Crook Steven Norman was apprehended by a group of 20 bikers who were out selling poppies in Stafford town centre on Saturday.
Norman has now been fined after admitting attempted theft.
Veteran Martin Burrows was selling poppies alongside the biker group, Oxleather MCC, and filmed the altercation on his phone as it unfolded.
WATCH the footage here:
He said: "The lad we were holding decided to try and pick the pocket of an elderly gentleman in Stafford.
"This elderly gent, he's a veteran and does a lot for the poppy appeal. He's over 80. This thief picked the wrong place, the wrong time and the wrong people."
Ex-serviceman Mr Burrows, aged 54, said he heard someone shout "stop, thief" and saw the crook run "straight into the arms" of one of the bikers in Market Square.
One of the men held him in a headlock until the police arrived.
The video was posted live on Facebook and has since been viewed more than 104,000 times, with many praising the actions of the motorcyclists.
The thief can be seen kicking out at Mr Burrows, who was filming, until two more men join in to hold him down.
Mr Burrows, who used to be a driver for No 2 Mechanical Transport Squadron (2MT) in Stafford, added: "He was threatening me, saying he was going to kill me.
"The reason I videoed it was to protect the guys holding him.
"You have to be desperate to try and pick the pocket of a veteran though. So somebody really has to have a look at what is going on in Stafford. I hope this can highlight the problem we have."
A Staffordshire Police spokesman said: "We'd like to update our local community regarding an incident that took place in Stafford town centre whereby an attempted theft was witnessed by members of the public who intervened.
"Steven Norman, 43, was charged with attempted theft and remanded in police custody. He appeared at magistrates court on Monday morning.
"We're grateful to all who assisted with the investigation. "
Norman, of Friars Terrace in Stafford, was fined £250 after pleading guilty to attempted theft.