Fagin yells at the Dodger and Bates, asking what has become of Oliver; the Dodger finally replies that Oliver has been taken by the police, and Fagin, enraged, attempts to throw a pot at the two boys. But at this moment a burly man and his dog walk into the apartment, and Fagin nearly hits the man with the pot. The man, aged thirty-five years, demands an explanation from Fagin, and says, contemptuously, that Fagin ought not to mistreat the boys in this way.
The relationship between Fagin and Sikes is never fully explained. It appears that Sikes is simply a partner-in-crime, but it is also possible that Sikes was a young man "raised," in part, by Fagin. Nancy, of course, was directly under Fagin's control when she was younger—just as the Dodger and Bates are now.
The burly man, who Fagin refers to as Bill Sikes, continues berating Fagin, saying that, if he were Fagin's apprentice, he would have tried to kill Fagin a long time ago. Fagin appears deferential to and fearful of Sikes, and gets him a drink while Sikes sits down in the apartment.
Fagin is terrified of Sikes' physical strength, but Fagin also appears willing, in later scenes, to use his cunning to defeat the burly housebreaker. Sikes and Fagin are yin and yang—two possibilities for crime: brute force and sly calculation.
Fagin worries, aloud, to Sikes, that if Oliver has been caught, and has given up information about Fagin to the police, then Fagin and the boys could be in trouble. Fagin also insinuates to Sikes that if he (Fagin) is in trouble, then that same information would cause Sikes to be in even more trouble, for crimes Fagin does not mention or describe.
One of the gang's, and Fagin's, constant fears is "peaching," or the potential for members of the gang to rat out the group's activities to the police. Fagin does all he can to instill in the group the idea that one must never, ever talk to the authorities because then the law would come for the "peacher" too.
Just at this moment, Bet and Nancy return to the apartment. Sikes and Fagin have resolved that someone needs to go to the court to determine where Oliver is, and what he has said to the authorities. Fagin asks Bet to do this, but she declines; he asks Nancy, and Sikes does also, but Nancy also declines. But Sikes eventually threatens Nancy sufficiently that she is forced to go, and Fagin and Sikes makes sure she is dressed "respectably," so as not to arouse attention at the court.
Bet and Nancy's occupation is never explicitly stated—it is possible they are prostitutes, though Victorian mores would probably have precluded Dickens from saying so outright in the novel. Both clearly have ties to the other criminal activities in which the group engages: thieving and pickpocketing chief among them.
Nancy goes to the court to try to find Oliver, claiming that she is Oliver's sister, and she is looking for her beloved "Nolly." But a guard tells her, finally, that Oliver has been taken by "the gentleman" (Brownlow) into his home near Pentonville. Nancy takes this information back to Fagin, who dispatches Sikes, Nancy, the Dodger, and Bates to find Oliver and Brownlow, before Oliver tells the gentleman any information about Fagin and his crew.
Nancy is a very talented actress and liar; she manages to convince everyone she sees that Oliver really is her brother. Of course, the irony here is that Nancy does become attached to Oliver, later on, and does what she can to save him from Monks. She becomes a kind of sister to him.