@CinnamonSwirl82 , back in 2019 I wrote a post almost EXACTLY like this. The ONLY difference was that my abuser was from the US and was pretending to be a US Marine. They call it Stolen Valor and it's taken extremely seriously over there. I also found out through his mother, who he also told me not to talk to about it because it was too traumatizing for him to discuss with them and too upsetting for his Mom to think about.
This pathetic creature had shown me pictures of "him" in Afghanastan (really blurry, pointed out his friend who ACTUALLY was in the USMC), medals he had received (bought online), his "uniform" (bought online). He went into extremely graphic detail about killing men, women, children. He had even faked discharge papers. As someone from the UK, I don't even know what UK discharge papers look like never mind USMC papers. Looking back it was so obvious it was all lies.
So my advice, having been exactly there, is this. Firstly, make absolutely sure you have 999 on speed dial and make sure your MIL knows when you are about to confront him. He won't be violent until he is and men like this can lash out when cornered in their lies. I would even maybe have MIL there with you. If not Make a plan to text your MIL after half an hour, then half an hour after that so she knows you are ok. She should also be on hand to present the evidence if you don't have it in text form as without it he will likely keep trying to wiggle his way out of it.
When you are ready and he is home do not to beat around the bush with "I know" or "Do you have something to tell me?", or any other vague BS. Don't make it a game. Confront him directly. "I know you weren't in the Army". Present him the evidence. Give him no opportunity to drag it out. Despite this, he will try. It's a manipulation tactic so he can regain control of the situation, to make you feel sorry for him and to make you doubt yourself, and he may try to do so using the following excuses.
He was stressed and having a hard time at the time he told the lie. He didn't think your relationship would become more than a fling when he told the lie so he thought he would never have to worry about it. Then, when you did become more serious he felt he couldn't admit his lies to you. He will blame his lies on childhood trauma, not being able to join the military because of XYZ problem, he was stressed and wanted to live a fantasy life for a while, thinking it wouldn't harm anyone. He is fucked in the head and needs help which is why he made up vulgar tales of kids being slaughtered.
I wouldn't get into it any further than that with him. Stonewall any more excuses. You don't want or need to hear it and there is no point in hashing out why he lied about killing women and children or whatever other fake trauma stories he told you, because there is no explanation or excuse good enough to make any of it make sense.
At this point you set out what is going to happen. You are the one in control here, not him. "I want to stay but you get therapy". "I want you to leave and we are getting divorced". "Go and stay with your mother/friend/wherever while I get my head around this". Whatever you decide to do you set it out right there and then. Don't give him hope because that allows him a space to manipulate you again. If you are kicking him out follow through with it, have a bag packed and ready. I made the mistake of staying. It may not seem as simple as just leaving him, but I would strongly advise not wasting time trying to change a liar and manipulator. That's 2 years I won't get back trying o fight the inevitable after catching him in another lie (liver failure), on top of the 3 wasted years believing he was a veteran. You cannot fix him and it will be extremely hard to make this work and to trust him afterwards.
Next, and this is the absolutely most important part, is for you to get some real practical help. Despite my abusers stories of murdering innocents being fake, his PTSD episodes etc, it all left me very traumatized and eventually I was diagnosed with PTSD. GET THERAPY NOW. Do not wait. Do not try and do this on your own. Do not try and make sense of it with his help because he is too close to the situation. He IS the situation. You need to work through your own feelings on this with he help of a pro, separate from him and separate from his family. The lie itself is a big enough betrayal but the context can and will leave you mentally tortured going over and over and over it all. Also, as much as your MIL is supporting you now don't rely on it. They will always ultimately side with their baby boy.
Stay strong, and stay safe OP. Don't fall for more lies, manipulation, begging, crying, pleading or intimidation. If you want to DM someone who has been there please feel free to send me a message. I can give advise or just be a listening ear.
ETA: Record record record and record every conversation, too. Regardless of the outcome he will twist the story and if it comes to divorce you need all the evidence you can get.