1 - the fact that he initially lied to you about this proves that he knows perfectly well that this is not an ok thing to do.
2 - how do your mutual friends really KNOW that nothing is going on? Be realistic about this - when it really comes down to it, they don't actually know for a fact.
But good for you for ending things. At a minimum, he's an idiot. At the maximum, he's a cheater. Neither are good.