The effect is similar to Aura Steal, stealing 1 active buff from an enemy, though unlike Aura Steal, this will steal an enemy's SP1 (if active).
The prioritization is set to always prioritize the SP ability from a mob if it is active. If not then it seems to prioritise MAB or MDB rather than any useful melee buffs. (11/20/13 Confirm Stole Hundred Fists off VNM T2)
/ja "Larceny" <t>
Since Larceny is a one hour special, some people prefer not to make a macro for it to prevent unintentional activation.