Troubled children

I know that I have talked about my oldest 2 kids not liking to be with their father before and I have at times thought that it would be better for our family if they didn't have to go so much, but then I also want them to have a relationship with him, so it has been kind of a catch 22. He use to be a great dad, then we split and he is one of those men that cant be alone and has made some choices that may be good for him but not so good for the kids. He has remarried and now has a step son that is 2 yrs younger than E. From what the kids say this boy has major behavior issues and is the major reason they don't like going to their dads. I have always just let them rant and reassured them that we love them. Well this weekend they came home from a week long stay with dad, and K told us that this boy touches himself in front of them ALL the time. They have told their father and he tells them to ignore him. Now I know that little boys get fascinated with their boy parts, and we have always told E that this is normal and if he need or wants to touch himself it's a private thing not to be done in front of others. I guess K has even looked up to see this boy touching himself and while staring at her and smiling. To write this gives me the creeps. Anyway, I am deeply troubled by this and the kids say it's so bad they don't want to be around him. I know if I say anything to the ex or the new wife they will blow it off and blame my kids. I have talked to a few people I know in the system and have found out that there is really nothing I can do legally because they haven't been physically harmed. It sucks to think that I am going to have to fight to keep them away from this. I have searched my mommy handbook and can't find this chapter anywhere. I am open to suggestions.