The Phone Police are a secret society of vigilantes in a similar style to such fictional organizations as the Thought Police or the New World Order and exist to enforce the "laws of the phone". Things such as prank-calling, leaving the phone off the hook, and other minor rules are enforced without mercy by the Phone Police—although many believe they are simply an urban legend. However the legendary Phone Police were much, much more than a mere boogeyman told to frighten children, as Jake found out when he foolishly rang the number of a certain "Billy Baxter" who then proceeded to phone him repeatedly asking for help. Jake proceeded to go to the Phone Company for help with his friend Chris, but the receptionist told them the number was old and discontinued: however, when Jake stated that he had rang the number and got a response, she sent them down to "records department" in the basement.
In reality, the boys had been lured into a trap and the Phone Police struck, however, Chris managed to escape as Jake was tossed into a cell. When Chris went to Jake's house to get help from Jake's sister he was greeted to hostility as she had forgotten all about her brother and his friend: the Phone Police had altered reality so that Jake never existed. Meanwhile, in the Phone Police's dungeon, Jake is still held in his cell as more children are taken to be imprisoned by the sinister enforcers - in the real-world Chris also finds more evidence of the Phone Police's changing of reality when he sees Jake's name in a phone book—having replaced "Billy Baxter". Chris phones Jake and comes up with a plan to save his friend: sneaking into the Phone Police's dungeon. Chris and Jake team up to stage a daring escape but are pursued by the Phone Police. The boys flee as the Phone Police give chase in their cars (complete with flashing green lights, a twisted take on real police sirens) -- Chris returns to Jake's home and finds out that by freeing him, reality has been reset and his sister once again remembers him. The Phone Police then seem to disappear and the boys are left wondering if it ever happened, only for their phone to suddenly ring ominously.