Reports of faulty corporate record keeping and links to the growing controversy over allegations of Clinton Foundation “pay-to-play” schemes could doom the pending initial public offering (IPO) of the for-profit Laureate Education university, according to a Daily Caller News Foundation investigation.

Billionaire George Soros, Microsoft co-founder Paul Allen and private equity investor Henry Kravis all financially back Laureate. The company paid former President Bill Clinton nearly $16.5 million as honorary chancellor from 2010 to 2015.

[dcquiz] Laureate officials are trying to raise $1 billion in the IPO and told potential investors in a May 26, 2016, Securities and Exchange Commission (SEC) filing update the company’s financial statements may be inaccurate and unreliable, after uncovering “five material weaknesses in our internal control over financial reporting.”

Clinton’s tenure partially coincided with the period of Laureate’s inaccurate corporate reports, at least one of which remains unremedied. The company is trying to get out from under a crushing $4.8 billion debt load. A successful public offering would provide significant financial relief to Soros, Allen, Kravis and other Laureate investors. It’s unclear, however, if Laureate could survive a failed IPO.

In the updated SEC filing, Laureate spelled out the consequences of the faulty reporting, stating, “we may be unable to report our financial results accurately on a timely basis, which could cause our reported financial results to be materially misstated and result in the loss of investor confidence.”

Laureate operates 100 campuses in 28 countries, including the U.S., and has been burning through cash for several years. Analysts say Laureate has generated little organic growth.

Further clouding Laureate’s IPO prospects are allegations the firm engaged in a “pay-to-play” relationship with the Clintons and the Clinton Foundation.

Sixty-four House Republicans in a letter last week called for investigations by the FBI, Internal Revenue Service and Federal Trade Commission into possible corrupt ties between Laureate and the Clintons.

FBI Director James Comey hinted at a recent congressional hearing that, while the bureau’s own investigation of Clinton’s private email server is over, a public integrity probe may still be ongoing on the relationship between foundation donors and Clinton political favors.

The public optics are not good for Laureate and and Clintons. While Hillary Clinton was secretary of state and her husband was collecting millions from Laureate, the International Finance Corporation (IFC), an arm of the World Bank, sent a $150 million equity infusion to the cash-starved company.

Laureate donated between $1 million to $5 million to the Clinton Foundation and actively collaborated with a Clinton project called the “Clinton Global Initiative University.”

The New York Department of Education may force deletion of the term “university,” since the program, led by Bill Clinton, has no a curriculum, syllabus, classes, grades or degrees. The Clintons collected nearly $5 million for their “university.”

Kathleen Smith, manager of IPO-focused exchange-traded funds at Renaissance Capital, told TheDCNF the congressional inquiry could delay the issuance of the Laureate IPO.

“It’s going to raise questions about the company and how ‘pay to play’ has affected them. It certainly won’t help them,” she said. “There’s a cloud and that may be why we haven’t yet seen the IPO.”

Jay R. Ritter, an IPO specialist at the University of Florida’s Warrington College of Business, said having Bill Clinton as honorary chairman at the time may have seemed like a “marketing advantage.” The downside is that “any controversy like this is going to hurt the [IPO] valuation.”

Another problem is that Bill Clinton’s Laureate payments were never disclosed on any of the Clinton Foundation’s tax returns.

Charles Ortel, a Wall Street analyst who has closely studied Clinton Foundation filings, told TheDCNF that the omissions are serious. Laureate was operationally tied to the foundation as a sponsor and co-programmer.

“The fact that Bill Clinton was paid $16.5 million over a five-year period is certainly not disclosed in the Clinton Foundation’s 990’s tax filings or with 990 tax documents concerning the Clinton Global Initiative University, which is a one of the joint partnerships with Laureate,” said Ortel, who has also twice served as a trustee for charitable foundations.

“A material omission like this must be corrected. And an explanation must be issued why the omission occurred,” he said.

The $150 million equity investment in Laureate in January, 2013, was the largest single education investment ever made by the IFC and was made one month before Clinton left the State Department, according to IFC documents.

The United States Government is the largest single donor to the IFC, providing 21 percent of its $569 million total funding.

A Laureate spokesman told TheDCNF that “the IFC’s decision to invest in Laureate had no connection to and was not influenced in any way whatsoever by Hillary Clinton.”

But the IFC investment in Laureate was not the only one involving the Clintons. In 2013, the IFC invested another $150 million in a port-and-pipeline project in Colombia that was 49 percent owned by billionaire Frank Giustra. Giustra is a $100 million donor to the Clinton Foundation and co-founder with Bill Clinton of the “Clinton-Giustra Enterprise Partnership.”

The congressional letter also singled out “pay-to-play” problems with Giustra’s Uranium One deal with a Russian uranium agency. The deal allowed Moscow to access uranium mines in the U.S. Hillary Clinton played a prominent role in permitting the mine ownership to be transferred to the Russians as secretary of state.

The Obama administration has tried to end for-profit universities in the United States. Two for-profit universities, Corinthian Colleges Inc. and Education Management Corp. were delisted from the Nasdaq Stock Market last year as the Obama administration pressured the sector.

“For some reason, Laureate escaped aggressive punishment by the Obama administration,” notes Ortel.

The Democratic Party’s education platform also pledges to go after for-profit universities.

“We will go after for-profits that engage in deceptive marketing, fraud, and other illegal practices. It is not right that for-profit schools with low graduation rates keep encouraging their students to take out federal loans they will have trouble paying back,” the party platform states.

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Content created by The Daily Caller News Foundation is available without charge to any eligible news publisher that can provide a large audience. For licensing opportunities of our original content, please contact licensing@dailycallernewsfoundation.org.