In Chapter 2 Tom, Nick, and Myrtle go into the city. While at a party in their apartment, Nick meets Myrtle's sister, Catherine. While gossiping with Nick about Gatsby, Catherine tells Nick about Tom's relationship with Myrtle. She tells Nick that Tom actually wants to leave his wife, but that he cannot because of her religion. According to Catherine she is Catholic.
“She’s a Catholic, and they don’t believe in divorce.”
Nick knows that his cousin isn't really Catholic, but thinks he shouldn't bring it up. Their conversation is interrupted when Nick begins explaining how she is too good for her husband, George, and what is it that attracted her to Tom.
Although Catherine says that Tom can't stand Daisy (and that Myrtle can't stand her husband, George Wilson, either), she claims that Daisy is keeping Tom and Myrtle apart because she's Catholic and Catholics "don't believe in divorce." Nick is surprised by the detail of the lie because Daisy isn't Catholic, and it seems an odd thing to simply make up.
Then again, the more Catherine talks, the more she seems like an incredible liar. She goes on to tell Nick that when Tom and Myrtle eventually do get married—as though this is an inevitable eventuality—they are going to move West, something Tom seems to have absolutely no interest in, until their spouses get over it and the scandal dies down. She tells more stories about how she just returned from Europe, where her friend lost a bunch of money and she almost married "a little kike"; thus, Nick can quickly ascertain Catherine's total lack of honesty as well as her antisemitism.