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I figure he's gonna know who told on him anyway, so I'd confront (in the polite but firm manner I know you can), and tell him exactly what you've told us. Tell him that it's not only bad information, but it could come back to bite him legally. At the least, people are going to figure out he doesn't know the law, and by word of mouth he'll have no more students. I think you'd be doing him a real favor. If he's open to your comments and instruction, maybe you could straighten him out. If he tells you to bug off, call DPS.

If I was a teacher teaching bad information out of ignorance (not out of malice), I'd WANT someone to set me straight, and show me the information.