most people are going to assume that your SIL is of sound mind. most people can't understand the mentality that goes along with these type situations. most people assume that she is completely aware and therefore able to make her own decisions. and therefore most people will be very dismissive and judgmental. it's not that easy.
you need to understand that her mind is not sound right now. she more than likely has no clear thinking. she probably has no confidence, no accurate awareness, and more fear than she knows what to do with. more than likely she feels paralyzed, hopeless. she doesn't see an easy/hopeful/positive route to take. she might have begun to believe the condescending things he tells her. she believes him because he's not that way all the time. he smiles and he's sweet and he probably even thinks he loves her or does, in a weird way. she doesn't want to believe that she could have been this oblivious enough to get herself into this situation. it's hard for a smart woman to realize she's a victim...she just can't be because she's smart, right? so she then probably thinks that what he is saying is real. she believes it because she is so lost, and he probably isn't (in her eyes,) so why not believe him? it's a catch-22.
you don't have to understand this. it doesn't make sense to most people. what i hope you can do is believe that whatever it is, whatever doesn't make sense to you, that that's what IS making sense to her right now. right or wrong, accurate or not, that's what is on the table right now.
you cannot change this situation. it is not up to you, it is not in your control, it is not, ultimately, your responsibility. because you cannot MAKE her do anything. but this does not mean that you are helpless or you should give up or you should feel like there is nothing you CAN do.
your SIL needs to be able to recognize some sort of support. SHE needs to understand and be able to have safety and security in a support group. a true support group will not TELL her what she is. they will not DISMISS whatever it is she's going through, regardless of how much sense it makes, or the lack of sense it might seem like. it's hard to understand, but it is REAL to her. and someone who is able to truly be supportive will understand that she will feel support when she feels safe enough and trusted enough to be able to relay ALL that she's thinking and feeling. and not be dismissed as crazy. and not be judged for all she thinks and feels.
perhaps YOU can help by helping her to find support. best friend? your spouse? her mother. YOU. a counselor. a support group. you can start by trying to find a safe person that she can confide in.
if she is able to find someone she can turn to, perhaps, as she begins voicing aloud and considering all she's thinking and feeling, she, along with the supporter, can begin to figure out things that she doesn't think are accurate. perhaps she'll begin to find confidence again as she wanders through herself...something she's been so far removed from for a while, more than likely. hopefully, as progression happens, as discoveries are made, she will be able to find clarity and strength in herself, and also an awareness that this is, in fact, not healthy, and that no, no matter how imperfect she is, she does not deserve such things.
and yes. this will take time. no one knows how long. and she has to do this herself. and this situation seems to be one that is not going to allow for a long stretch of time to discover, process and act. can you go to her and gently give her your concern? don't berate her. don't TELL her what's wrong. or that she's stupid. or that she's better than this. she won't be able to understand this, and you'll lose her. she won't have confidence or belief in you because she cannot feel it from you. the chance will be lost, no matter how hard you try.
voice your concerns. voice what you see is happening to her, and why it bothers you. what is it that hurts you to see about her the most? try to find something that SHE might be able to believe about herself that you are MISSING. reassure her with how you feel about HER. you are worried and hurt and upset by the fact that YOU feel like she's missing from your life. for whatever reason you do have, so long as it's the truth. you just want her to know that you believe in her, that you understand that you DON'T understand the situation but that doesn't matter to you...you want to be there for her, you ARE there for her when she's ready to want a safe place to come to. be gentle. don't criticize. be sensitive. be open. be patient. and try your damndest to make her FEEL that you love her. and THAT'S where all of this is coming from.
i don't know legally what you can do. make records. record things that are said and the dates. call hotlines that are set up for emotional/physical abuse. let your concerns be on record. i don't know if you can call the cops about a concern...they sure can't do anything...but it'll be on record.
and good luck. don't give up on her just because it's hard to understand. it IS. but it doesn't matter that it doesn't make sense to you. what matters is that this is real to her, and you want to help her. it's not easy to work, but it's easy to know why you are invested. and sometimes that's enough to spark the change.