Concerned about My Niece: Have to Make a Hard Decision

As a preface, my older sister is a sex worker/prostitute/escort and let's her male (platonic) friends crash on her couch.Over the last two years, my niece has been acting out inappropriately at school (lying flat on her back and putting her legs in the air, taking inappropriate pictures on a school camera, etc.). Within this past week, my niece (who is 10) let her male classmate grope her chest and let the same young man grope her female classmate's chest.The young woman who was groped told her parents, who reported it to the principal, who suspended my niece from school. My niece also spoke to a social worker. My older sister is worried that Child Protective Services is going to get involved. Although I love my older sister, I think a responsible adult needs to intervene and if I were financially stable and could be my niece and nephew's legal guardian I would (the rest of my niece and nephew's family cannot do it because they all have criminal records).The issue that I'm facing is whether or not I should report this concern to Child Protective Services. It's obvious that something is going on in my sister's home to cause my niece to act out inappropriately, but I don't want my niece and nephew to go into foster care. I was raised in the system and I know how terrible and horrifying it is. If I report this to Child Protective Services, I will be betraying my family; if I don't, my niece could possibly continue being exposed to something that is traumatic or abusive. I'm hoping that an objective point-of-view will help me make my decision. I've talked to my surrogate aunt who knows my history as well as my former guardian ad litem and they said I should report it. via /r/Parenting http://ift.tt/2x2ZzP0