Nobody thought to look in the caves.

Andrew: It looks like that thief we're looking for is hiding in that cave...

Thief: Hey, what are you doing in MY ca... uuh... SECRET HIDEOUT?
(The thief is sitting on a small pile of various treasures)

Questalot: We are on a quest to save the nearby town from the evil thief who has stolen most of their valuable items!
Thief: Really? Me? Evil?

Andrew: She... doesn't look like a master thief... What's with the pointy ears anyway?
Thief: HEY! Have you never seen an elf before?

Andrew: I... don't know...
Questalot: Hand over the stolen goods! We're taking them back!
Thief: I... can't let you... do that...

(A short fight later...)
Thief: Ow... I couldn't help stealing those things. They were so... shiny...
Andrew: Hmm...

Questalot: This doesn't seem right... Maybe we should just let her go...

Andrew: We shou....
Angry mob: AHA! THIS MUST BE THEM!
Andrew: This isn't good.