On December 1, short on the heels of a family tragedy (her police officer father lies in a hopeless coma, the victim of ruthless criminal Napolevich), FBI Agent Aurora Boralis is sent to Snowflake, Wyoming, (as toy designer Aurora Winter) to investigate Northern Lights Entertprises, whose toy division is suspected of being a money-laundering front for organized crime. She is greeted at the airport by Rudy, a teenage boy dressed as an elf. At the corporate headquarters that is built like a castle, Rudy introduces her to Holly, the human resources (all resources) director. Although Holly appears to be about 40 years old, she is less than four feet tall. When Aurora meets the company president, Klaus North, her day gets even more interesting. The jolly, portly man with a twinkle in his eye hires her with little ado and introduces her to glacier-meltingly-handsome grandson Nick. As the day pass, Aurora discovers she is enchanted by the quirky family and the company board of directors (all middle-aged; all under 4 feet tall). She finds no evidence of anything illegal and in fact witnesses charity on a global scale. Before she can report back to the FBI that there is nothing amiss, Klaus informs her he knows she is an FBI agent. He tells her to go back to work but figure out how to break the news to Nick who has become enamored with her. He asks what she wants for Christmas. When she replies that she wants her father back, he says, "I'll see what I can do." When Napolevich discovers her location, the FBI follows. There is a not-so-regular standoff involving radio-controlled helicopters and candy-firing cannons--and diminutive director Neva dressed as a tiny general declaring "I love the smell of gingerbread in the evening." Aurora witnesses Klaus (dressed in Santa suit) at the reins of a sleigh as it flies off into the night led by eight flying reindeer. Abashed, Nick comments, "You weren't supposed to see that." Napolevich loses against elfin magic and FBI skill; Klaus (Santa) returns from delivering presents--and he has brought Aurora's father (recovered from his coma). Aurora learns the family secret that the Norths have been the guardians of elfin magic for centuries, but the elves are actually in charge. The hat is enchanted. When Klaus retires, it will pass to Nick's father, and when he retires, it will pass to Nick. It is understood by all that Aurora will now be part of the North family and the Santa Claus legacy.