The characters are strolling down the street when they hear a minstrel strumming on a mandolin and reciting the tale of a group of adventurers. After a moment, the characters realize that the tale is about one of their exploits, but according to the minstrel the heroes of the song are another group called the "Company of the Leopard."
DM: the Company of the Leopard is an adventuring party located in the city. Their CR is up to the DM. The minstel's name is Arwin Chanter, and he is a second level expert with 5 ranks of perform but no real combat ability. He wears no weapon other than a dagger. Other people on the street will react if Arwin is being bullied; citizens of a city will always side with their own; 1d6+3 commoners will begin telling the party to mind their own business or get beaten up. The watch will be called if the situation turns ugly.
1) the party of the Leopard are a cowardly group, but were hired by the city to wipe out monsters in the vicinity. Rather than actually make the patrols, they have paid the minstrel to sing about them performing deeds they heard about through rumor.
2) The minstrel heard about the deeds, but couldn't find out who did them. He couldn't write a song with no heroes, so he inserted the name of an adventuring party known in the city. He will not want to admit this if he is questioned.
3) A third party is trying to get revenge on the Party of the Leopard by inciting the PC party to attack them. This third party gave the music and lyrics to the minstrel, who gladly accepted the catchy tune as a piece of new music to perform.
The Shady Transaction
A man dressed in brown rags approaches the party in the street.
"Hail and well met, good sirs," he wheedles, ducking his head and looking around furtively.
"You look to be the sort that might be in the market to buy an item of magical power at a very reasonable rate, might you not?"
If the party agrees they might be this sort, he will continue.
"A friend of mine has just such an item for sale, good sirs, a ring. He offers a good commission to an old beggar if I can find him a buyer. He sits in the taproom of the Goose and Feather. Can I take you there to meet with him?"
If the party agrees to go, he will lead them to the tavern. He will insist that he go along: "I must be with you, good sirs, to claim my commission." He will not accept the promise to give the seller his name: "It is not that I distrust you, worthy and powerful sirs, but I distrust my friend, if you take my meaning."
He also will not accept the idea of going later: "I am not the only beggar with this opportunity, good sirs! Please, I beg you, if you are interested come now to give this tired old man the chance of a commission."
In the Goose and Feather, you can choose different options:
1) The friend, Amnee Withers, is a thief of the thieves' guild. He has a ring of protection +1 for sale, and everything is above board in terms of this transaction. The price of the ring is very cheap, since it is stolen. Amnee (not his real name) is not forthcoming about the ring's source. He will insist he got it as an inheritance. The problem for the party is that the ring is the property of a fairly prominent cleric in the city, and he and several others are out and about the streets using divinations and locate object spells to zero in on the ring's location. When they find it, they will attack if they are evil (to get the party's other stuff) or call the law if they are neutral or good.
2) Amnee Withers is a thief, and the ring is stolen as described above. However, Amnee is not a thief of the guild, and the guild is looking for him and any accomplices. They will assume that the party is Amnee's fence, and will seek to dispense guild justice even as the cleric is trying to dispense legal justice.
3) The ring really is an inheritance. Amnee is trying to avoid a small sales tax, and no one will be the wiser if the players walk off with a nice little bargain.
4) If this encounter is used as a result of a "mistaken identity" roll on the random encounter table, the operation is a sting. A party of adventurers loosely fitting the party's description (and the description of a hundred other parties in the city) were almost caught in a fencing operation a week ago by the city guard. There is a bounty being paid to any beggar who successfully brings in a party of this description to the inn if the party agrees to buy a stolen item. In this scenario, Amnee is a convicted thief assisting the city in order to commute his death sentence. He took the ring from a merchant, also working with the guard, who let him remove it from his belt pouch (this may be important for purposes of detecting lies). Amnee has been training for a week to control his surface thoughts. He keeps mentally repeating: "I can sell this stolen ring quick and turn a good profit. Crime does pay." In all, it is a fairly good sting, since the guard know that adventurers can employ magic resources. The guard are surrounding the tavern, but at a safe distance. In this scenario, Amnee is very clear that the ring is stolen.