First Offense Retail Fraud: Michigan Penalties Explained

Table of Contents

• What Is Retail Fraud in Michigan
• Michigan Retail Fraud Degrees and Penalties
  • First-Degree Retail Fraud
  • Second-Degree Retail Fraud
  • Third-Degree Retail Fraud
• Felony vs. Misdemeanor: How Classification Affects Your Case
• Retail Fraud Diversion Programs and Alternatives to Conviction
• Expungement of Retail Fraud Conviction: Clearing Your Record
• Hiring a Criminal Defense Attorney for Shoplifting and Retail Fraud
• Collateral Consequences Beyond Criminal Penalties
• Frequently Asked Questions

Last Updated: August 12, 2026

What Is Retail Fraud in Michigan

Retail fraud is the unlawful taking of merchandise from a retail establishment with the intent to deprive the merchant of the use or benefit of the item or to avoid paying the purchase price. It encompasses shoplifting, price tag switching, concealment of items, and other deceptive practices designed to obtain goods without proper payment. Michigan law recognizes retail fraud as a serious criminal offense with distinct degrees of severity based on the value of merchandise involved and the offender's intent.

Understanding the specific legal definition matters because it determines how prosecutors will charge you and what penalties you may face. Even a first offense can result in criminal conviction, probation, restitution, and a permanent criminal record that affects employment, housing, and professional licensing. Retail fraud is the statutory crime under Michigan law, while shoplifting is the colloquial term people use. Coppins Law Group, PLLC helps clients facing these charges understand exactly what the prosecution must prove and what defense options exist.

Michigan Retail Fraud Degrees and Penalties

Michigan divides retail fraud into three distinct degrees, each with different elements and penalties based primarily on the value of merchandise involved.

First-Degree Retail Fraud

First-degree retail fraud applies when the value of merchandise exceeds $1,000, or when the offense involves a second or subsequent conviction for any degree of retail fraud within a five-year period. A conviction is a felony with a maximum penalty of imprisonment for up to five years and/or a fine of up to $10,000, plus restitution to the merchant.

A felony conviction appears on your criminal record permanently (unless expunged), affecting employment prospects, housing eligibility, and professional licenses. Sentencing guidelines allow judges discretion, but aggravating factors like planning multiple thefts or involvement with organized theft rings can push sentences toward the higher end of the range. Mitigating factors such as cooperation with authorities, restitution efforts, and stable employment history may support a lower sentence.

Second-Degree Retail Fraud

Second-degree retail fraud involves merchandise valued between $200 and $1,000. This charge can be either a felony or a misdemeanor, depending on the offender's prior record and specific circumstances.

If prosecuted as a felony, the maximum penalty is imprisonment for up to two years and/or a fine of up to $2,000, plus restitution. If charged as a misdemeanor, the maximum penalty is imprisonment for up to 90 days and/or a fine of up to $500, plus restitution. A criminal defense attorney will examine the facts to determine whether the prosecution has overreached in their charging decision and whether a plea to a lower degree is negotiable.

Third-Degree Retail Fraud

Third-degree retail fraud applies to merchandise valued at less than $200 and is always prosecuted as a misdemeanor. The maximum penalty is imprisonment for up to 93 days and/or a fine of up to $500, plus restitution to the merchant. Even as the lowest degree, a third-degree conviction still results in a permanent criminal record affecting employment, housing, and professional opportunities.

Felony vs. Misdemeanor: How Classification Affects Your Case

The distinction between felony and misdemeanor retail fraud charges fundamentally changes how your case proceeds and what consequences you face.

A felony is a crime punishable by imprisonment for more than one year. In Michigan, first-degree retail fraud is always a felony. Second-degree retail fraud can be charged as either a felony or a misdemeanor depending on the defendant's prior record and the prosecutor's discretion.

A misdemeanor is a crime punishable by imprisonment for up to one year or a fine, or both. Third-degree retail fraud is always a misdemeanor.

The procedural differences are substantial. Felony charges require an arraignment before a district judge, followed by a preliminary examination where the prosecution must show probable cause. If probable cause is found, the case is bound over to circuit court for trial. Misdemeanor charges may be handled entirely in district court without a preliminary examination.

Felony convictions carry mandatory consequences that misdemeanors do not, including automatic loss of the right to vote while incarcerated, the right to possess firearms, and eligibility for certain professional licenses. These collateral consequences persist long after you complete your sentence and probation.

Employment consequences differ significantly. Many employers will not hire anyone with a felony conviction, while some may overlook misdemeanor convictions depending on the nature of the job. Professional licenses in healthcare, education, finance, and law enforcement are particularly difficult to obtain or maintain with a felony record.

The statute of limitations also differs. Misdemeanor charges must be brought within one year of the offense, while felony charges can be brought within three years.

Retail Fraud Diversion Programs and Alternatives to Conviction

Michigan recognizes that first-time offenders benefit from rehabilitation rather than traditional criminal conviction. Several diversion programs exist that allow eligible defendants to avoid a permanent criminal conviction.

A diversion program is a structured alternative to traditional prosecution. Rather than going to trial or entering a guilty plea, the defendant agrees to complete specific requirements such as counseling, community service, restitution, and education programs. Upon successful completion, the charges are dismissed and the arrest record may be expunged.

The most common diversion option for retail fraud is a conditional discharge under Michigan law. Under a conditional discharge, the defendant pleads guilty or no contest but the court postpones judgment. If the defendant completes probation and meets all conditions (restitution, counseling, community service), the conviction is set aside and the arrest record can be expunged.

