Olympus Corp. announced yesterday that it has been covering up investment losses for decades—relying on acquisitions of other companies to hide the losses. The surprising disclosure comes after weeks of the Japanese-camera maker issuing statements defending its actions.

As the biggest and longest running loss-hiding scheme in the country's history, the news is a blow to Japan's corporate system. The future of the 92-year-old company is now in question, and authorities—including the Tokyo Stock Exchange and the U.S. Federal Bureau of Investigations—have launched investigations into the company's misdeeds.

The losses center around several of the company's deals that had recently become controversial, including billions of dollars in payouts to a fund based in the Cayman Islands.