- Edmund is brought back to his master's house by the men on horses. They pin his arm to the wall and are all ready to cut it off when a new voice orders them to stop.
- Edmund's captors explain that Otto was found guilty of "coining debased pennies" (2.12), a.k.a. counterfeiting coins by mixing the metal with cheap stuff.
- Geoffrey, Sheriff of Nottingham, orders them to put Edmund in shackles.
- Edmund is walked through the streets of town and locked in a dungeon. He recognizes the men who lock him up—they're from town, not from London. Some neighbors.
- He thinks about how all the young and brave men have already been sent off to fight in the Crusades, and then he thinks about how he's guilty of his master's crime.
- Edmund starts pondering how he used to always daydream about the Crusades. Mainly he just always wanted to prove himself worthy of Elvira, a merchant's daughter whom he has grown up with.
- The next morning, Edmund is sore from being chained up. His thoughts turn again to his master, who was kind of a father-figure to him. Edmund knew Otto was blending silver coins with copper, but Otto had always told him there wasn't anything really wrong with it.
- Without hesitation, Edmund accepts his guilt—in his world, if his master is guilty, he's guilty, too.
- When the guards come to feed him, Edmund asks for news of Otto but there is none. He prays to Saint Peter for protection.
- A deputy comes in to announce that Edmund has "business" with the sheriff. Which he knows isn't a good sign.