Mr. Dunn has an excellent point. Once the police are involved STOP TALKING to them or about the case until you have consulted and hired a lawyer. The police will put words in your mouth and twist them about.

thanks I appreciate your advice. However, how is it right that the teacher can get away with filing a false statement to the police and my sister can not make him accountable for that?

I agree. It is not right and false statements causing criminal charges should be punished. But that is something an attorney should help address AFTER your sister focuses on the more important issues of the child's present and future interests. Try not to react while you are still, though understandably, angry or upset. Try to stay focused on the child’s present circumstance and how it will affect her now and in the future, and then address any trouble with the school.

Thank you Mr. Dunn, I will take your advice and speak to the lawyer about it and see how they are going to handle it. I appreciate all your advice :)