The former chief executive of a Sherman Oaks securities brokerage has pleaded guilty to wire fraud and tax evasion for an investment scam that cost clients nearly $4 million, the U.S. Attorney’s Office announced on Tuesday.

David Williams, who ran broker-dealer Morgan Peabody Inc., reached a plea agreement with prosecutors that carries a maximum sentence of up to 70 years. He is scheduled to be sentenced Sept. 28 in U.S. District Court in Los Angeles.

William, 54, of Studio City, acknowledged he directed Morgan Peabody employees to sell securities in a fund that he had created, supposedly to invest in real estate. However, Williams used the majority of investor money from the fund to pay for personal expenses, including a lease on a $6 million Toluca Lake residence, according to the plea agreement.

Between June 2007 and April 2008, the scheme took in more than $3.75 million from approximately 60 investors. The company closed in 2008.

Williams pleaded guilty in the middle of a jury trial to three counts of wire fraud and two counts of tax evasion. He received more than $2.3 million from the investment fraud that he didn’t report for taxes. As part of the agreement, Williams will pay $777,881 in taxes, plus a civil fraud penalty and interest.

The investigation was conducted by the FBI and the Internal Revenue Service.

The Securities and Exchange Commission previously filed a civil lawsuit accusing Williams of misappropriating millions of dollars raised from investors through three securities offerings.