The Office Gossip

There is a woman in our office who loves to gossip. She basically pumps people for information or overhears conversations, and then she twists their stories into a million contorted exaggerations of the truth. She even pits people against each other. She has become very distracting and she is lessening productivity in the office. Some people don't engage with her at all, but there are still plenty that do. How do you deal with someone like this??????