Hard to say. If I try to cast my mind back to the time before I knew Arabic, I suppose I thought 'fakir' meant 'yogi, swami, thin person with straggly beard who lies in bed of nails'; but I'm pretty sure I always saw the connexion with 'faker' as just an accident. I didn't at first know 'fakir' was simply faqi:r 'poor', but it was obviously an Oriental word referring to some specific religious class, unrelated to the English word.

I second that, from the standpoint of someone whose Arabic consists of bint, buckshee and a few other words picked up from my father, who served in Egypt in the 30s. The faker sense is simply an error, and while such errors do, of course, sometimes pass into general usage, I'm not persuaded this one has.

could be a misspelling. Fakir is however associated with Faker quite extensively in english literature. The general picture of a fakir is not just someone lieing on a bed of nails, but someone using their bed of nails exhibition to despoil the credulous of their wealth, that the bed of nails and so forth were acts of fakery meant to gull a superstitious native population.

I agree that "fake" is likely to color the English-speaker's understanding of "fakir" (although it's hard to prove it because the concept of humbug is inherent in the term, at least from the point of view of the skeptical Westerner), but that's not at all the same as simply using "fakir" to mean 'faker,' as in the Lynch quote, which does not seem related to the dictionary definition.

Now, LH, that is an example of a different national mentality in choosing loan words.
For this native Russian-speaker "fakir" is not associated with bed of nails ("yog" is), but with magician in pseudo-Indian costume (and in mandatory turban) performing his act on stage (less - on circus arena). Usually a lot of colored smoke involved.
And it's not associated with "faker", rather with "magic".

When I read Lynch's use of "fakir" in reference to MacPherson, I thought it was just a mistake, either a typo or an "eggcorn". But when I checked the OED definition, I found that the OED gives it a sense of "faker" as an Americanism. I don't think that this usage is really current, but from the OED's quotations, and some others that I've found, it does seem that "fakir" was used in the meaning of "dishonest street vendor" in the late 19th and early 20th centuries. The meaning shift from "sleight of hand artist" to "dishonest salesman" seems natural enough, and was doubtless helped along by the phonetic similarity to "faker". If all that is really true...

The alternate spelling "faqir" is very useful to Scrabble players, as an example of a permitted word that has a Q but not a U.

I have seen a turn-of-the-century postcard with the caption "Fakir's Row" at the annual Brockton (Mass.) Fair. I'm sure this was not a row of Hindu holy men but rather more like what Tatyana says: magicians performing their various smoke and mirror acts. And from the photo, they certainly pulled a crowd!

Glad I found this website and everyone's wonderful input on the word "fakir." I made the terrible error of using it in a haiku poem, trusting my memory, that one of the meanings for it was someone who was deceptive! While I see the word has suffered a long journey, some misuse and distortion, at least the meaning of "smoke and mirrors" does exist as it is the meaning I had learned initially. It is good to learn the true origins.
My haiku is based on an old legend of the People of the Dawn, in Eastern North America. A group of this tribe left after a cataclysmic event, went West and settled, then being called the Ojibway. Not so very long ago, some in the East travelled West to visit. The Ojibway welcomed them, saying "We have been waiting for you to come and say that it is safe to return home." Now other kinds of people have arrived in those Eastern lands, offering obscene amounts of money, almost anything to site an LNG terminal on their tribal lands. I thought someone should warn the Ojibway!

haiku for the Ojibway from the People of Passamaquoddy...

Fakirs vend frail dreams.
Unsafe to return to the
Land of our sunrise.