Expanded investigations into Wal-Mart Stores Inc.'s potential violations of the U.S. Foreign Corrupt Practices Act could result in significant fines and penalties for the retailer as well as more shareholder litigation.

The situation also is a warning to other firms to introduce strong compliance programs, particularly in light of the Department of Justice and Securities and Exchange Commission's issuance of long-awaited guidance on the U.S. law that punishes foreign bribery, inaccurate financial records and inadequate controls of U.S. companies doing business abroad.

In an SEC filing this month, Wal-Mart revealed that FCPA investigations had expanded beyond Mexico to include “but not limited to Brazil, China and India.”

Wal-Mart said it is “conducting a voluntary global review of its policies, practices and internal controls for FCPA compliance.” In addition, Wal-Mart said it had been informed by the Justice Department and SEC “that it is also the subject of their respective investigations into possible violations of the FCPA,” and is cooperating with the investigations.

The Bentonville, Ark.-based company, which declined comment on the latest investigations beyond its written statements, already faces a shareholder lawsuit for a 4.7% drop in its stock after its April announcement of potential FCPA violations in Mexico.

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The retailer said shareholder suits were among a “variety of negative consequences” it could face as well as fines, penalties and criminal convictions. While it already spent $99 million through October on such issues, it said it doubted these matters would have a “material” effect on its results, but there is “no assurance” this will be the case in the future.

FCPA expert Matteson Ellis, of Matteson Ellis Law P.L.L.C. in Washington, said the announcement “is a very common progression of internal investigations into potential FCPA violations.” However, the fact that Wal-Mart's investigation has expanded “suggests that the issues were systemic at the company, rather than isolated to a specific business unit.”

If systemic, widespread corruption is found, “then the resulting fines and penalties are usually much greater,” Mr. Ellis said. Should it be found that there was “willful blindness” by top executives, “it could have a damaging effect on their reputation,” he said.

However, he noted, Wal-Mart's stock recovered from the 4.7% dip it experienced after the initial announcement about FCPA investigations involving Mexico.

Jeffrey Kaplan, a partner at Princeton, N.J.-based Kaplan & Walker L.L.P., said the Wal-Mart situation must be examined in light of the new FCPA guidance.

“It is an area where you have had enormous fines in the last few years, so it could certainly impact a company in terms of direct fines,” Mr. Kaplan said, noting that could spark shareholder suits alleging directors and officers failed to prevent wrongdoing.

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“What's different about Wal-Mart” from other cases is that, reportedly, its executives “learned of the problem years ago and, instead of fixing it and reporting it to the government ... suppressed it and covered it up,” Mr. Kaplan said. “If it turns out to be true, I think you're going to have a very harsh punishment on the part of the government.”

Patrick J. Egan, a partner at Fox Rothschild L.L.P. in Philadelphia, said the situation “speaks to the fact that it is very, very difficult for any multinational corporation to maintain control over what takes place in its foreign locations; and even if you have a really robust compliance program, the problem is that there's always the incentive” for corruption “and all you can really do is educate everyone and limit it and deal with it as quickly as possible.

“Where companies get in trouble is either when they try to cover it up — a huge mistake — or they don't have a robust compliance plan that's commensurate with the size of the institution,” Mr. Egan said. “But this is not going to go away anytime soon, and the damages are going to get very ugly, no matter who you are.”

However, Richard J. Bortnick, a Philadelphia-based member of Cozen O'Connor, said Wal-Mart “is setting a good example as a corporate citizen for investigating allegations, taking them seriously, and working with the government” to determine what happened “and most likely create an infrastructure” to address the situation.

He also noted that after President Barack Obama's re-election, “the government will be more aggressive in investigating and prosecuting FCPA violations.”