Crime and Punishment

The The Eternal Empire has constructed a vast legal code to establish standard restitution for every imaginable civil or criminal offense. Most penalties are monetary in nature, with punishment reserved for crimes against the empire. Those without the means to pay are indentured to the wronged party for a term deemed suitable to pay off the debt plus interest.
For the most part, citizens are expected to settle disputes among themselves according to custom. If a settlement can't be reached, they can petition an Imperial Magistrate to hear the case and render a judgement, but they must pay for the privilege. The magistrate's fee must be paid by the claimant when bringing the case, but is added to the amount of the judgement if the claim is found valid. Since the only real advantage to bringing a case before a magistrate is imperial enforcement of the penalty--failure to comply with a magistrate's judgement is a crime of insubordination against the Empress--this option is really only worthwhile if the claimant is wealthy or the likely settlement amount is large. For smaller disputes, citizens with a disagreement either work something out or agree to abide by the decision of some mutually agreed-upon third party.
Bringing a disagreement before a magistrate or some other neutral party works well enough for civil disputes, when two citizens disagree about the terms of a contract or the ownership of a pig, but isn't a viable route to justice for crime victims. Even if the identity of the criminal is known, they probably won't agree to appear before a magistrate. Since the Imperial Inquisitors are only concerned with crimes against the empire, most cities of the empire rely on a local guard or militia to deal with crimes against the citizenry, but Khezvaros ceded their right to field such a force under the terms of the Grain Rot Pact. The wealthy could afford to hire armed guards to protect them from criminals (provided the weren't forbidden to do so by order of the Peace Tribunals), but the less fortunate were left to fend for themselves.
As is practically tradition in Khezvaros, the city's criminal element saw a need and moved quickly to profit from it. Many of the city's criminal organizations had long profited from protection rackets, but these arrangements mutated when the guard was disbanded. Those who couldn't afford to pay for protection were still left to the wolves initially, but over time the gangs' territoriality and community ties made protecting the most vulnerable members of their territory a point of pride. Today, many of these groups function more like a community-funded militia than an extortion operation. Most continue to engage in criminal activities, but prey primarily on people outside of their territory. On their home turf, they restrict their criminal activities to things like drug dealing and loan sharking, which they see as providing a service. 
Crimes against the empire are investigated and prosecuted by the Imperial Inquisitors. While some crimes against the empire carry penalties of punishment (maiming, exile, etc.) or death, most carry fines just like crimes against citizens, and those who can't pay are sentenced to a term of indenture to an imperial representative or institution. Those who are unable to pay the penalty for relatively minor crimes are often sentenced to a term in the cages along the road to The Tower of Daggers. Otherwise, imprisonment is generally reserved for those who can't be sentenced to the usual penalty for political reasons.
Common crimes against the empire include:

• Theft or damage of imperial property
• Assault on imperial personnel or nobility
• Any crime committed against certain high-ranking imperial officers
• Treason and sedition
• Tax Evasion and Smuggling*
• Disturbing the Peace**
• Failure to comply with an imperial order or decree
• Arson

*Prohibition of the sale of certain goods in the empire is very rare and usually a temporary response to a specific political situation. For example, the sale of weapons might be prohibited during times of civil unrest or the empire may place an embargo on goods from a foreign nation that it wants to put pressure on. Therefore, most smuggling is carried out for the purposes of tax avoidance.
**Whether a particular action constitutes a disruption of the peace varies wildly and often depends on whether any imperial officers in the vicinity find it annoying or entertaining. If imperial guards encounter a fight while on patrol, they're just as likely to place bets on the outcome as break it up and drag the perpetrators to a magistrate for sentencing.