Susan is actually Allison, and FBI agent undercover as a dirty rookie cop. She had gone undercover as a cop to be recruited by Simon so the FBI would have some crimes to put him away with.
Terry (Nick Moran) is a cop undercover as a fence for crime boss Simon, whom the police can't pin any crimes on. Simon is throwing a birthday party and invites Terry and the wife Terry told him he had. Terry doesn't have a wife so he goes to his captain to get a female cop, Susan (Jennifer Esposito) to pose as his wife for the party only. Once at the party Simon shows a lot of interest in Susan, flirting openly in front of Terry. He mentions a country house and invites Susan and Terry. Terry tries to get out of it but Susan insists, telling Simon that they'll be there. After the party Terry is very angry she has wormed her way further into his investigation. Their captain likes the idea of them working together and tells them to set up in an apartment the station uses for witnesses.
The next day they get to the apartment and Terry notices how expensive her clothes look and mentions it. She claims she doesn't have a family or fancy car to pay for so she spends her money on clothes. The topic is forgotten and they head out to shop for groceries to make the apartment look lived in. While they are back and putting away the groceries they have a slight moment where they almost kiss, Terry backs away saying they don't need that kind of distraction. The next morning Terry leaves Susan alone in the apartment, refusing to tell her where he's going. When he gets to his warehouse he notices a hot dog vendor pull up as soon as he parks and a homeless man with clean hands sleeping near his entrance. He pretends to drop his keys so he can get to the gun at his ankle and he approaches the homeless man offering food. The man refuses and Terry pulls his gun on him, stating that its odd a homeless man is refusing free food, has such clean hands and doesn't stink. After a minute of searching he finds the communicator in his ear. Once he finds it the hot dog vendor comes running talking into a walkie-talkie, a couple of cars pull up and men pour out. They're the FBI and they take Terry into the warehouse to talk. They know he's a cop and they tell him they're interested in Simon. They didn’t let the cops know they were around because they suspected leaks in the department. They tell Terry Simon has a contract out on him and is going to be assassinated, and they're not going to do anything about it. After their talk he goes to his car finds a bug and throws it out. He goes to see Simon to tell him about the hit, the doorman tells Terry that Simon is having lunch with his girlfriend and they don't want to be disturbed, Terry goes in anyway and discovers that Simon is having lunch with Susan. Terry tells Susan to go home, she tries to tell him that Simon called and invited her but he just tells her to go home again. She leaves and Terry sits down with Simon. Simon speculates that Terry thinks he was coming on to his wife, and that if he were Terry he'd want to rip his heart out. He asks Terry if he wants to rip his heart out as he lays a gun on the table. Terry says no since Simon claims it was innocent. He tells Simon about the hit and he leaves. Susan is waiting for him outside claiming she needs a ride. She refuses to be dumped at the apartment again and goes with him to meet an associate of Terry's. They get there in time to hear him being murdered. They have a shootout with a guy in a leather coat but manage to escape. During the shootout we learn that the gun Terry carries in a shoulder harness isn't a real gun but a tape recorder made to look like a gun.
Susan and Terry head back to the apartment and end up kissing in the elevator. The kiss their way up to the apartment and once they get inside are interrupted by their captain, who is waiting inside for them. He tells them about the FBI and that he knows they were involved in a shooting. Before he can continue Terry gets a call from Simon who wants Terry to meet him now. He leaves and is picked up right outside by 3 of Simon's goons. They drive to a bar and park out front, they tell him the bartender that’s in there closing up is the one that took the hit to kill Simon and they want Terry to kill him. Terry tires to refuse but they insist, So he goes in, walks right up to the man and shoots him, he falls and Terry goes around the bar to him, he only shot him in the arm. He tries to tell the bartender to pretend he is dead and to stay away from Simon and disappear for a few weeks. The man won’t stop groaning so he hits him in the head and starts to leave. Before he can get very far the man pops up with his own gun and starts shooting at Terry. The goons hear the shots and go in to help. They shoot the bartender and all four walk away unharmed. As they are taking Terry home he needs to pull over so he can throw up. The goons all laugh about it and reminisce about their first killing.
