That is always difficult.

I've known adults who do the same thing and no matter what you come up with to try and let them know you see past their story, they will always have some addtional story to counter with. Basically people do it so they are the center of attention or try to make themselves such. I think that in the case of the boy you refer to the only thing you can do is to continually remind him of the difference between the truth and a lie. Obviously he feels less then accepted and tries to make himself the center of attention. Lack of attention is obvious as you describe his situation and perhaps the amount of time you spend with him will help some. FB Drive like hell; you'll get there.