On the south side of the Thames, in the grungiest district on the river, there is an inlet with an island — Jacob's Island. At high tide, Jacob's Island is surrounded by the muddy water of Folly Ditch. On the island are crumbling warehouses and abandoned dwellings. The whole area is disfigured by "every repulsive lineament of poverty, every loathsome indication of filth, rot, and garbage." The houses become havens for the needy and desperate. Think of these people as the Victorian equivalent of homeless wanderers and street people.
In the upper room of one of these larger ruined dwellings, three persons are gathered, in evident anxiety. They are Toby Crackit, Chitling, and Kags, a middle-aged convict who has sneaked back into England (after having been "transported" to a penal colony). Crackit has chosen this hideout as a last resort.
Chitling now describes the disasters that the gang has experienced: Fagin was arrested, Noah Claypole was taken at the same time, while Chitling and Bates made their escape. When Betsy had gone to identify Nancy's battered body, the sight drove her out of her wits. She was taken to a hospital in a straitjacket.
Kags predicts that Fagin, as an accessory before the fact, may be tried and hanged within six days. Chitling describes how a crowd of people battled with the police to get at Fagin. The officers had to form a cordon around the battered old man to rescue him from the fury of the mob.
Sikes's dog comes into the room. The animal is grimy and spent from running. The fugitives are apprehensive, thinking Sikes cannot be too far behind the dog. They hopefully conclude that he has left the country, leaving the dog behind.
