Reporting from San Diego - Even by the confessional standards of the "Dr. Phil" television show, it was a whopper of an admission.

The nicely dressed couple said they had roamed several states as shoplifters, stealing mostly toys, selling them on the Internet and making as much as $1 million over seven years.

"I'm no lawyer or a cop," said talk-show host Phil McGraw, his Texas drawl mixed with incredulity, "but isn't that a federal crime?"

The wife paused a second and then said, "Yeah, it is."

Last week, a federal grand jury in San Diego agreed, handing down an indictment against Matthew Allen Eaton, 34, and his wife, Laura, 26. And, just as Dr. Phil predicted, the transcript and video of last November's show are central to the prosecution's case.

The indictment, for moving stolen goods across state lines, says the Eatons sold more than $100,000 using EBay and PayPal over a 12-month period -- a crime that prosecutors call "e-fencing."

More than 500 boxes of toys and other things were carted off when investigators from the San Diego Regional Fraud Task Force raided the couple's home in suburban San Marcos.

The Eatons had approached the "Dr. Phil" show with the offer to tell their story. They answered all his questions politely and with only slight hesitation. They even provided a home video of an out-of-state road trip -- the indictment suggests it was to Arizona and Texas -- in which they smoothly ripped off several stores with their three young children in tow and mailed the goods back home.

The toddlers, they said on the video, are good decoys.

"Sometimes we just kind of go in together as a nice little family to make it seem like we're normal people, and we don't look like the kind of people that steal," Matthew Eaton said. "We have our kids with us, and they usually always buy it."

Laura Eaton provided a typical inventory of the loot. Sometimes they would stuff goodies into their pockets; other times they would boldly walk out of stores.

"We steal diapers, wipes, shoes, socks, clothes, food," she said on the video. "This scanner, desk, the lamp, swords, filing cabinet, TV, this computer, trash can, cabinets, movies, paper shredder."

Dr. Phil is not the only person who was surprised at what the Eatons told him and a television audience of about 5 million.

"In 20 years of fraud cases, I've never seen anything like this: a taped confession before a national audience," said Secret Service agent Greg Meyer, who worked on the case.

Paul Pfingst, a former two-term San Diego County district attorney and now a high-profile defense attorney, said, "In the hall of fame of dumb crooks, these people will have a prominent position."

The arraignment judge, U.S. Magistrate Ruben Brooks, ordered the couple to undergo mental health counseling as a condition of bail.

By the time the couple chatted with Dr. Phil, they knew that the San Diego County Sheriff's Department was already investigating them for shoplifting a toy from a Target store in Vista, a possible misdemeanor. The show propelled the investigation and brought in the feds.

So why did they go on television? Matthew Eaton told Dr. Phil that he and his wife felt gripped by a shoplifting compulsion and that only by blowing their own cover did they think they could stop.

"Putting it out in the open and knowing that everybody's seen us now," he said, "it'll help us to not want to go to the stores because we're going to feel like they're going to recognize us now. And I think it's something to help us stop."

The couple say they are kleptomaniacs, which Dr. Phil, who has a doctorate in clinical psychology, suggested is baloney because he said kleptomaniacs steal for thrill, not profit.

On camera, the couple were matter-of-fact; not remorseful but not boastful, although they admitted the spree was "a little fun." Matthew Eaton said he had thought about stepping up to a more serious crime.

"I've thought of going into a bank and just getting one teller's money and getting in and getting out," he said. "But there's no way I could really do something like that. It's just too dangerous."

Laura Eaton said the couple had dreams of using the profits to start a legitimate toy business. Now they are indigent and could face five years in prison. Their children -- ages 4, 2 and 1 -- were placed with relatives after the couple were arrested.

Matthew Eaton's employment record is checkered. He has worked as a security guard and a supervisor at a gas station. An auto-detailing business he founded flopped, leading him to file for personal bankruptcy in 2000 to try to shed personal debts and a bill from the Internal Revenue Service.

The Eatons moved to Las Vegas in 2007, but within months had moved back to San Diego County.

Some minimal attempts were made to shield their identities on "Dr. Phil." They were referred to only by their last names. No references were made to San Diego or its suburbs.

When the fraud task force cranked up its investigation in recent months, an attorney representing the couple complained that a "Dr. Phil" producer had tricked the couple by promising psychological help and, if they were indicted, bail money and a legal defense fund -- assertions the show denies.

Only one toy is mentioned in the indictment, a Lego Star Wars Millennium Falcon, allegedly stolen from the Target store in Vista, a crime that initially brought the Eatons to the attention of sheriff's detectives.

In court, lawyers for Matthew and Laura Eaton said the couple had long suffered from depression. As the investigation closed in, each found legitimate employment: Matthew as an auto detailer; Laura as a home-care helper for the disabled, their attorneys told the magistrate at arraignment.

Nothing in the indictment or other court documents suggests that the government will try to get Dr. Phil to testify.

On Monday, the couple pleaded not guilty. The magistrate set bail for Matthew Eaton at $35,000; for Laura Eaton at $25,000. She was bailed out quickly, with the help of family members. On Friday, her husband remained in the federal lockup in downtown San Diego.

Each has a lawyer appointed by the court and paid with public funds. Neither lawyer would comment after a brief court session Thursday.

On the show, Dr. Phil had warned the Eatons to quit their life of crime.

"You better stop this, and you better stop it right now," he said, "because they're going to burn you down . . . I'm not just picking on you; I'm trying to help."

It appears his advice was in vain. Four months later, the indictment alleges, the Eatons were still stealing.