Common Crimes
Information on crimes that are commonly charged in Michigan. If you need legal assistance, please contact a lawyer.
Retail Fraud (1st, 2nd, and 3rd Degrees)
Statute: MCL 750.356c; MCL 750.356d(1)/MCL 750.356d(2); MCL 750.356d(4)
Crime Group: Property
Sentence Class: E (1st Degree; 2nd and 3rd Degree are misdemeanors)
Minimum Sentence: 0 Months
Maximum Sentence1:
60 Months (5 Years) (1st Degree
1 Year (2nd Degree)
93 Days (3rd Degree)
Maximum Fine:
$10,000 or 3x the value of the property whichever is greater (1st Degree)
$2,000 or 3x the value of the property, whichever is greater (2nd Degree)
$1,000 or 3x the value of the property, whichever is greater (3rd Degree)
Jury Instructions: MCJI2d 23.13
Sex Offender Registration Required: No
Statutory Language:
First Degree (MCL 750.356c):
(1) A person who does any of the following in a store or in its immediate vicinity is guilty of retail fraud in the first degree, a felony punishable by imprisonment for not more than 5 years or a fine of not more than $10,000.00 or 3 times the value of the difference in price, property stolen, or money or property obtained or attempted to be obtained, whichever is greater, or both imprisonment and a fine:
(a) While a store is open to the public, alters, transfers, removes and replaces, conceals, or otherwise misrepresents the price at which property is offered for sale, with the intent not to pay for the property or to pay less than the price at which the property is offered for sale, if the resulting difference in price is $1,000.00 or more
(b) While a store is open to the public, steals property of the store that is offered for sale at a price of $1,000.00 or more.
(c) With intent to defraud, obtains or attempts to obtain money or property from the store as a refund or exchange for property that was not paid for and belongs to the store, if the amount of money or the value of the property obtained or attempted to be obtained is $1,000.00 or more.
(2) A person who violates section 356d(1) and who has 1 or more prior convictions for committing or attempting to commit an offense under this section or section 218, 356, 356d(1), or 360 is guilty of retail fraud in the first degree. For purposes of this subsection, however, a prior conviction does not include a conviction for a violation or attempted violation of section 218(2) or (3)(b) or section 356(4)(b) or (5)
(3) The values of the difference in price, property stolen, or money or property obtained or attempted to be obtained in separate incidents pursuant to a scheme or course of conduct within any 12-month period may be aggregated to determine the total value involved in the offense under this section.
Second Degree (MCL 750.356d(1)/MCL 750.356d(2)):
(1) A person who does any of the following in a store or in its immediate vicinity is guilty of retail fraud in the second degree, a misdemeanor punishable by imprisonment for not more than 1 year or a fine of not more than $2,000.00 or 3 times the value of the difference in price, property stolen, or money or property obtained or attempted to be obtained, whichever is greater, or both imprisonment and a fine:
(a) While a store is open to the public, alters, transfers, removes and replaces, conceals, or otherwise misrepresents the price at which property is offered for sale with the intent not to pay for the property or to pay less than the price at which the property is offered for sale if the resulting difference in price is $200.00 or more but less than $1,000.00.
(b) While a store is open to the public, steals property of the store that is offered for sale at a price of $200.00 or more but less than $1,000.00.
(c) With intent to defraud, obtains or attempts to obtain money or property from the store as a refund or exchange for property that was not paid for and belongs to the store if the amount of money or the value of the property obtained or attempted to be obtained is $200.00 or more but less than $1,000.00.
(2) A person who violates subsection (4) and who has 1 or more prior convictions for committing or attempting to commit an offense under this section, section 218, 356, 356c, or 360,1 or a local ordinance substantially corresponding to this section or section 218, 356, 356c, or 360 is guilty of retail fraud in the second degree.
Third Degree (MCL 750.356d(4)):
A person who does any of the following in a store or in its immediate vicinity is guilty of retail fraud in the third degree, a misdemeanor punishable by imprisonment for not more than 93 days or a fine of not more than $500.00 or 3 times the value of the difference in price, property stolen, or money or property obtained or attempted to be obtained, whichever is greater, or both imprisonment and a fine:
(a) While a store is open to the public, alters, transfers, removes and replaces, conceals, or otherwise misrepresents the price at which property is offered for sale, with the intent not to pay for the property or to pay less than the price at which the property is offered for sale, if the resulting difference in price is less than $200.00.
(b) While a store is open to the public, steals property of the store that is offered for sale at a price of less than $200.00.
(c) With intent to defraud, obtains or attempts to obtain money or property from the store as a refund or exchange for property that was not paid for and belongs to the store, if the amount of money, or the value of the property, obtained or attempted to be obtained is less than $200.00.
Discussion:
“Retail Fraud” refers to the theft of items that are for sale at a store. There are several different ways in which a person in Michigan can commit Retail Fraud in Michigan. The three basic methods are basic theft (“shoplifting”), “price switching” (which is exactly what it sounds like: switching the price tag from one item to another), or engaging in a “false exchange” (retail fraud by “false exchange” is the crime that is committed when a person tries to return property to a store for a refund or exchange, claiming it was bought there, but knowing that it was not, in fact, bought at that store.) Whether the retail fraud is a first degree, second degree, or third degree depends on a number of factors.
The least serious of these offenses is 3rd Degree Retail Fraud. This occurs when a person commits Retail Fraud through any of the above-listed methods, and the value of the property involved is less than $200.00. Retail Fraud in the 3rd Degree is a misdemeanor with a maximum sentence of 93 days in jail and/or a fine of up to $500.00 or three times the value of the items stolen, whichever is greater.
