Just spent 15 minutes becoming an expert on anything based of Social Issues. Don't worry, I'm an expert.
Maybe he originally came here and was mocked, because I know I was. Came here way too long ago before I knew anything, was a mere child. Stupid post's, bad grammar, easy question's of the such got me mocked. This more often then it should lead's to people lying. Anyone does it, and it is bad, but it happens. As you said, you believed him at first, which means this gives him a sense of self-esteem, while avoiding any any type of embarrassment, but on top of this, since you believed him, now that he feels good, that makes it even harder for him to give up the idea of lying. If I go out and say, "Hey! I'm Barack Obama, President of the United States of America!", no one would believe me, which would put me in the mindset that I cannot get away with such lies, and the embarrassment from said lie would be greater then telling le truth. But since you believed him, this put him in a sense of self-worth, power, and raised self-esteem, and due to this, would continue his lying progress.
Maybe he also did it for 'Face-saving', which is doing something to get public respect. He might have gotten it at first, and had gotten addicted to it. And if it came to a point where he no longer got the respect he wanted, he escalated his lies to the next level. Almost Saiyan level.
He could also have been self-conscious. Thinking, "Hey, I suck butt. No way they can like me." This can always lead to a multitude of lies. Trying to make himself out to be what everyone wants, so everyone likes him.
Another reason would be to just get perk's on RZ. Maybe he thought by lying about his life and saying all these things could get him some rank or something of the sort.
Or hes a douche, either way, fair game mate.