I would tell your sister.
She hasn't seen him for years, she knows he has cancer, she hasn't heard from decided not to tell her.
him for a year
So honestly. I don't think this news is going to be a shock.
You can say something to her
"Remember our brother was so very ill with cancer? I need to tell you he has gone. He died very peacefully. "
If she asks when, or what about the funeral, you could reply truthfully
"It happened at the end of summer"
"They've had the funeral, very quiet.".
If you are visiting her face to face, why not take some photos of the three of you , and share some memories.
Your neices made a very wrong decision , but you can put it right. You need to do this for both your sakes, hers and yours.
IF it comes out that he died a year ago, just say that the neices made a decision against your wishes, and you are very sad that the news was kept from her.