Need perspectives from hiring managers

You interview a candidate and they seem to be great at what they do. They also might be a good addition to the team and organisation.

However, you know beforehand (through some source) that this candidate has been laid off from their current role and is serving notice period. The candidate during the interview refuses to admit that they have been laid off but tells that they have resigned on their own.

Would you still trust this candidate and go ahead hiring them only on basis of merit, or would you focus on building a team that is transparent and open?

Thoughts please.