Detective Chan uses a second murder and a seance to catch the murderer of a lost heir who had suddenly returned.
A diver retrieves the briefcase of Allen Colby, and Charlie Chan (Warner Oland) discovers attempts were made on his life. In San Francisco Mrs. Lowell (Henrietta Crosman) thinks Allen is dead because of her Ouija board. Allen Colby climbs over the wall of the Colby House and is killed while correcting the hands of a fast clock. Fred Gage (Edward Trevor) and Janice Gage (Astrid Allwyn) come in to prepare for the seance. Chan arrives; he suspects Allen Colby is alive and in danger. The other Lowell daughter Alice (Rosina Lawrence) arrives with reporter Dick Williams. In the seance medium Carlotta (Gloria Roy) says Allen Colby is there when suddenly his face is seen. His body shows that he was knifed in the back. Mrs. Lowell says that Allen had quarreled with his father and objected to psychism. Fred says that the clock was fast at 5:30, and someone reset it. Chan stays there and investigates the malevolent spirits with the spooked butler Baxter (Herbert Mundin). Mrs. Lowell comes back. Charlie asks about the music during the seance and finds a radio speaker in the ceiling lamp and a switch near where Professor Bowan (Arthur Edmund Carewe) stood. Chan says that Allen's face glowed because of a chemical, and he finds the ultra-violet lamp that made it do so. Just as Mrs. Lowell says she plans to change her will, Chan pushes her down to prevent her from being shot. Fred comes in, and Chan sends him to the police to ask them to protect Mrs. Lowell.
Fred tells Chan that the caretaker Ulrich (Egon Brecher) blamed Allen Colby for his daughter's suicide. Chan asks Ulrich about the radio transmitter in his room, and he denies it was used for the seance. Carlotta explains that music is used for their seances but not the ultra-violet light. Professor Bowan gives Chan a shock. Police revive Chan. Mrs. Lowell plans to remove a bequest of $100,000 from her will for psychic research that was administered by Warren Phelps (Jonathan Hale). Ulrich comes in to quit.
Police guard the Lowell home, but she is shot in the head through the window. Alice blames Chan and cries. Chan admits his fatal error. Chan shows the police how a rifle activated from a bell tower can fire into the house on the hour. Police say they caught Professor Bowan; but he and Carlotta refuse to confess. Chan assembles the suspects at another seance in which Mrs. Lowell appears and speaks. A knife is thrown into the mirror at her image. Graphite from the knife on the hands of Fred proves his guilt, and he is arrested, as the daughters are relieved their mother was not killed.
Without disbelieving in mediumism and the spirits of ancestors Chan exposes contrivances, and by a faked murder he makes the murderer come forward, proving his aphorism that necessity may be the step-mother of deception.