Jonathan Crane is sitting down remembering a time Batman threw him in prison. He also remembers a time where Batman defeated Scarecrow in the air . Determined to get his revenge, he decides to discover Batman's identity to torture him. He creates a machine to relay the fears you see from his fear gas to see what the feared see.
He uses his machine to turn Killer Croc into his personal henchmen by giving him terrible memories about his abusive aunt and bullying as a child and Arnold Flass as his gunman by his fear of being discovered by the police. With his gang ready, Scarecrow stages a crime to get Batman.
Scarecrow has Arnold Flass lie shot on the ground about half of a mile from Wayne Manor . Batman sees Flass "bloody" and Croc begins fighting Batman. He knocks Batman unconscious and Scarecrow takes him to his secret lab.
Waking Batman up and activating the machine, Bruce witnesses the night his parents died. In shock, Scarecrow deduces Batman's identity as Bruce Wayne. Batman, in serious mental pain, convinces Killer Croc to fight back against Scarecrow for unleashing his horrors. Croc slams Scarecrow's head against the wall and knocking him into a coma. Flass "captures" him and calls an ambulance.
GCPD doctors say he lost memory from the last week and Batman's identity is not remembered by Scarecrow. Sitting in Wayne Manor, Batman is frightened and worries that his identity almost entered the criminal underworld.