decoying his assailants to a window by the glow
of his cigar, hustles her safely out the door with him, dropping the
bars on his foes.
But Moriarty is not through. His men are seeking Holmes in vain at his
Baker Street place--they have even fired the house--and he has sent
Prince and Madge to Dr. Watson's office to learn if Holmes is there.
Madge is still at Dr. Watson's when there is a commotion outside.
Forman, disguised as a cabman, brings in a querulous, supposedly injured
old man--Holmes. The latter reveals that the police have trapped all the
gang but Moriarty, and, deducing that the arch-criminal is nearby in
disguise, he permits Madge to signal Moriarty by means of the window
Then little Billy, dressed as a newsboy, arrives to report that Moriarty
has emerged from a house across the way and is changing places with a
cabman outside, evidently expecting Holmes to enter the cab when he
leaves the premises. But the detective, hastily borrowing Watson's heavy
Gladstone bag, has the cabman summoned to carry the bag outside. When
Moriarty appears, Holmes pretends to help him with the straps to the
bag, then snaps handcuffs on his wrists. Moriarty, vowing vengeance, is
But Holmes has one last scene to play. Title visitors call for the
letters, and Alice, summoned earlier, is left in an anteroom where she
may overhear the conversation as Holmes, purposely and in presumed good
faith, hands over the counterfeit package. Alice, hearing Holmes
condemned as a fraud, emerges from the anteroom and presents the real
letters (as Holmes had planned) of her own free will.
Left alone with her, he confesses his deceit; but she declares her love
for him, and, despite his gloomy view of his own unworthiness, he takes
her in his arms.