Dr. Munhihausen II said:
First ask your neice if she called the white girl out of her name.
(many times black students feel that it is ok to call white students racial slurs without being called one back. One time this black boy was arguing with this white girl in class and called her a honky. She then replied "fuck you ******". Dude was acting offended. I was trying to not laugh.....because her reaction was inevitable).
If your neice did not call her a slur first, then report the incident to the proper authorities.
Dont make her regret her actions by suggesting stupidity.