Retail Fraud in the 2nd Degree involves either the theft of property worth $200 or more, but less than $1,000.00, or theft of any amount of property less than $1,000.00 if the defendant has a prior conviction for Retail Fraud, theft by False Pretenses, or Larceny. Retail Fraud in the 2nd Degree is a misdemeanor with a maximum sentence of one year in jail and/or a fine of $2,000.00 or three times the value of the theft, whichever is greater.
Retail Fraud in the 1st Degree is a felony, with a maximum sentence of five years in prison and/or a fine of $10,000.00 or three times the value of the theft, whichever is greater. For a Retail Fraud to reach this level, it must result in the theft or attempted theft of property worth $1,000.00 or more, or the property must be worth more than $200 and the defendant has a prior conviction for 1st or 2nd Degree Retail Fraud, Larceny, Larceny from a Building, or theft by False Pretenses.
It is important to note that when calculating the value of the property stolen, the calculation is not limited to one specific incident; if a defendant has been engaged in an ongoing scheme of committing retail fraud over a long period of time, the prosecution can aggregate (“add up”) that values of all of the thefts over the course of a year to reach the necessary threshold. Thus, a series of five retail frauds involving $200 or more can be charged as a 1st Degree Retail Fraud.
To convict a defendant, the prosecution must prove all elements of the charge beyond a reasonable doubt. This does not mean all doubt; it simply means all reasonable doubt. The evidence must rule out all other reasonable explanations for what happened.
To convict a defendant of Retail Fraud by theft, the prosecution must prove the following elements: First, the defendant took some property that the store offered for sale. Second, the defendant moved the property (any movement is enough). Third, the defendant must have intended to steal the property, meaning the defendant intended to permanently take the property from the store without the store’s consent. Fourth, this occurred either in the store or in the immediate area surrounding the store while the store was open. For 2nd Degree or 1st Degree Retail Fraud, the prosecution must also prove that the property involved had a value that reached the threshold level (either $200.00 or $1,000.00, depending on the circumstances).
To prove the defendant engaged in price switching, the prosecution must first show that the defendant altered or switched a price tag, or in some other way misrepresented the price of the property. Secondly, they must prove that the defendant did this intending to either pay less than the actual price for the property or not pay for the property at all. Third, they must prove that this occurred while the store was open, either inside the store or in the immediate area surrounding the store. Lastly, the difference between the sales price and the price the defendant intended to pay reached the necessary threshold (either $200.00 or $1,000.00, depending on the degree of Retail Fraud involved).
For a “false exchange” conviction of Retail Fraud, the prosecution must prove that the defendant exchanged or tried to exchange property that had not been paid for and that belonged to the store. (It does not matter if the defendant was trying to exchange the property for money or other property.) They must prove that the defendant did this with the intent to defraud or cheat the store, and they must prove that this happened during store hours, either inside the sore or in the immediate area around the store. Finally, either the amount of money or value of property the defendant obtained or attempted to obtain reached the value necessary to support the charge ($200.00 or $1,000.00, depending on the specific charge).
The most frequent issue at trial for the prosecution is the intent of the defendant. In all three scenarios for Retail Fraud, the prosecution must show the defendant specifically intended to steal, pay less, or defraud the store. For example, if the defendant hid an item because it was a good deal and (s)he intended to come back with more money to purchase it later, and wanted to prevent other customers from purchasing it in the meantime, this would not count as “retail fraud” because there was no intent to defraud the store.
The value of the items is sometimes an issue, as well, especially when the store deals in used goods, or the prosecution is alleging the defendant engaged in multiple thefts over a period of time. In these cases, it is sometimes necessary to bring in an expert who can give an opinion as to the fair market value of used items, or to—in essence—try several smaller Retail Fraud cases during a single trial to establish whether or not the defendant was involved in all of the thefts.
In some instances where a defendant is charged with a 1st Degree or 2nd Degree Retail Fraud, the prosecution will allow a defendant to plea to the next-highest degree (plead a “1st Degree Retail Fraud” down to a “2nd Degree Retail Fraud”, or plead a “2nd Degree Retail Fraud” down to a “3rd Degree Retail Fraud”). Prosecutors often like to resolve these cases to “Attempt Retail Fraud”, which reduces the maximum sentence by half (“Attempt 1st Degree Retail Fraud” has a maximum sentence of 2.5 years, and “Attempt 2nd Degree Retail Fraud” has a maximum sentence of 6 months). Many local jurisdictions also have diversionary programs for first-time offenders charged with 2nd or 3rd Degree Retail Fraud that can result in the case being dismissed without a conviction in exchange for community service and completion of a short term of probation.
For those defendants charged with this crime who fall between the ages of 17 and 24 years old, a deferred sentence program may be available. The Holmes Youthful Trainee Act (“HYTA”; MCL 762.11) allows a judge to defer sentencing until the completion of a probationary period. This probationary period may still require some jail time, community service, classes, drug testing, or other programs assigned by the judge. Upon completion of a successful HYTA probation, the charges will be dismissed. It should be noted that for a court to impose a sentence under HYTA when the defendant is 21 years of age or older, the prosecutor must agree to this disposition.
A defendant convicted under this statute will be sentenced under the Michigan sentencing guidelines, and it is impossible to say for sure what the sentence will be in any particular case because sentences are imposed on a fact-specific basis. While fines and probation are often imposed, many defendants are sentenced to serve time in the county jail or prison.
1Maximum sentence shown is for a first-time felony offender. Prior felonies make a defendant liable for “Habitual Offender” (“HO”) sentencing enhancement. Thus, for a defendant with one prior felony or attempted felony (“HO2”), the maximum sentence raises to 90 months (7.5 years); for a defendant with two prior felonies or attempted felonies (“HO3”), the maximum sentence raises to 120 months (10 years); and a defendant with three or more prior felonies or attempted felonies (“HO4”) faces a maximum sentence of life.
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