DALLAS One City of Dallas employee was referred to a grand jury, and eight others have been placed on leave.
They are under investigation for their roles in processing federal housing grants for parolees.
They worked on the Project Reconnect program, which has been under investigation since July.
"Properly administering federal funds is an important role of municipal government, and it is imperative that the process and guidelines are strictly followed," said City Manager Mary Suhm in a written statement. "Other law enforcement agencies may join the investigation as appropriate."
Project Reconnect targets non-violent offenders on parole, helping them to transition into the community from a state or federal prison.