I would suggest that you get the full story about what happened from the ex MIL and as james suggested then sit down and talk to your little boy. There are always 2 sides to every story!
It is pretty unreasonable even if something did happen(not suggesting your little boy did anything) that he then be labelled so as to be a risk to ex hubbies daughters. Sounds a little like bitter tension could be clouding reality here.
You stick to your guns regardless and be strong and supportive for your boy. I wouldn't put him any situation from now on that may leave him with the ex MIL!
Best of luck