Lt. Columbo delves into the world of magic, ESP and slight of hand as he investigates the death of a magician, and there appears to be a tie to a prodigal psychic supported by a government founded institute on parapsychology.

Frank Brailie runs a private military foundation for wanabe soldiers owned by the wheelchair bound General Padget. The General has become suspicious of Frank as a great deal of money seems to be going to a Special Projects Fund. The General tells a close colleague to investigate Frank and the Special Projects Fund. Instead of reporting his fraudulent findings back to the General, he decides to blackmail Frank for some of the money, Frank agrees and starts to plan his murder.