While sexual exploration is common with 10 years olds. It is not when it is between a 6 and 10 year old. and both of them need to know this is not acceptable. I would not leave your nephew alone with your child. I would also get a book such as "I said No" https://www.amazon.com/Said-Guide-Keeping-Private-Parts/dp/1878076493/ref=sr_1_1?ie=UTF8&qid=1531980176&sr=8-1&keywords=private+parts+book+for+kids
and read it with you son. And there are several other good books listed on the site above.