Diarmid is one of the mercenaries hired by Sarevok to kill Gorion's Ward and their party.

He is encountered in the caves at the end of the Candlekeep Catacombs, near the exit.  He does not initially recognise you, believing the party to be another group of assassins, and thus can be freely questioned for information.  Alternatively, you can tell him who you are.  Regardless of the dialogue options chosen, he will try to leave immediately after the conversation ends.