My wife's sister is marrying a man so that he can become a U.S.
citizen.  The arrangement is that she will use his health insurance
and she will help him become a full citizen.  He is from Venezuela and
is here on a temporary work visa.  She is naive, and thinks it will be
easy to get him citizen status.  Although they are going to move in
together, they are not in love or know much about each other.  She is
hiding the marriage from everyone in her family except for my wife.  I
am worried because he seems she has gotten in over her head.  What
obstacles is she facing?  Is there anything I can do, such as report
it to authorities?  Can I get in trouble for not reporting it?

The first site is that of the US Citizenship and Immigration Service 
- THE official source.  The second is that of a law firm, and may be
easier to follow:

http://www.uscis.gov/graphics/faqsgen.htm#marriage
http://www.shusterman.com/marriage.html

Personally, I agree with you that your sister-in-law seems quite
naive.  Marriage is a whole bunch of legal matters, many related to
money and property, and mutual responsibility, even with separate
accounts.  She should be talked to by a professional on the subject,
maybe a divorce lawyer in the state, since the laws vary.

There ARE men who take advantage of naive women, even without marrying them.

Perhaps you or someone here can find a scare article on the subject.