Man, lots of you are more screwed up than I'd thought. He who is without sin cast the first stone.

Do you know if he said he was a U.S. citizen or if he just claimed he was some kind of legal resident? Falsely claiming U.S. citizenship would bar him from any immigration relief under current law (I don't think so on CIR, but you never know...). Falsely claiming legal residence is not a direct bar under federal immigration law, now or ever. It is, however, a legal problem nonetheless (depending on whether he applied for state or federal benefits), which can then turn into problems for immigration stuff.

Long story short? Lawyer lawyer lawyer...

Quick note: If he hasn't actually received anything, he could try to write it off as a misunderstanding. But again, lawyer lawyer lawyer because these laws aren't easy--and the state/feds wield a ton of discretionary power.