Just how little space was there on the form? I think I would have tried something like:

"When I was 12 years old, I exchanged encrypted messages with friends. The FBI found a code and briefly thought I was a spy."

Or, if there was even less space:

“As child, used encryption for fun. FBI found code & investigated.”

I would want to avoid lying at all costs, even if a superior instructed me to. Who knows what could happen.