Its the oldest "magic" trick in the world. She has in her hand a flesh shaped prosthetic thumb that fits over her actual thumb. When she stuffs the hanky inside her fist she is actually packing it in the prosthetic. It the slips over her thumb and she moves her fingers constantly so you can't see that one thumb is bigger than the other.
I have to say, she takes a $5 trick and makes it worth $20 with the nudity.
I have something else she could hide inside herself!