Mrs. Alvarez is the widow of Ramon Alvarez, the murder victim that Riggs and Murtaugh were investigating the death of.
As Murtaugh and Riggs were investigating the death of Ramon Alvarez, they found out that he was involved in something he never wanted to get mixed up in. Mrs. Alvarez kept it a secret for a while, and when Riggs questioned her further on what all was going on, she explained that her son Oscar was kidnapped by Levon Tibibian, Daryl Hennicky, and the rest of their men, and remains to be held hostage until she can give Tibibian and his men the heroin Ramon stole from. Riggs goes after them and gives them their heroin and gets Oscar. Just when it's about to go bad, a shootout occurs, Riggs gets Oscar out of the way, and Murtaugh joins in and they shoot them all down, including Tibibian. Oscar is soon after reunited with his mother.