The Chinese detective investigates a psychic who blackmails people and causes suicides and murders.
On a plane Jimmy Chan (Victor Sen Yung) is scared of dying. Paul Essex (Louis Jean Heidt) gets a radiogram from the Zodiac and is found dead. Thomas Gregory (Douglass Dumbrille) takes Paul's briefcase. In San Francisco Charlie Chan (Sidney Toler) tells Stella Essex her uncle is dead, and Redley tells Charlie that Paul feared Zodiac. Police welcome Charlie and introduce him to magician Fred Rhadini (Cesar Romero). Zodiac is suspected for several suicides. Charlie gets a warning about the supernatural but goes to see Zodiac, joined by Rhadini and reporter Peter Lewis (Douglas Fowley). They ask the masked Zodiac to contact Paul's spirit. Zodiac's guide denies blackmail and warns Peter that Eve Cairo is not for him. Charlie says that Zodiac dominates and must be exposed. Jimmy tells Charlie he found Gregory but lost him.
Charlie goes to Rhadini's party to meet Eve Cairo (Pauline Moore). Myra Rhadini (June Gale) is jealous of Bessie Sibley (Billie Seward). Gregory arrives. Jimmy calls Charlie that he invited Gregory so he could search his room. Rhadini presents mind-reader Eve Cairo, who reads Charlie's thoughts and then perceives evil. Charlie, Rhadini, and Peter find Jimmy at Zodiac's. Charlie shows how Zodiac uses foot pedals. The Turk (Trevor Bardette) comes in with a gun but is made to drop it. Charlie accuses him of trying to kill him at the party with a knife. The Turk escapes by a secret passage. They find it and open the safe that has files on people for blackmail. Charlie finds Bessie's file and evidence that Paul was blackmailed. Charlie burns the files. He reads Paul's manuscript about a psychic blackmailer, but the end is missing. Gregory comes in and says he is an insurance investigator. Charlie promises to help but doubts he is such.
Charlie has Rhadini challenge Zodiac to a test. Charlie finds a note on the last page of the manuscript. Rhadini performs magical illusions and calls up Charlie, Jimmy, and police chief Kilvaine as the Zodiac comes in. Rhadini levitates Eve, and Zodiac is found shot by a short arrow; the dead man is discovered to be the Turk. Kilvaine says that Gregory is an insurance detective. Charlie re-creates the crime scene, and Rhadini is wounded by a knife. Myra asks to see Rhadini. Charlie asks telepathic Eve to help and hypnotizes her. Eve explains Zodiac's blackmail and his desperate victims. She says that Zodiac is alive and killed his assistant, the Turk. They catch Rhadini before he shoots her, and Charlie proves that he killed the Turk with the dart.
In this mystery the illusions of sleight-of-hand magic
are differentiated from mental telepathy, which is acknowledged
as an ability some people have. Using people's secrets for blackmail
is exposed for its bad consequences.