I'm going to guess that your question is referencing Chapter 11, in which Kevin and Max attempt to return Loretta Lee's stolen purse.  In this chapter, Max quickly gets a bad feeling about the place they've come to and the people they are about to meet, but once Loretta opens the door, he has a difficult time making an escape.  Kevin says several times that he has to return home, but his comments are ignored. When Iggy sees the unlikely duo of Freak and Max, he seizes the opportunity to make fun of others who are weaker than himself. In fact, 

. . . he gives Loretta this secret look, like he's going to have some fun here.

He proceeds to question the boys, to make threatening remarks to them, even suggesting that they might have stolen money from Loretta's purse.  However, his whole attitude changes when Loretta suddenly remembers why Max looks so familiar to her.  As soon as Iggy realizes that Max must be the son of "Killer Kane," he stops the harassment.  He explains:

''What if Killer Kane hears I was messing with his kid? No thank you."

Knowing who Max's father is is enough to stop Iggy's torment of the boys, and they soon are able to make their way out of the apartment unharmed.