Dagmar is hired by Marguerite Gracq's father to watch over his daughter while he left town to find a better place to live. Marguerite dislikes her, as she didn't do anything but sit and listen to polka music on the radio. But Marguerite grows suspicious when paintings start falling in her house; they only fall when Dagmar is home and Marguerite is in the mines, and they fall too neatly. Marguerite brings home Lemony Snicket to investigate, and tells Dagmar; she responds in a cranky voice that Marguerite can do whatever she wants.
Lemony Snicket figures out that Dagmar had discovered the Gracq gold was melted down and turned into nails, which were used to hang the paintings, and she was stealing the nails in order to steal the gold. He calls the police on her, and she is arrested.