On a bench on a street, Holmes picks up his phone. "This is Sherlock Holmes, I would like to talk to my father."
Holmes returns to the Brownstone. He tells Watson and Rhys that his father will be putting up the ransom on the condition that he performs certain services he'll find out later. They'll be meeting the kidnappers at a particular place, and Holmes sends Watson off to get his tablet. Then he tells Rhys that the money is primarily to get rid of him. "After today, our friendship has run its course. Have I made myself clear?" He has!
Special Agent Diaz (the guy from the club) knocks on the door of the Brownstone. He has urgent information for Mr. Holmes about the girl he's looking for. Watson lets him in. Out on the street, three men chase Holmes, so he calls Watson. He knew they weren't painters because their shoes were clean. Someone tipped them off. "Someone who had pull in the organization. Someone who also knew I was investigating Emily's abduction. Only one person meets those particular criteria." Watson says she knows: it's the DEA agent. And Agent Diaz is, in fact, pointing a gun at her and Rhys.
The fake painters follow Holmes's path up a fire escape. Agent Diaz has Watson's phone and says that Holmes's friends are alive. Holmes cheerfully says that he needs to scare up some transportation so he can get back to the Brownstone so they can talk. Diaz isn't into that plan. He also says he thought they'd be paying the ransom with Rhys's money. The scheme was for him to steal the money that he assumed Rhys had, then kill him and blame it on the Dominicans.
This whole time, Rhys and Watson have been tied to the bannister on the staircase. Their hands are zip-tied behind them. But there's good news: Rhys has a pocketknife! He saws at their bindings because he has an elaborate plan for freeing Watson, then her saving Holmes, and so on. When they're free, Rhys runs at Diaz and gets shot. They struggle, and Watson clonks Diaz over the head with a phrenology bust.