If the party committed a crime and guards have been called on the party, it's possible to cast Feign Death on the party member who committed the crime to avoid being interrogated. The guards will generally leave before the spell runs out, and the party can keep all the stolen goods.
Depending on the severity of the crime, the other party members might be interrogated as well and might need to roll a Charisma Check, so it's better used for petty stuff like pickpocketing or for more severe stuff if the other party members are nowhere near.
Prior to Patch 7, Applying Feign Death on an allied NPC (denoted by a green outline when moused-over) was not considered a hostile action and would not offend the target or nearby NPCs. Moreover, Stealing from an NPC under the effect of Feign Death did not trigger hostility, provided no other NPCs witnessed the crime and the target NPC did not notice anything had been stolen upon waking. Failing a pickpocket attempt, however, would terminate the current pickpocketing session, which could not be resumed until the next turn, yet not wake the NPC. This was particularly effective when used on Traders. However, with the application of Patch 7, NPCs can no longer be targeted by this spell.
Psychic. Disease and Poison no longer have any effect.
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Action + 
Level 3 Spell Slot
Melee: 1.5 m / 5 ft
Duration: 10 turns 
Feign death on the Forgotten Realms Wiki