If the other character doesn't have a particularly high profile, just pretend it's someone who has never logged on when you're around, or you never talked to.

"I don't really know Straklaw."

If the other character is high enough profile that you'd be expected to hear of them, maybe just make some generic comment, change the topic, etc. It's not that hard to do this without tipping people off. Immortals have to do it all the time when people mention their immortal character in front of one of their mortals.

valguarnera@carrionfields.com