Quote From: hanlukariHi, 
 
My 7 year old daughter took a sparkly rock from her 5 year old cousin's room on Christmas Day. I just found it this morning and she admitted to taking it. Also, yesterday at the bank she took more than one lollipop out of the basket and hid it in her pocketbook after I told her she could only have one. She also took a hundred dollar bill out of my wallet, but admitted to it when I asked her if she had seen it. Then, a few weeks ago, i found some jewelry from my jewelry box in her dresser drawer. She said she and her sister were playing "spy" and had hidden it there.  
 
Anyone have any effective ways to nip this in the bud? She is going to be returning the rock to her cousin and apologizing to her for what she did. WHy do kids do this? 
 
An embarrassed Mom 
You are smart to recognise that you need to know what is causing this behaviour before you can figure out a solution. My daughter went through a stealing stage like that when she was 6. Before I figured it out, I came up with lots of punishments and ways to shame her out of it. They didn't work. She didn't even know herself why she was doing it.
Look at what has been happening in her world and see if you can identify anything that has changed recently. That would be a clue to her problem. In my daughter's case, we had just had her little brother and she was acting out from insecurity. When I figured it out (duh!) I just gave her all kinds of extra attention and she stopped stealing completely.