The Securities and Exchange Commission yesterday said that Greater Washington Investors, Inc., a local venture capital firm, engaged in questionable practices related to a major investment that turned sour four years ago.

In a report resulting from a four- year investigation of the firm, the SEC stopped short of charging any of the firm's executives with fraud or claiming lack of good faith by GWI officials.

"The report criticizes certain isolated business judgments made by the GWI directors," GWI President Don A. Christensen said in a written statement. "We have informed the SEC that we disagree with their views which in our opinion are unsupported by the facts or by the normal practices of the venture capital industry."

The investigation was prompted by the suspension on Nov. 7, 1974 of the firm's over-the-counter trading in securities because of questions concerning the GWI's valuation of securities for the semi-annual period ending June 30, 1974.

Part of GWI's problem stemmed from a real estate development subsidiary in Mississippi. GWI had never intended to operate a business, having been set up mainly to finance small, technology-oriented companies. In 1968 the company invested $500,000 in Coast Land Co., later named Creare Corp. and later changed to Singing River Properties, Inc., a venture formed to develop a huge residential and recreation complex on 2,000 acres of Mississippi Gulf coast.

That investment was later increased to $2.6 million. In mid-1971 GWI fore-closed on the project and by mid-1974 Singing River was unable to pay interest on a $4.5 million loan.

The SEC said in its report yesterday that Singing River was not strong enough to repay the loan and that liability rested with GWI.