Financial abuse, what can be done?

At such a loss of what to do. My MIL lives with her daughter. After a fall, they made the decision she would move into the daughter's house. She would turn over about $900 a month towared the household expenses. The SIL has a long history of financial mismangement and bankruptcies. Her mom's house was sold, the money went into an account. The SIL is power of attorney. We come to find out in a 7 month period $60,000 was taken out. This was mostly in cash through ATM machine withdrawls a couple times a week. We have all the records and documentation. I contacted an attorney. He said is it drugs or gambling? We still have no idea where all that money went. We were able to put a freeze on her access. Now, the MIL forgives the daughter. She wants access back to the account. We keep explaining she may need that money for nursing home or skilled care in the home. She has fallen another two times. She's really too old to explain that medicare looks back and the SIL is suggesting that her brother has alterior motives for the money. We do not want to call protective services. The mom just called for money. He asked the sister for receipts which are not being provided. He transferred $1500 into the moms checking. What can be done? If we were to release that money we know it would be spent then the SIL would claim she could no longer take care of her mom and it would limit his mom's options. It's causing a real severe rift. Any advice? As long as we have the documentation, can we not be held responsible from medicare lookback?