。。
Watch out. The cops are sniffing around.
Literal
Attention-[imperative-て]. Police [genitive-の] dog [subject-が] sniffing-around [progressive-てる].
Slang/criminal register. 警察の犬 ('police dog,' literally) is being used metaphorically for 'the cops' or 'police informants' — an insulting term suggesting they sniff around like dogs. かぎ回る ('to sniff around, nose around,' literally 'smell and go around') is the verb for pestering, investigative inquiring. 気をつける ('to be careful') in te-form functions as a casual imperative: 'watch out.' Reads like noir fiction or a yakuza movie.