It's a natural thing for a 7 year old to steal or lie. What you should do as a parent is teach positive reinforcement. Teach the child what happens to people who steal or lie. (Take them to your local Police Department for a tour). If it's really bad, have an officer come to your home and do a fake arrest. Scaring the child might be a life changing experience. Then it should pass... physical violence isn't the answer but grounding or taking favorite things away? Always works!