Hi Wednedsay,
Sorry to hear that your niece has been spreading lies about you. That is a very difficult situation to be in. I hope that things get sorted and that you regain a good relationship with your family with their outmost understanding.
Lying is not a part of the diagnostic criteria for BPD. Not all BPDs are pathological liars and do not lie for the sake of lying but some do and not because of having BPD. Many people lie big and small who are not BPD as you know. People with BPD often believe their lies though. There are many reasons for them to lie but they lie because it benefits them or is a good preference for them. They live in a different reality where they distort facts and circumstances based on their feelings (emotional reasoning) at that present moment. They might lie to gain more approval, attention or validation from others and many other reasons and can do so in the expense of others.
Here is a blog I found about BPD and lying:
www.BPDcentral.com/blog/?Why-Do-Narcissists-and-Borderlines-Lie-So-Much-24Have you told her that she broke your trust? Have you explained the untruth to your family and your concerns and fears to them?
Unfortunately you cannot make someone confess to their lies, and especially if they believe their lies. She would have to admit she was wrong and deal with inner guilt and shame and often that is not something a pwBPD is willing and able to do for you.
How much did the lie impact on your relationship with other family members?
Do you believe she is the only way to get through to your family?
If she is unwilling to fess up, you may have to trust things getting better another way. Having things out in the open without her being the means to fix the untruth said to your family members.
My suggestion is not to react towards what was been smeared and to try to remain calm and explain your side to them. I think that anybody who really cares about you will want to hear your side of things. The family members who care to understand are the ones who are worth it in the end.