Jones was (first) discovered in the palace in December 1838, after a night porter noticed him staring through a window. The porter raised the alarm, and a chase ensued that ended with Jones apprehended. He was taken to the kitchen and searched, where they discovered that he not only had several pairs of Queen V's underwear in his possession, but was also covered from head to toe in grease. Why? Because that enabled him to squeeze into the palace's chimneys, where he'd been living for the past year.
During the day, Jones would hide in the chimneys, or the walls, or if he wanted to mix things up a little, behind large pieces of furniture -- sometimes getting so close to Victoria that he was able to eavesdrop on her conversations. When night fell, he'd leave his spider hole and wander the halls to steal whatever personal possessions he could get his soot-covered hands on, as well as visit the kitchens to eat and wash his shirt.
After a lengthy trial, Jones was not found guilty (somehow). He repaid the Universe for this stroke of luck by squatting in the palace again. He was arrested and sent back to trial, where -- after attempting an insanity plea -- he was given three months probation. On release, he was arrested again while trying to break into the palace, and at yet another trial, he was given three months of hard labor, presumably to get him too swole to fit in a chimney.
The police begged Jones to do something productive with his talents, but he remained fixated on Victoria. After he was arrested for a fifth time, he was hauled off to Brazil, returned to Britain, and then sent away again, this time to Perth. As karma for a life spent violating people's privacy, Jones spent the rest of his days annoyed at jokes about being the creep who stole the queen's panties.