Hi Bex,
Your f-i-l does have a dietary problem, and good for you for trying to convert him to a healthier dietary regime, but fried food is the least of his worries!! I would hazard a guess that your concerns are over his risk of heart disease, when his more urgent need is to control his diabetes.
All carbohydrates (and sugar is just a very quick-acting carbohydrate) convert to glucose in the blood. A normal (non-diabetic) person is able to produce sufficient insulin to extract the glucose from the blood and store it as energy in the body's fat or muscle cells. Fat and oil has no effect on blood glucose, other than by slowing the rate at which the body converts carbohydrate into glucose (which can in fact be helpful to a diabetic).
Type-2 diabetics have a problem in that they either produce insufficient insulin, or the insulin they do produce struggles to convert the glucose (known as insulin resistance). This then leads to having very high blood glucose levels, which, if not controlled, will eventually lead to other problems. What your f-i-l needs is a reduction in the carbohydrates he eats, not in the fat/oil. The worst offenders on the carbohydrate front are bread, pasta, rice and potatoes. These contain small quantities of fibre and vitamins but are mostly just starch. If you really want to help him then get him to eat less of the starchy foods and more protein, vegetables and fruit. Vegetables and fruit also contain carbohydrates (in fact all that the body needs) but are also packed full of vitamins, minerals and fibre.
Have a good look around this Food Forum section and the other sections and you will find a lot of help and advice on diet for diabetics. Shout if you have any questions though.