Like you I’d be very concerned about this situation although I think there’s probably more to it than you’re being told.
As I understand the law, if a person has the capacity to make decisions about their life, then no other person, related or not, can impose decisions on them. Therefore, if your neighbour’s spouse’s family have taken their family member to live in a care home against the spouse’s will, they have broken the law.
In addition, the spouse’s next of kin is your neighbour and your neighbour has the right to be kept informed about what’s happening.
This could therefore be a serious breach of the rights of your neighbour and their spouse and need the intervention of someone like yourself to put things right. Alternatively, there could be other factors involved, of which you’re currently unaware - as I’m sure you know - which might explain the family taking the spouse away.
In these circumstances, I’d be inclined to get your neighbour’s permission to contact social services. Your neighbour is now living alone without their spouse and seems to be a vulnerable person. Social services might be able to offer help for them and keep them safe. At the same time, social services could enquire into the removal of the spouse and investigate this. In their official capacity, they could obtain names and addresses and make official contacts. If social services are unwilling to do this then you might ask the police to carry out a welfare check on the spouse.
I’ve been in a similar situation and also found it difficult to navigate so I understand your concern. I hope you can find a good resolution for your neighbour.