Jack and Topaz return Phillip Russell's mind back to him, and later fight Taboo and Algon!
In the Verdugo Mountain mosque of the sorceror Taboo, he orders his son, the mutated Algon, to slay the Werewolf. Algon, comatose for twenty years, was revived when Taboo's medium, Topaz, inadvertantly caused a mind-switch between Algon and Philip Russell, the step-father of the Werewolf's alter ego, Jack. When Topaz begs Taboo to end the conflict, he accuses her of betrayal and slaps her. The fight continues until dawn, when Jack becomes human again. Using Topaz as a shield, Jack tells Taboo to reign Algon in, but the wizard orders her to use her magic to overcome Jack. Topaz, who until now thought of Taboo as a gentle man, sees his his true self and refuses. Taboo relents, and allows her to leave with Jack and his unconscious step-father, but promises them death when next their paths cross.
At the Russell home, Topaz mentally sedates Philip, then removes the remants of Algon's mind. Jack feels the conflict of trying to save the man he hates for his suspected hand in the death of Jack's mother. He then announces his intention to return alone that night to Taboo's mosque, where the wizard currently prepares a mystic spell.
As Jack drives off, he is followed by two Committee goons. Jack evades them by forcing them to crash into his sports car and off a cliff, as he leaps to safety.
Back at the mosque, Taboo has created a simulacrum of Topaz, which he orders to begin a "power transference" into Algon. The mind of Philip Russell within Algon suffers through nightmare visions as Jack arrives and transforms. The ritual complete, Algon now has the power to transmute objects into gold, first transfroming an urn as he swings at the Werewolf and misses. He next transmutes a Buddha statue which Taboo runs toward, ecstatic about his newfound wealth. But the stone pedestal beneath the statue crumbles, unable to support the new weight of the gold, and the sculpture crushes the wizard. As Algon stares at his father's body, the Werewolf topples him into a mystic brazier. Algon and the mosque become engulfed in flames, and a collapsing ceiling pins the lycanthrope. The next morning, the somewhat smaller Jack wriggles free.
He returns to Philip's house to find that with Algon's death, his step-father's mind returned to its rightful place. Philip then tells Jack a long overdue story: Philip is the brother of Jack's father Gregory Russoff. He had introduced Jack's mother Laura to the Baron and they married, while he moved to the States and Americanized his name to Russell. When the Baron became a werewolf and was killed, Laura came to the U.S. where she and Philip wed. Philip's subsequent troubles with the Committee stemmed not from blackmail against him, but against Laura, regarding the Baron. When Philip didn't pay, they had the family chauffeur rig Laura's fatal accident. Now knowing the truth, Jack and Philip reconcile.
A week later, Jack and Topaz leave for eastern Europe to look for clues regarding Jack's heritage.
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