America's G-Men have become targets, out-gunned and out-maneuvered by Mexican gold smugglers. Enter Alan O'Connor, a federal agent, with his sweetheart Bobbie Reynolds in tow. The two suspect the gold is from a mine in Los Morados, a small town outside of Mexico City. They become regulars in the Tarentella Cafe where Bobbie shows off her singing talents and Alan eyeballs the local henchmen. Discovering a link to an aviator's gold bricks found by the Department of Justice, they uncover the true location of the mine. As Agent O'Connor goes in for a closer look, Bobbie is kidnapped while the smugglers pack up to flee.
For producer George A. Hirliman, The Gold Racket is one in a series of "G-Men" films (Yellow Cargo, Navy Spy and Bank Alarm, 1936-37) starring Conrad Nagel as detective Alan O'Connor. Hirliman's wife, Eleanor Hunt, stars as Bobbie Reynolds, resident love-interest. Director Louis J. Gasnier was a major figure in silent films before his switch into sound, his most well-known feature being Reefer Madness (1936).