Back at the apartment Terry is still very upset about the killing and he tells Susan about it. He seems to have forgotten that the goons are the ones that actually killed the man as he tells Susan about it. She gets him to give her the tape from his recorder and he tells her that it has proof that Simon ordered the hit of the bartender, but she says he cant use it because he will go down with him. She starts to burn it but is interrupted when he tells her a story of his dad being a cop and dying on duty. They talk some more and then go to sleep.
A series of scenes follow and I'm not sure if he's dreaming or if its some sort of foreshadowing but the scenes lead you to believe that Susan drugged Terry when she gave him a drink before he went to bed and that she was in on a hit with Simon and is his girlfriend.
When Terry wakes up we learn that he slept through a whole day and it is Friday, the day they are to go out to Simon's country home. He fights with her for a minute then they make up and start making out. Susan stops it to say they should quit; they should give their captain the tapes and let someone else finish the case. Terry says they will quit, but not until after they get Simon because he's invested too much of his life in it.
They arrive at Simons house and Simon greets them, barely looking at Terry as he does. Once alone Susan makes several comments on how rich Simon is while Terry checks for bugs. They start making out again and it's implied they finally have sex. Afterward as they're all sitting around Susan makes a comment to Simon about how he gets people to do things for him and he gets pissed, thinking she thinks he doesn't pull his own weight. After stewing in anger for a second he feels he needs to tell her about an "example" he needed to set in Terry's warehouse last week. (He killed a guy in the warehouse)
Afterward Simon takes everyone to some targets he had set up in his lawn and wants Terry to shoot first. He tells him to use his shoulder gun. Terry makes up a lie that it had jammed and hasn't been able to get it fixed. Simon insists on looking at it and Terry has to let him. After a few tense minutes of Simon looking over the gun he hands it back to Terry apparently without finding the recorder. Susan fakes an illness and they leave soon after. Terry drops Susan off at the apartment and goes to get all of the other tapes from his apartment. As he's pulling the tapes out of their hiding spot he hears footsteps coming up the winding staircase and its Susan with a gun. She tells him to drop the tapes and he flings most of them down the Vertigo-type staircase. She tries to tell him that Simon is coming and that he needs to hide but he's to busy telling her he almost trusted her. Simon and his goons come up and Terry says he thought the whole arrangement smelled like a set up from the start, the way Simon kept insisting on meeting his wife, and how Susan managed to worm her way in. He asks how long she had been on the payroll, Simon answers that it’s been quite awhile. They drag Terry to his warehouse and Terry yells that he had made backups and such; Simon doesn't believe him. They play a tape for Terry to hear, one she had recorded of Terry admitting he had killed the bartender. When Simon is about to shoot Terry in the face Susan shoots Simon in the hand and they manage to run back to an office while everyone else shoots at them. Terry tries to call 911 but is disconnected. The gunshots stop and after a minute of silence Terry thinks some cops must have heard the shooting and shown up. He stands to check it out and sees a uniformed officer talking to Simon, it appears as if Simon is giving him orders and when the cop turns around Terry recognizes him as the leather coat guy that murdered his contact earlier in the movie. A second later Terry's captain walks up and talks to Simon too and its obvious they are in Simon's pockets also. A hail of bullets go flying, none of them from Terry or Susan, as they are out of bullets. Terry dives on top of Susan to protect her, they look at each other and start kissing believing that they are going to die.
Suddenly the shooting stops and it is quiet. A voice calls out, it's the FBI and they have the building surrounded. The dirty cop calls back that they are the cops and have 2 murder suspects trapped. The FBI agents swarm in holding guns to everyone. The agent Terry talked to earlier ask if Simon is assisting the police or if they are assisting him. Simon shows him his hand and says he was defending himself. The agent isn’t impressed and calls for Allison, asking if she's ok. Susan answers that she is OK but Terry needs a doctor. Terry is shocked and Susan introduces herself as Agent Alison Reese FBI. Terry says his real name is Bill. They come out of the office and the agents are arresting everyone else. Simon tries to tell them that Terry is a killer and he has a tape proving it, but Susan/Allison had the recorder and the tape had miraculously disappeared. Terry reveals he had another recorder in his ankle gun and everything they need to put Simon away. Susan/Allison and Terry/Bill are standing outside near some police cars talking, she asks him what his name was again and he replies that he was going to ask her the same thing.
They kiss as the screen fades to black.