During The Year of the Rosary, the Vatican agreed that wearing a rosary around one's neck could create excellent opportunities for dialog on the faith. They even created a special brochure for teens to have with them and hand out as needed.
Now we have a school that bans wearing rosaries around the neck because it MIGHT be construed as gang related.
From a Catholic news source we have a rather scary little article about actual twisting of one's faith by these kids.
To me, a rosary is a sign of one's faith. A reminder to "pray without ceasing" as the Bible advises us to do. Turn every thought, dream and wish to the Lord. Place it all in His hands.
Rosaries have a special place in my faith formation. Our whole lives are faith formation. I feel very sad for folks who miss that. Anyway... The rosary is a time to contemplate the sacrifice Jesus made for us. God Himself, come to live the human condition. The rosary is my traveling prayer book. It goes everywhere with me. I favor wrapping it around my wrist over wearing it around my neck. I can pray at any time. Even just looking at it I am reminded of how I feel when I connect with God.
That being the case, I think counseling and faith formation would help the situation. Tucking the rosary away isn't going to solve anything.