After two years working as a clerk for the International Fruit Company in London, Jerry Mason is dissatisfied by his lack of career prospects. He gets the chance to make a change when he learns his uncle has died and left him a property in his will. Jerry immediately resigns and decides to manage his inheritance, the Hotel Splendide in Speymouth-on-Sea.

On that same day, the burglar Charles Miller, known as "Gentleman Charlie", is released from jail after serving a five-year sentence for robbery. His progress is monitored by Scotland Yard, and by a rival gang of crooks headed by "Pussy" Saunders. Both are after the Dysart pearls, which were stolen at the time of Charlie's arrest but never recovered. Charlie is told by his confederate "Slim" that a hotel, the Splendide, has been built over the site where the pearls were originally buried. Charlie decides to head out there the next day, with Saunders and Scotland Yard deciding to follow him.

The next day Jerry arrives at the Splendide, which he discovers to his dismay is a rather run down second-class hotel. He is met by the manager, Miss Dacre, who shows him around and introduces him to some of the guests. These include the wheelchair-bound Mrs Le Grange and her niece Doris, and Mr and Miss Meek, a brother and sister. Jerry decides that he and Miss Dacre will run the hotel together, despite the fact that it is in serious debt. Jerry decides to put up a flag to help advertise the place. While digging a hole for the flagstaff, he comes across a metal box that he throws into the bushes. Soon after, a number of guests arrive, including Charlie and Slim and a Mr and Mrs Harkness, who say they were drawn by the place's new flag.

During lunch, Mrs Le Grange mentions that there has been digging in the grounds, a fact that seems to interest all the guests. Later, Mr Harkness comes across the box in the grounds, and decides to use it to prop up the window in his room. When Jerry arrives to fix the window, he throws the box out the window, and it lands at the feet of Saunders who quickly takes it to his room, a fact observed by Mrs LeGrange. She presses the fire alarm and in the confusion, Doris falls into Charlie's arms, stealing his room key in the process. When it is clear that it has been a false alarm, the guests go out of the hotel while Mrs LeGrange says that she wishes to rest. When they have left, she lets herself into Saunders' room and takes the box, an event witnessed by Jerry. Jerry follows her back to her room, at which point "Mrs LeGrange" rises from the wheelchair and says that actually she is a he, a detective named Hawksby. He asks Jerry to hang on to the box until he can arrest the whole gang.

Jerry is seen by all the guests taking the box to his office. Doris races to her room demanding to know what is going on, so revealing that "Mrs LeGrange" is actually Saunders. Later they both go to the office to reclaim the box, but Jerry has locked it in the safe and can't find the key. Later that night Charlie breaks into the safe and retrieves the box, but he is attacked and killed by Saunders. Jerry and Mr Meek hear the noise and head to the office - they are forced to break in, which attracts the attention of all the other guests. Saunders' black cat, his calling card, is found sitting over the body. Jerry, followed by all the others, follows the cat to Saunders' room, where Mr and Miss Meek soon overpower both Doris and Saunders. The Meeks are in fact both working for the police. When they recover the box, they discover that is has been opened with a tin opener. Jerry then reveals that he is now in possession of the pearls, and that he will be able to claim the £10,000 reward.