You better believe that kid learned that from somewhere! You're probably smart enough to figure this out for yourself, but I'll say it anyway: Until you find out where that kid learned like that, you do NOT let any kids of yourse anywhere near him his close relatives or anyone else . You have a real pervert somewhere in that family, and I'd have LOOOONNGG, difficult consversations with my wife, if I were you, until I were good and certain who is trustworthy in that family.
he's a weird kid, definitely a creep - and very intelligent for his age which is scary. We don't have kids yet, but yeah, when we do, they ain't going near him.