Making him return it, look them in the face and dealing with the consequences is a good start.
Call the mom before hand and ask her to tell him that 'she's very disappointed" in him and that he can't return for a while.
All theft should be dealt with by hulk smash.
I forgot a boy gave my first grader a dollar last fall and she had to return it as well. It's not hers, she didn't steal, but right is right.
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