My MIL (DH stepmum - but no contact with real mum so she has always essentially been his mum) has a history of made up stories to cause drama (fake cancer, imaginary stalkers, sending/recieving poison pen letters etc...). She does seem to believe these stories herself and seems to struggle with telling the genuine from the imaginative.
Anyway, recently she told us that our DCs had told her they were being touched by someone and they hate him. We decided not believe this because of her history and because we thought it extremely unlikely (they are never alone with anyone apart from female school teachers, also they havent really been alone with MIL and had any opportunity to confide in her). She has persisted and is now saying awful things in text messages and on the phone - it is all just totally sick and is v upsetting. Also it is now sowing tiny seeds of doubt in my head - am I missing something with my own daughters?
I don't know what to do - tell her to F off? Just say "yes dear" and ignore? Or do I actually need to look into this with my DDs - where do I start with this (they are 4 and 9)?
Or should I actually be calling the authorities on MIL for making up such awful things. Is this verging on her being abusive by trying to make us scared (and starting to succeed)?
It makes me feel sick that if we ignore her she might keep escalating it and get authorities or school involved. Does anyone have any experience of this and can help me stop panicking?