I would pull him aside and let him know that people are suspecting something is up and are talking. I would let him know that if he's not careful someone is going to spill the beans. Then I would back out. Something similar happened to me. My first wife cheated on me. I saw all the signs and chose to not believe it. When I confronted my friends, there advise was to pay attention to the signs. When I confronted her, she admitted the truth.
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