It is easy to do, given the voiceless, faceless character of the Net. Examples abound of people misrepresenting themselves. In one of the more extreme cases, a woman fell in love with a chat companion and got married.
Pedophiles often pretend that they are children to gain the confidence of real children.
While your children obviously need to be aware of what can happen, be careful how you present this concept. Children are naturally free and open with everyone, and you certainly do not want them to have nightmares starring online fiends masquerading as friends. But losing a little innocence regarding their online pen pals is preferable to losing much more. Because people may not be who they say they are, accompany your children to the first real-life meeting of any online acquaintance. To be safe, be sure to have this meeting at a public site.