I think the guys name is Bandon, but at the City Gates, a guy that looks like a shadow thief talks to a guard and sells him some spices. When you talk to the guard and tell him you overheard him talking, he says its none of your business. Does this turn into a quest?

Hmm... I've wondered about that too... haven't seen any evidence of it being a quest though... then again can't really be sure... *shrug* So, in other words, no idea... *grin*

I have played that so many ways looking to find a quest, with no possible action passed by, including killing all those involved ;) but to no avail :(
It appears to be nothing more than a teaser

ok! Thanks!

It is just to show you the mood of the city. There is a lot of bribery in the city.

There are a few other mood encounter like that in the game. Once in the slum you will see a slaver with a slave. In the drow city you will also see a drow kill a slave and his matron killing him. You will also see a fleeing elf.