yobeefjerky -Lies-
"...they discovered only a small asteroid inhabited by a solitary old man who claimed repeatedly that nothing was true, though he was later discovered to be lying."
Put simply, no faction should tell the exact truth if it's harmful to themselves. If you've got a character in a meeting with another faction's ambassador, both of you are likely to lie so as to make your repsective factions appear better than they actually are. This actually extends into a larger psychological factor in which your faction should make itself out to be far better than it actually is. The Hegemony does exactly this, making careful use of their ships to make their navy appear much larger and freer than it truly is.
Know the difference between "lying" and "missleading" leave enough hints that they realise they should have seen it comming but didn't, downright lying until it's too late is just rude.