This is a ‘machla’ and has to be stopped.
Some people due to their own personality problems don’t realize that making up baloney stories and saying it with a straight face isn’t appropriate. Whoever sits idly by and listens to someone publicly embarassing a chassan, saying complete motzei shem rah just for the sake of getting a laugh has a part of the blame for egging him on.
I have been at simchas where the ‘entertainer/speaker’ was hocked up by someone in the audience who knew that the story being repeated was a bold faced lie and can cause untold harm. Minimally, walk out in disgust until the rashah stops speaking.