What is the ruling on shunning relatives who cause problems and harm, practice magic, steal property, and spread false rumors, and is it permissible to order one's parents to avoid them? And what is the ruling on these actions of theirs in Islam?

There are two levels in dealing with those who cause harm:

The first (higher) level: Countering harm with goodness and forgiveness, as Allah Almighty says: (And not equal are the good deed and the bad. Repel [evil] by that which is better). This requires great patience and transforms enmity into affection. The Prophet, peace and blessings be upon him, promised that Allah would be a supporter to whoever does so.

The second level: If a person is unable to do that, or fears harm from them, such as magic, it is permissible for him to disassociate from them and abandon them to ward off their harm. For "a beautiful cutting off is better than a harmful association."