Elizabeth Holmes, the founder and chief executive of the blood-testing company Theranos, was charged with fraud by the Securities and Exchange Commission on Wednesday for raising more than $700 million from investors by falsely promoting a key product, the commission said.

In announcing the charges, the SEC also said that Theranos and Holmes, 34, had agreed to settle them, with Holmes agreeing to pay a $500,000 penalty. As part of the settlement, she was stripped of control of the company and barred from being an officer or director of any public company for 10 years.

Holmes was a self-made billionaire and Silicon Valley darling who persuaded high-profile investors to back Theranos, a private company, based on promises that it would revolutionize the lab-testing industry. She promoted tests that used a finger prick of blood and cost a fraction of traditional lab tests. But a series of articles in The Wall Street Journal in 2015 cast doubt on whether the technology worked.

It turned out that Theranos was exaggerating the promise of its proprietary blood tests and was actually conducting the vast majority of blood tests using traditional machines made by other companies, according to the SEC complaint. Holmes also claimed that the Defense Department was deploying the company’s test in battlefield settings, which was untrue.

Theranos announced in October that it was closing its lab and laying off about 340 employees, or more than 40 percent of its workforce.

In a separate complaint, the SEC also accused Theranos’s former president, Ramesh Balwani, with participating in the fraud. The commission said it planned to pursue its claims against Balwani in Federal District Court for the Northern District of California.