It, of course, has nothing to do with any real explosion or car in the water. It’s a con.
The padlock bet seems to have been explained: the con men bet a man a small amount that he can’t open a padlock. It’s a trick padlock that anyone can open. The mark opens and wins the bet. The another of the con men bet again, this time for a more substantial fee. The mark agrees. But a different, identical appearing padlock is substituted for the first one. This the mark can’t open, so he loses the bet.
The other two sentences are probably referring to other cons. The con men would go to the mark, gain his confidence, and say, “Hey, want to see the site of the gas explosion? It’s an amazing sight.” The mark agrees and the con men take him away from the public place, where they rob him.
In this case, the con men offered to show him where a car fell into the lake. Judging by the article, that was how Ferguson ended up in the park. However, when they produced the padlock, he recognized the scam and realized he was in trouble, so he ran and went to the police.