I think it would be a better mechanic and more engaging from a role playing perspective if looters were less tied to the player character and tied more to the area they were in.
For example, Large groups of looters should only be spawn in war torn or improvised, and/or low loyalty areas, you can leave the small looter spawns at the beginning of the game constant so you don't have to redo the entire balance, plus there will always be crime but they would be small parties so they can out run the authorities. However if a kingdom is peaceful and happy with several it doesn't make sense to have large looter parties and it would reward the player for increasing stability in their territory through governors and defending settlements.
For example, Large groups of looters should only be spawn in war torn or improvised, and/or low loyalty areas, you can leave the small looter spawns at the beginning of the game constant so you don't have to redo the entire balance, plus there will always be crime but they would be small parties so they can out run the authorities. However if a kingdom is peaceful and happy with several it doesn't make sense to have large looter parties and it would reward the player for increasing stability in their territory through governors and defending settlements.