(URGENT) My friend [19] came to visit my school and thinks my principal [60] sexually harassed her. Her mom is now trying to bring down the school. What do I do?

I don't know if this is the right subreddit, and if it's not, please guide me to one that might be able to help me better.

I'm at a small boarding school-type place that teaches ideals very similar to buddhism. Though I take everything with a grain of salt (not ready to accept reincarnation as fact, etc), this place has changed my life. I've been here for about 2 months now, and when I returned home for the holidays, a family friend of mine couldn't help but notice the difference in me. I explained where I had been and she was immediately interested. She brought her daughter in the hopes that she would want to spend some time here (being on a gap year). We're both the same age and she's kind of like my sister.

On the first day, everything was amazing. They thought this place was heaven on earth and she was set on coming here in may. However, they left abruptly one morning and I found ou through my parents it was because her mom found her crying in her room.

This is what I know so far:

• the principal/master (who I will describe later) invited her to his study with another student (to translate between english and chinese). The master gave her a book to study, hugged her and kissed her on the cheek. At some point he told her he thought she was a reincarnation of his daughter (who passed some 20 odd years ago). She felt pretty serious discomfort and it lasted much longer than she would have liked.

• afterwards, we had a writing/calligraphy class. The master approached her and corrected her posture and writing for the next ten minutes. In the process, he apparently rubbed her back and shoulders while she was writing. I was near them and I did make note of the extra attention he seemed to be giving her, but it wasn't unusual. He came to me afterwards and did the same thing for a few minutes.

• The student who took her to the master's office did not sense anything was wrong. He's a mostly normal kid of 13

• the master told everything to the vice-principal before anyone knew about it. He said that he thought he met his daughter and that he gave her a "western hug and kiss".

• when the vice principal heard about it, she approached the master and told him, "you hurt someone today." to which he responded "How?" in a really surprised tone. She explained and he said, "isn't that how westerners do it?"

• the vice principal is surprised, but wants to deal with the matter very professionally. At the very least, if this is a misunderstanding, she wants to make sure that the master knows some customs as to not make the mistake in the future.

About the master: He's in his 60s and he's been away from civilization for 30 odd years. He's been trained traditionally and never left his practice. He's the main teacher at this school, which teaches things like how to be a good person and meditation. He's married, but his marriage is very platonic (openly so). There's no physicality in his relationships. He would be considered a little "off" by modern standards because he really doesn't know much beyond his studies (which he probably knows more about than anyone else in the country). He is very strict with his students and there's never been anything even remotely like this in the past. Though, the oldest girls we have here are 17.

About the girl: she's 19 this year, but could pass as 22 or 23, a very good friend of mine and one of the kindest people I know. She's timid, and would never bother anyone with anything that wasn't extremely distressing. She also doesn't get upset very easily. She's intelligent but going through a bit of a transition period after a tough year in college. She also knows to be cautious of what she says around her mom because her mom is known to overreact (like any mother).

About the mother: She's been like a second mother to me for the past 5 years and I have the utmost respect for her. She's the kind of mom who would plow through crowds of people to protect her children. She thinks this place has no morals and wants me to leave immediately. She herself is a buddhist and extremely intelligent.

What the hell do I do? On the one hand, this place has been extremely good to me, and I wouldn't be able to live with myself if it were to be shut down from a misunderstanding. On the other hand, I know the girl and the mother and trust them completely. The reason why I'm posting this in r/relationships is because above all, I want to preserve the relationships I have with the mother and her daughter. On the other hand, I want to do what is right, and I'm not sure if that is to jump to conclusions and assume the master meant harm.

TL;DR: Good friend is timid and would never make a big deal of nothing. She felt violated by the principal/master (who has been separated from modern society for the last 30 years). The mother of my friend wants to take action against the school and I'm torn between preserving life-long family/friends and fighting for a school that could have just been severely misunderstood.