A woman considered among the pioneers of the fee-only financial planning movement has pleaded guilty to using a Ponzi scheme to embezzle more than $3 million from clients.

Judith Zabalaoui, 71, bilked her New Orleans area clients between 1993 and 2007 while working as an independent advisor, according to published reports.

Zabalaoui was charged with gaining limited power of attorney over client funds by promising returns of between 13% and 26% if clients invested in two companies, the reports said.

The companies, however, were nothing more than UPS store mailboxes that Zabalaoui rented in Colorado and Delaware. She also set up phone lines and created phony letterhead and employee names to support the ruse.

The funds were embezzled using multiple wire transfers from Charles Schwab custodial accounts to her personal account. She then used the money for on an array of personal items-including clothing, vacations and rent payments-for herself, friends and family members, according to the Times Picayune in New Orleans.

Most of her clients, according to published reports, came from Resource Management Inc. in Metairie, La., which she founded in 1974, according to the Times Picayune. By the time she left the firm in 1991 to set up her own business, Zabalaoui was regarded as one of the pioneers of the financial advisory profession and among the first advisors to transition to a fee-only model in the early 1980s. She became a certified financial planner (CFP) in 1979, but the certification expired in 1999, according to the Times Picayune.

Resource Management has denied any involvement with Zabalaoui since she left the firm and has not been accused of any wrongdoing, according to the Times Picayune.

She pleaded guilty in Federal District Court in New Orleans on Wednesday to five counts of mail fraud as part of a plea agreement in which she has agreed to pay restitution to clients.

At her plea hearing, she told the court that she moved to Birmingham, Ala., after Hurricane Katrina and that she has suffered from depression, according to the Times Picayune.

Zabalaoui faces a maximum sentence of 20 years in prison, a fine of $250,000 and three years of supervised release for each count against her, according to published reports. Her sentencing is scheduled for May 20.