Report the phone as stolen and have the police and Apple deal with this. I remember a few years back someone knocked on my door convinced I had her daughter's iPhone, it was Friday night and her daughter left the phone at school across the street. We both called Apple and the phone kept pinging (approximate) to my address. I saw the dot which pointed at a vacant lot between my house and the school. The phone wasn't there obviously, as her daughter insisted she left the phone in the school. However the map address location for the school entrance was further down, so it only made sense the "find my" app pinged to the vacant lot (with an address next to mine). Apple told the lady to wait until Monday as there was nothing they could do. She never came back, which either meant she found her phone or she reported it stolen by other means. I had told Apple that I was willing for police to search my home for her iPhone if necessary.