As the DM you are in the best position to stop this behavior with a number of options.
- The first possibility is to talk to the problem player privately and politely. If it is just you and him, then he'll most likely be less defensive. The key to this is that you must be calm and rational and to be honest. In his case, I would, near the end of our talk, tell him that if the problem continues, you'll have to ask him to leave the game. This is a talk, not a negotiation.
- Killing off the character (not the player, though that might be tempting). I generally consider this to be a bad idea, unless this come out organically from the character's actions. If the player had a chance to mess with a powerful NPC, he might. This NPC might not be as nice as the PC's.
- Ask the other players (without the problem player there) what they would do if an NPC did these actions? Tell them that they are allowed to handle this situation.
- Finally, kick the player out of your group. Try to do this politely, and explain why you're doing this. He should know this because of your private talk earlier.
- You can always explain to your players (all together) that their
behavior is unacceptable and that you cannot remain in the game
because it is no longer fun for you. I've only done this once. I
didn't play any role-playing games for a couple of years.
I try to explain to new players, typically as the first meeting, what sort of behavior I find unacceptable. I basically explain I want the PC's to be heroes because I play the villains.
I have been GM'ing, on and off, for about 40 years. I started with the three-book set that was more miniatures combat than role-playing.
I have had to use each of these steps at one time or another. I hate to escalate past #1, and that is normally all that I've needed. However there are toxic players and they can destroy a gaming group.
The one time I went to #2, the character had killed off some townsfolk in a science-fiction game. And the character did this highly visibly. He was given a trial with the other characters as witnesses, and sentenced to die. So I devoted an entire adventure to a supernatural/horror that I based on a story that I would have sworn was "The Hell Bound Train", but wasn't. It was a similar story. It went over very well with the players, even the one playing the bad character. He reformed and was a part of a few campaigns after that.
Item 3 I've done a couple of times also, but for less serious problems. If one character was bothering the others, a quick reminder that they might not tolerate this behavior in an NPC is often enough to get the characters to stand up to the annoying one.
Item 4 I've only done once. I was mature enough to do this politely and with a calm tone.
Item 5 I've also done only once, and that in a multi-gm game. I thought that the game would continue without me, but it died.