You shall not bear false witness against your neighbor.
Exodus 20:16 (ESV}
In the strictest sense this bars perjury. Lying to incriminate the innocent, presumably in a court or justice setting is a terrible act. When one does such a thing, they bring unjust punishment onto the person they bare false witness against. It is despicable and immoral thing to do. But, is this law limited to just that, for the bible also tells us:
There are six things that the Lord hates,
seven that are an abomination to him:
haughty eyes, a lying tongue,
and hands that shed innocent blood,
a heart that devises wicked plans,
feet that make haste to run to evil,
a false witness who breathes out lies,
and one who sows discord among brothers.
Proverbs 6:16-19 (ESV)
In this context, we see false witness is also rumors, gossip, libel and slander. Speaking or writing untrue accounts to damage the good name of person. An attempt to sew the seeds of contempt, mistrust, pain and anger. The Lord also tells us how valueable a good name is:
A good name is to be chosen rather than great riches, and favor is better than silver or gold.
Proverbs 22:1 (ESV)
To take that away from someone with untruths is tantamount to breaking the Eighth Commandment. I'd add that even if the rumor or gossip is true, if your spreading it is told in the wrong spirit, then you're also guilty of violating the spirit of the law, as you did not act lovingly and with forgiveness. What benefit is it to anyone to spread unkind words about another, unless it is in correction or warning? I think we can all learn something from Socrates in this area:
One day the great philosopher came upon an acquaintance who ran up to him excitedly and said, "Socrates, do you know what I just heard about one of your students?"
"Wait a moment," Socrates replied. "Before you tell me I'd like you to pass a little test. It's called the Test of Three."
"Test of Three?"
"That's right," Socrates continued. "Before you talk to me about my student let's take a moment to test what you're going to say. The first test is Truth. Have you made absolutely sure that what you are about to tell me is true?"
No," the man said, "actually I just heard about It."
"All right," said Socrates. "So you don't really know if it's true or not. Now let's try the second test, the test of Goodness. Is what you are about to tell me about my student something good?"
"No, on the contrary..."
"So," Socrates continued, "you want to tell me something bad about him even though you're not certain it's true?"
The man shrugged, a little embarrassed.
Socrates continued. "You may still pass though, b ecause there is a third test - the filter of Usefulness. Is what you want to tell me about my student going to be useful to me?"
"No, not really."
"Well," concluded Socrates, "if what you want to tell me is neither True nor Good nor even Useful, why tell it to me at all?"