Confabulation - or liar?

[s2sol]

For the last three years, I've worked with a man who I've always believed was an incredible bulstter. However, I've now learned about confabulation, and I believe he may suffer from that. Should I be sympathetic, or call him out on his obvious falsehoods?

As an example, I used to have a job that involved joining ships launching from Fincantiera's shipyard in Venice, and installing stuff while the ship was on sea trials. If we worked like buggery, we could get off at Malaga and fly home. If we didn't, we'd be stuck on the boat until Southampton, which took days longer, and involved the bay of Biscay, which was never any fun. Once, the ship broke down or something in the med, and we had an unexpected couple of days to do the work, and still get off at Malaga.

I told my colleague this story (with much more detail and local colour). About an hour later, I heard him telling the story to a customer as though he'd done the job himself. I was standing next to him, and was so astonished I didn't pull him up on it.

Since then, I've become aware of his fantastic stories, and I'm sure he doesn't know he's lying. Is confabulation a real thing, or should I tell him he's a lying bd?