Josephine Bonney, the mayor of Bonneyville and a former schoolteacher, is besieged by town citizens demanding action when a gang of ruthless racketeers establishes a "Merchants' Protective Association" and roughs up any who do not join. The drive to recall Jo is led by attorney Fred Morgan, a would-be candidate for her job, who is actually the boss of the racketeers, assisted by businessman Daniel J. Roman. Jo assures her constituents that she is sending for a man who can control the situation, after which she secretly hires Pete Braddock, a former pupil who has retained affectionate feelings for her in spite of his own decline into gangsterism. Despite her sister Lydia's distrust of Pete, Jo is certain that he can go straight and clean up the town from which he ran away fifteen years ago. Jo introduces Pete to police chief Dave Evans as John Wilson, a special investigator from Chicago. Jo insists that Pete stay at her house, and he quickly becomes enamored of her lovely niece Sally, who knows his true identity as the town's former bad boy. The night of his arrival, Pete and Sally visit one of the gambling joints run by the racketeers, and Pete captures the two thugs sent to kill him after he wins big at the tables. The next day, the thugs give Pete the addresses of the town's other gambling establishments, and soon Pete has smashed the gambling ring. Jo holds another town meeting and introduces Pete as John Wilson, and the town cheers him. Pete then visits Roman, whom he warns to get out of town. While they are talking, Morgan enters the office and, before he sees Pete, reveals that he is head of the gang. Pete tells Morgan that he also must leave town, but quickly changes his tune when Morgan and Roman offer him a large bribe. Pete agrees to accept $25,000 over a four-week period in exchange for his silence, and he aids them in making their protective society legitimate by publishing a magazine in which merchants are forced to advertise. Two weeks pass as Pete and the racketeers rake in money, until Jo collapses on her birthday, which Pete had forgotten for the first time in fifteen years. Pete is grief-stricken over Jo's illness, and her and Sally's absolute faith in him prompts him to inform Roman and Morgan that the deal is off. Roman laughingly tells Pete that he is in too deep, and threatens to tell Jo about the bribes if he does not leave town. Ashamed and discouraged, Pete leaves town, and Morgan demands Jo's recall. At a town meeting, Jo wearily tells the citizens that she will offer no defense and is about to resign, when a bloodied Pete arrives, bearing a beaten Roman and the ledgers that will convict the racketeers. Pete reveals Morgan's leadership of the gang, and the crowd cheers Pete and Jo. After Lydia agrees to marry Dave, and Sally embraces Pete, Jo cheerfully admits that she had no idea Pete was temporarily in with the gang.