@Doomer
Because the merchants had built up a good reputation despite swindeling the majority of the population.
If he assasinated them while they still had a good rep he might be acused of killing them, or requested to find out who did it.
If its found out he did it and he killed "good men" for his own benefit the people is going to be unhappy with him.
And if he is requested to find out who did it, he would need to kill a innocent man in his place or say he was unable to find the culprit.
If he is unable to find the culprit, then he himself loses his own reputation for being incompetent.
So he had to ruin the merchant's reputation by playing this charade.
We know the merchants were guilty of much and were by no means good people, but in the eyes of the common folk they were.
So he framed the merchants to make them look bad and thus getting the people to want to kill them.
There is a few benefits to all of this, one being that he himself looks more competent for finding out that the merchants were bad people.
Also he himself was not the one who sentenced them to death.
it was the people he can point to them when/if the other nobles who profited from all of this gets mad at him.
That way he can just blame the people and said he did what they wanted and its going to be much harder for them to find faults with his choices.
And finally if people are happy about the merchants being dead its much less likely that somebody is going to snoop around and potentially find out that he framed them.