At home, Nell pleads with her grandfather to share his pain with her. Nell declares that she would rather be a beggar and be happy at it than be stuck in their current, miserable situation. As she cries, Mr. Quilp sneaks into the room. He has heard their entire conversation. When Nell and her grandfather realize Mr. Quilp is there, Nell is dismissed so they can speak privately. Mr. Quilp reveals the grandfather’s secret: He has no money at all, having gambled away what little money Nell’s deceased parents left her. Desperate to win even a small amount to secure Nell’s future, the grandfather began borrowing money from Mr. Quilp, but he has also lost all these sums at the gambling table. When the grandfather asks who betrayed his secret, Mr. Quilp simply asks him, ironically, who he “think[s]” did it. The grandfather guesses that it was Kit, and Mr. Quilp confirms this conclusion—even though it is false. Mr. Quilp deduced the grandfather’s gambling on his own, using information gathered from his eavesdropping, including Nell’s own admissions to Mrs. Quilp earlier in the week.