Eligibility for diversion programs depends on several factors. First-time offenders are more likely to qualify than repeat offenders. The value of merchandise involved matters, third-degree and some second-degree cases are more amenable to diversion than first-degree felonies. The defendant's age, employment status, and ties to the community also influence eligibility.

Another alternative is a plea bargain, where the defendant pleads guilty to a lesser charge in exchange for reduced penalties. For example, a second-degree retail fraud charge might be negotiated down to third-degree, or even to a non-theft crime like trespassing. Coppins Law Group, PLLC works with first-time offenders to explore all options before a conviction is entered, potentially avoiding the permanent consequences of a criminal record.

Expungement of Retail Fraud Conviction: Clearing Your Record

If you have been convicted of retail fraud, expungement offers a path to clear your criminal record. An expunged conviction is removed from public access, meaning you can legally answer "no" when asked if you have a criminal record (with limited exceptions for law enforcement and certain professional licensing).

Expungement eligibility depends on the degree of retail fraud and when the conviction occurred. For misdemeanor retail fraud, you may petition for expungement immediately if the conviction was set aside under a conditional discharge. If you were convicted without a conditional discharge, you must wait two years from the date of conviction before petitioning for expungement.

For felony retail fraud, the waiting period is five years from the date of conviction or completion of sentence, whichever is later. The expungement process begins with filing a petition in the district court where you were convicted, including information about the conviction, your conduct since, and reasons why expungement is in the interests of justice. The prosecutor has the opportunity to object.

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The judge considers several factors when deciding whether to grant expungement: the nature of the offense, your age at the time of the offense, your criminal history, your rehabilitation efforts, your employment and community ties, and whether expungement would serve the interests of justice. For retail fraud convictions, judges often consider whether you have made restitution to the victim and whether you have completed counseling or education programs.

A successful expungement petition results in the conviction being removed from your public criminal record. However, law enforcement, courts, and licensing boards for professional positions may still access the expunged record when evaluating your fitness for specific roles.

Hiring a Criminal Defense Attorney for Shoplifting and Retail Fraud

Facing a retail fraud charge is overwhelming and frightening. Hiring a criminal defense attorney who understands Michigan retail fraud law and has experience defending first-time offenders is one of the most important decisions you can make.

A criminal defense attorney evaluates the prosecution's evidence against you and identifies weaknesses in their case. This includes examining how the merchandise was obtained, whether you had intent to deprive the merchant, and whether your rights were properly protected during arrest and questioning. Many retail fraud cases turn on whether the defendant actually intended to steal.

Your attorney negotiates with the prosecutor on your behalf. This may include negotiating for a plea to a lesser charge, advocating for diversion program eligibility, or seeking dismissal if the evidence is insufficient. Prosecutors often have discretion in how they charge and what plea offers they extend.

A defense attorney protects your constitutional rights throughout the process, ensuring you were read your Miranda rights if questioned, that any search was conducted lawfully, and that evidence obtained illegally is excluded from trial. Many defendants inadvertently waive their rights by speaking to police without an attorney present.

Trial preparation is critical if your case goes to trial. Your attorney develops a defense strategy, identifies and prepares witnesses, challenges the prosecution's evidence, and presents your side of the story to a judge or jury.

Coppins Law Group, PLLC provides free initial consultations to discuss your retail fraud charge and explore your legal options. Our team has experience defending first-time offenders and understands the anxiety and uncertainty you're facing. We focus on protecting your rights, reducing legal penalties, and safeguarding your future.

Collateral Consequences Beyond Criminal Penalties

Many people facing retail fraud charges focus on the immediate criminal penalties, jail time, fines, and probation. However, the collateral consequences of a retail fraud conviction often have longer-lasting impact on your life and career.

A criminal conviction appears on background checks conducted by employers. Many employers automatically disqualify candidates with theft-related convictions, regardless of how much time has passed. This is particularly true for positions involving cash handling, inventory management, or access to valuables.

Professional licenses are affected by retail fraud convictions. Teachers, nurses, healthcare workers, accountants, and attorneys must disclose criminal convictions when applying for or renewing licenses. Licensing boards may deny licensure or revoke existing licenses based on retail fraud convictions.

Housing and rental eligibility is compromised by a retail fraud conviction. Landlords conduct background checks and many will not rent to applicants with criminal convictions. Public housing agencies also consider criminal history when determining eligibility.

Educational opportunities may be limited. Some colleges and universities consider criminal history in admissions decisions. Federal student aid may be affected depending on the school's review.

Immigration consequences apply if you are not a U.S. citizen. Retail fraud convictions can trigger deportation proceedings or make you ineligible for citizenship. If you are not a citizen, consulting with an immigration attorney in addition to a criminal defense attorney is essential.

Social stigma persists long after your sentence is complete. A criminal record becomes part of your public identity in the digital age. The psychological burden of this public record can be significant.

These collateral consequences underscore why exploring diversion programs and expungement is so important. Avoiding a permanent conviction or clearing your record through expungement eliminates many of these long-term consequences.

Facing a first offense retail fraud charge in Michigan is serious, but you have options. Understanding the specific degree of the charge, the potential penalties, and the alternative paths forward, including diversion programs and expungement, is essential to protecting your future. The difference between a felony and misdemeanor conviction, the availability of rehabilitation alternatives, and your ability to clear your record all depend on the specific facts of your case and how aggressively you defend against the charges.

Coppins Law Group, PLLC specializes in defending first-time offenders facing retail fraud and shoplifting charges throughout Michigan. Our team understands the fear and uncertainty you're experiencing, and we focus on reducing legal penalties, exploring diversion options, and protecting your long-term future. Contact us today for a free initial consultation to discuss your case and learn what defense strategies may be available to you.