If your child says this is occuring at school I'd talk with the teacher or administrator. If it is happening outside of school I'd speak with the child's parent.
You should take your child to a counsler and have him or her talk with them. After you should contact the police department, have your child examined by a qualified doctor and get family counsling.
The touch and its matter of importance does not require age or gender as a constrain. It is our duty to provide our children a safe environment in all means. It is better to advice our children to avoid the habit of his and lead him in a good way.
Approach the other child's parents about it. They may be disbelieving, so the situation should be handled with tact. You may want to involve a mediator.