Oh boy.

You have some very serious decisions to make.

What can you do you asked? You tell bf to move out. OR you move out and take your kiddos.

IF you decide to wait it out and Seeeee...you may be looking at the inside of a court room fighting like hell to clear your name. PROTECT you and your kids first.

Then figure out everything else.

JMO

I would get an attorney and get ready to go for BM's throat for manipulating the toddler, for false alegations, and defamation.  3yos do not come up with this crap on their own.  I would bet dollars to donuts that this is a BM farbrication.

This represents a serious threat to maintaining custody of your own children.  You should prepate to dump the toddler off on BM and keep him out of your home if you can't destroy BM over this.  

I would not tolerate the risk this all represents to  your own children.

Any chance the elder Skids are of sufficient character to tell the truth and shut this crap down with CPS if it goes that far?

Until you figure out what you are going to do.... disengage completely from this kid. Not that she is a bad kid, she is only three, but you need to protect yourself. Don't agree to watch her for even a minute. If she is in your home, your DH needs to be taking care of her. Don't put yourself in a situation where you are ever alone in a room with her for even a minute. 

Talk to the step parents & say that it's not true. Kids are kids, they act up all the time maybe this one is a little shit, so be assertive & challenge the accusation. If you love your partner you will stay if you don't you should leave. You take your partner & all the shit that comes with it unfortunately. You need to break down all the barriers that will affect your relationship, that's the only way it will work.

Take the lead and file paperwork for false allegations (If BM is believing SD). Tell DH you will NOT be alone with his SD anymore. If she continues to visit, he will need to be the one supervising her. Hopefully you can let him know in the meantime with the court paperwork it would be best if he just conducted visits at a netural place (park, restaurant, etc.) It will also teach SD a lesson. I'm sure she will be like "Daddyyyy why can't I come to your house?" "If you're lying to your Mom and Step Dad, then you can't be allowed over." Hopefully this will nip it in the bud. 

When my SD was 6, she told her BM I "called her dumb" and said "I was prettier than her." In turn, BM filed a restraining order on SD behalf claiming "psychological abuse." At the time DH (then BF) and I were lviing together. He was FURIOUS! He said this was all because of SD. BM ended up dropping it and didn't even show up to court. But what a pain in the @ss to go through all because of SD.

Things were fine for awhile, then when my SD was 8, she started lying to her BM and her BF saying all I do is "send her to her room and lock her in there." I confronted her IMMEDIATELY, because at this point, I THOUGHT we had a good relationship and I was taking her to the neighborhood pool literally every single day while DH was at work. I let her know if these are the stories she's telling, then we're just going to stop doing things. SD definitely stirred the pot to watch the drama play out between her parents. We let her know that all she was doing was hurting everyone involved feelings... because BM would get upset thinking it happened, and I got upset because she was lying and not being appreciative of the things I was doing for her. She cried about it but eventually it stopped. So just a warning, if SD is only 3, don't expect it to not continue in the future. Manipulative little brats don't grow out of it overnight. Be prepared for her to do it again. Best of luck.

Take the lead and file paperwork for false allegations (If BM is believing SD). Tell DH you will NOT be alone with his SD anymore. If she continues to visit, he will need to be the one supervising her. Hopefully you can let him know in the meantime with the court paperwork it would be best if he just conducted visits at a netural place (park, restaurant, etc.) It will also teach SD a lesson. I'm sure she will be like "Daddyyyy why can't I come to your house?" "If you're lying to your Mom and Step Dad, then you can't be allowed over." Hopefully this will nip it in the bud. 

When my SD was 6, she told her BM I "called her dumb" and said "I was prettier than her." Like seriously?? Why would an adult compare their looks to a child?? In turn, BM filed a restraining order on SD behalf claiming "psychological abuse." At the time DH (then BF) and I were lviing together. He was FURIOUS! He said this was all because of SD. BM ended up dropping it and didn't even show up to court. But what a pain in the @ss to go through all because of SD.

Things were fine for awhile, then when my SD was 8, she started lying to her BM and her BF saying all I do is "send her to her room and lock her in there." I confronted her IMMEDIATELY, because at this point, I THOUGHT we had a good relationship and I was taking her to the neighborhood pool literally every single day while DH was at work. I let her know if these are the stories she's telling, then we're just going to stop doing things. SD definitely stirred the pot to watch the drama play out between her parents. We let her know that all she was doing was hurting everyone involved feelings... because BM would get upset thinking it happened, and I got upset because she was lying and not being appreciative of the things I was doing for her. She cried about it but eventually it stopped. So just a warning, if SD is only 3, don't expect it to not continue in the future. Manipulative little brats don't grow out of it overnight. Be prepared for her to do it again. Best of luck.

I am a Smom in a similar situation, turns out my Skids were being abused by their Sdad and were trying to get the reaction from the BM. Has anything come to the surface since your post?