Lindsay Lohan Charged with Felony Grand Theft: $2,500 Necklace "on Lohan" or Stolen?

(CBS/AP) Prosecutors charged Lindsay Lohan Wednesday with felony grand theft of a $2,500 necklace - a case that could return the troubled starlet to jail rather than the big screen.

Her lawyer, Shawn Chapman Holley, has denied the allegation.

Prosecutors want Superior Court Judge Keith Schwartz to set bail at $20,000, according to the complaint. If convicted, Lohan could face up to three years in state prison.

The charge was the latest - and most serious - legal problem for the actress, who remains on probation in a 2007 drunken driving case.

Police and prosecutors claim Lohan, 24, took the necklace from a store in the beachside community of Venice on Jan. 22, weeks after she was released from a rehab facility where she was accused of misconduct.

The former Disney star has struggled with the terms of her probation, and was sentenced to rehab twice and jail twice last year.

Judge Schwartz will determine if Lohan violated the terms of her probation, which required her to obey all laws and submit to random drug and alcohol testing.

The jewelry case is not Lohan's only concern. Prosecutors in Riverside County are considering whether to charge her with battery for an altercation with a rehab worker at the Betty Ford Center in December.

The threat of incarceration has hung over Lohan since May, when a judge handling her DUI case determined she violated her probation by missing weekly alcohol education classes.

Her three stints in jail in the past three years have all been shortened by overcrowding and the fact that she could not be held without bail on a misdemeanor.

COMPLETE COVERAGE OF LINDSAY LOHAN ON CRIMESIDER