Do I Have to Pay a Civil Penalty if I’m Arrested for Shoplifting?

Many people who were arrested and charged with shoplifting at retail stores like Walmart, Dillards, or Kohls then receive a letter in the mail demanding payment to the store of a “civil penalty.”

They are understandably confused – what is a civil penalty? Do you have to pay it? Is it connected to the criminal charges somehow? Why is the store demanding payment for more than the value of the items alleged to be stolen?

What happens if I don’t pay?

What does SC law say about these letters, and can it be used to your advantage?

What Does SC Law Say About Civil Penalties for Shoplifting?

SC Code Section 15-75-40 says that a person who commits shoplifting is liable to the store for:

  1. The retail price of the merchandise (if it is not recovered in good condition) up to $1500; and
  2. A civil penalty that can be as much as three times the value of the merchandise but no more than $500.

This SC law authorizes stores to demand payment from you in a letter sent by certified mail in the following format:

This letter is written notice of demand for payment of damages in the amount of (amount of damages) arising out of your shoplifting of the following personal property owned by (the undersigned or other owner): (list of property)

Pursuant to Section 15-75-40, Code of Laws of South Carolina, 1976, this letter is further notice that if the amount stated above is not paid, or a written agreement as to its payment is not reached within thirty days of the date of mailing this letter, (I) (we) (other owner) intend to bring a legal action against you for the amount, plus attorney’s fees, court costs, and other relief provided by law. (Name) (Address of business) (City) (person sending notice)

Many of the larger retailers, like Walmart, have used this extensively to demand money from people who are charged with shoplifting, even when they are not guilty of the charges.

What Happens if They Send a Demand Letter, but You are Not Guilty?

Section 15-75-40(E) says:

A conviction or a plea of guilty for committing shoplifting is not a prerequisite to the bringing of a civil suit, obtaining a judgment, or collecting that judgment under this section.

Which means that the store does not have to wait until you are convicted before demanding payment from you – once you have been accused of shoplifting, they have the green light to send a demand letter.

As a matter of fact, they don’t care if you are guilty – as far as we know, the companies don’t have a process for determining whether a person actually committed the crime – a Walmart employee said you did it and you were arrested, therefore you should pay up…

A recent NY Times article highlights the stories of shoplifting defendants who were wrongfully arrested and then harassed with demand letters sent from law firms on the behalf of the companies, and points out that these companies send tens of thousands of these letters each year:

Walmart and other companies have created well-oiled operations, hiring law firms to send tens of thousands of letters a year. Walmart set a collection goal of about $6 million in 2016 for one of its go-to firms, Palmer Reifler & Associates, according to a court paper filed as part of a lawsuit Ms. Thompson brought against the retailer. The firm also pointed out to Walmart that minors tended to pay off more frequently, the filing said.

What if You Pay the Demand Letter Before You are Convicted?

The only silver lining for someone accused of shoplifting may be SC Code Section 15-75-40(L), which says:

A store which utilizes the provisions of this section is prohibited from subsequently filing criminal charges against the individual pursuant to Section 16-13-110.

SC Code Section 16-13-110 is SC’s shoplifting statute.

Although I am not aware of any SC appellate opinion on this issue, the language of the statute seems clear that when a store demands payment under 15-75-40, and the alleged shoplifter pays it, they cannot also be prosecuted criminally for shoplifting

Which means that, if you have been charged with shoplifting and you do not want a prolonged legal fight in criminal court and a series of harassing letters that might, but probably will not, end in a lawsuit against you, you should pay the demand.

Let your SC shoplifting defense attorney help you with the process – send the payment to the law firm or other location indicated in the letter, send it by certified mail, make the payment with a money order and keep the payment stub, and document every step of the process.

Be aware that a magistrate court or municipal prosecutor may not immediately dismiss your case based upon payment – they might not be aware of the language in the statute or they might insist that your attorney argue a motion to dismiss to the court.

Why Do We Have Statutes Allowing Retailers to Demand Payment from Shoplifters?

We have statutes that allow retailers to demand money from alleged shoplifters because corporations have lobbied state legislatures for decades to get similar laws passed.

Shoplifting is a huge problem for many retailers – costing as much as $17 billion each year. Many retailers, like Walmart, have become extremely aggressive in attempting to stop shoplifters or recover losses from them, resulting in wrongful arrests, assaults by Walmart employees on customers, and demands for civil penalties.

Does it Work to Deter Shoplifters?

According to the NY Times article above, the retail industry’s arguments to state legislatures as they lobbied for passage of these laws was that it would deter shoplifting, that shoplifting was widespread, and that the costs of shoplifting resulted in rising prices for consumers.

Despite this, there is no evidence that civil penalty laws have had any effect on shoplifting nationwide:

“There is no evidence that these laws have decreased shoplifting or decriminalized petty crime at all,” said Ryan Sullivan, an assistant professor at the Nebraska College of Law who studies the impact of shoplifting laws.

Efforts in some states to revise or repeal the civil penalty laws have had little or no effect. In Maryland, for example, the state now requires retailers to report the number of letters they send, but retailers are refusing to comply. In Illinois, an attempt to reduce the amount of the penalties was met with stiff resistance by industry lobbyists and the legislation did not pass:

In Illinois, a 2015 proposal to reduce the penalties that retailers can demand from shoplifting suspects died in the legislature. One of the bill’s sponsors said an industry lobbyist had warned him that the issue was a “third rail” among retailers with deep political influence in the state.

Doesn’t it Encourage Stores to Make Shoplifting Arrests?

That’s something to consider, isn’t it?

Each time a store makes an allegation of shoplifting, the customer’s information is sent to the store’s attorneys, who then begin sending demand letters that threaten a lawsuit if the customer does not pay them hundreds of dollars…

Are millions of dollars each year enough motivation to aggressively prosecute (or aggressively make accusations of, rather) shoplifting?

Can I Sue Walmart or Other Retailers for Wrongful Arrest?

If you were arrested for a bogus shoplifting charge at Walmart, Kohl’s, Dillards, JC Penney, or any other retailer, you may be able to sue them for wrongful arrest, malicious prosecution, assault and battery, or even a Section 1983 civil rights claim for denying your constitutional rights in concert with law enforcement.

Criminal Defense Lawyer in Charleston, SC

Arrested for shoplifting?

Charleston criminal defense attorney Grant B. Smaldone will get your case dismissed, find the best possible outcome, or try your case to a jury. Although your criminal charges usually must be resolved before you can file suit against the store or police for wrongful arrest, we will preserve any evidence that you will need for a civil suit and advise you as to whether you have a civil claim.

Call Charleston shoplifting defense lawyer Grant B. Smaldone now at (843) 808-2100 or send us a message to speak with a SC shoplifting defense attorney today.