How would you handle this situation? I'm concerned I might have handled it the wrong way..?

My husband and I had a baby boy in sept. '06. My husband has a little brother who is eight now, six at the time my son was born. Well, there was a loooot of jealousy when he came along, and by the time he started crawling my husbands brother (I will refer to him as BIL from here out b/c that's what he is to me) was hitting him, had kicked him in the back and knocked his face into the floor, was jerking things from him, had put him in headlocks, knocked him off chairs.. I mean, he was really mean to him. I addressed the situation and didn't let my mother in law keep him for several months b/c she wasn't handling the situation to my satisfaction. Well, it's about 2 years later now, and I thought we were past all this but I let MIL keep my son for two nights last week, and when we went to pick him up, I noticed BIL being mean to him again. He kicked him in the back (not really hard, but hard enough), he smacked him in the back of the head three times, and he yells at him. Also, if I say he can't have something (Like candy) BIL will give it to him anyway, then come to me and say "He's got candy when you said he couldn't have it!" and try to get him in trouble (and if he thinks he's going to get in trouble he'll follow you into the room to watch)