DHS moves to cut off South Texas Catholic Charities over migrant grant 'misconduct,' documents say

EXCLUSIVE - Catholic Charities of the Rio Grande Valley - the South Texas nonprofit long known for its migrant shelter run by Sister Norma Pimentel - has been suspended from receiving federal funds and now faces a rare six-year debarment after a Department of Homeland Security investigation found major grant violations, according to internal Department of Homeland Security (DHS) documents shared exclusively with Fox News Digital.

The action, taken by FEMA on behalf of DHS on Nov. 19-20, follows months of warnings and data reviews that auditors say uncovered sweeping inaccuracies, large gaps in migrant records and significant billing outside federally allowed timeframes.

The suspension applies only to this South Texas affiliate, not to Catholic Charities USA or any other Catholic Charities chapters nationwide.

In a formal Notice of Suspension and Proposed Debarment, DHS officials accused the organization of submitting migrant data so inconsistent the agency could not verify whether many of the people it reported serving had ever appeared in DHS databases.

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Investigators also alleged at least 248 instances in which the nonprofit billed the government for services outside the 45-day window federal rules allow for migrants released from DHS custody.

FEMA concluded the group provided assurances that its spreadsheets were accurate and compliant, statements the agency said were "false" or "not entirely truthful," according to the documents.

The proposed punishment is unusually severe. While federal debarments typically run three years, DHS is seeking a six-year ban due to what it describes as a pattern of "pervasive" problems that spanned multiple programs and multiple years.

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If finalized, the designation would cut the organization off from most federal funding streams and flag it in the government-wide System for Award Management, warning agencies and pass-through partners not to issue new grants.

Catholic Charities of the Rio Grande Valley (CCRGV) now has 30 days to respond, submit documentation or request a meeting to argue it remains "presently responsible." If it does not, the six-year ban would likely go into effect.

The DHS findings center heavily on migrant intake data the nonprofit submitted to justify millions of dollars in payments through FEMA's Emergency Food and Shelter-Humanitarian program (EFSP-H) and its newer Shelter Services Program. FEMA said it asked the group to provide names, A-numbers, countries of origin and evidence of DHS encounters for individuals it claimed to assist. In response, the nonprofit told the agency all migrants had A-numbers recorded and asserted its spreadsheets were accurate within a 4.99% margin of error.

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Auditors said the reality was far different. In sample sets reviewed by the agency, A-numbers were frequently missing, truncated to four digits, or replaced with phone numbers and other stray entries. Error rates reached 21%, 26% and 42% across three spreadsheets, the documents show. When FEMA tested 100 names, it could not find 61 of them in DHS systems at all.

Investigators also stressed the Rio Grande chapter's 45-day rule violations. Under federal guidelines, NGOs may only bill for food, shelter or transport for migrants within 45 days of their release from DHS custody.

FEMA told the organization it found at least 248 cases where billing dates occurred after that window had closed, raising concerns that federal dollars were used for services outside what the law allows. The agency wrote that such activity could amount to "potential criminal activity," though DHS has not said whether it plans to refer the case for criminal review.

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The documents further cite the nonprofit's own posted FY 2024 audit, which reported "material weaknesses" in internal controls over federal awards, inconsistent intake procedures and missing documentation for roughly 5% of sampled recipients. FEMA said corrective-action plans were copied forward almost verbatim year to year, without meaningful improvements.

Catholic leaders have recently pushed back against efforts to cut funding. Pope Leo XIV praised Catholic Charities USA this fall as "agents of hope," commending its 168 agencies for decades of work with migrants, refugees and the poor.

Pimentel, who leads the Rio Grande Valley branch, has for years been a national figure in migrant ministry. Her Humanitarian Respite Center once processed more than 1,500 migrants per day at the height of mass crossings. She has been publicly praised by the Vatican for her humanitarian work and has spoken out against a return to the Remain in Mexico policy, saying families forced to wait in Mexico suffered "tremendously."

But her organization has also been a political focal point. Texas Attorney General Ken Paxton has pursued cases against several Catholic migrant shelters, accusing them of encouraging illegal immigration and operating illegal "stash houses," including his suit against Annunciation House in El Paso. A judge earlier this year blocked Paxton from deposing Sister Norma in that separate matter.

The suspension now places the Rio Grande Valley operation under simultaneous federal and state scrutiny. It is not yet clear whether other local shelters or municipal partners can absorb the South Texas caseload if the nonprofit ultimately loses federal funds. CCRGV currently serves far fewer migrants than in prior years, but remains one of the region's key intake points.

DHS has not said when a final decision on debarment will be made. The organization continues to operate during the suspension period but cannot receive new federal awards until the matter is resolved.

Fox News Digital reached out to Catholic Charities for comment.

DHS noted to Fox News Digital that future debarments may occur and that investigations remain ongoing.