Flash light problem

Are you new to photography? The flash emits an intense light and depending on where it is found on the camera in relation to the lens, it will cast a shadow on one side or the other. DSLR cameras solve the problem by mounting an external flash directly over the lens and high up so the shadow is less noticeable. If you take a lot of people's faces, you might want to explore "fill lighting".

the camera is getting old and may need to be replaced

http://www.olympusamerica.com/files/oima_cckb/SP-310_SP-350_Advanced_Manual_EN.pdf

p.156 is Troubleshooting section of the manual.

green and orange lights flashing mean that the batteries are exhausted.

Besides the auto-flash mode, you can select fill flash, flash off, self-timer, and nighttime-view with or without flash.
Press the MODE-SELECTOR BUTTON until the desired indicator appears on the LCD PANEL.
Fill flash and flash off modes remain selected after you take the picture. To cancel the selection, press the mode-selection button or close and reopen the lens cover/flash to return to the auto-flash mode.
Fill flash
When bright light indoors or outdoors comes from behind the subject (backlighting), dark shadows (especially on faces) may occur. Use fill flash to lighten these shadows.

1. Open the LENS COVER/FLASH to raise the flash and to turn the camera ON.
2. Press the MODE-SELECTOR BUTTON repeatedly until the FILL-FLASH INDICATOR appears on the LCD PANEL.
3. Frame your subject within the VIEWFINDER EYEPIECE.
4. Partially depress the SHUTTER BUTTON. When the FLASH/CAMERA-READY LAMP turns off and the fill-flash indicator on the LCD panel stops blinking, fully depress the shutter button to take the picture.

Flash off
When you do not want to use the flash, especially indoors where flash is prohibited, such as in theaters and museums, or when you want to take twilight scenes or distant subjects that are beyond the flash range, or capture the ambiance of existing light, use the flash-off feature. Use a tripod or place the camera on another firm support, and use high-speed film because the shutter speed in these situations will most likely be slow.

1. Open the LENS COVER/FLASH to raise the flash and to turn the camera ON.
2. Press the MODE-SELECTOR BUTTON repeatedly until the FLASH-OFF INDICATOR appears on the LCD PANEL.
3. Frame your subject within the VIEWFINDER EYEPIECE.
4. Press the SHUTTER BUTTON to take the picture.

Self-timer with auto flash
Use this feature to include yourself in pictures.

1. Use the TRIPOD SOCKET to attach the camera to a tripod or place it on another firm support.
2. Open the LENS COVER/FLASH to raise the flash and to turn the camera ON.
3. Press the MODE-SELECTOR BUTTON repeatedly until the SELF-TIMER INDICATOR appears on the LCD PANEL.
4. Frame your subject within the VIEWFINDER EYEPIECE.
5. Press the SHUTTER BUTTON. The SELF-TIMER LAMP will glow and then blink during the last three seconds of countdown.
   • To cancel the self-timer selection before the shutter releases, close the flash.
   • The self-timer automatically turns off after the shutter releases.

Night-view with flash
In this mode, the camera balances the flash and existing light exposure so you can take beautiful pictures of people at sunset or at night. Use a tripod or place the camera on another firm support, and use high-speed film because the shutter speed at night will most likely be slow.

1. Open the LENS COVER/FLASH to raise the flash and to turn the camera ON.
2. Press the MODE-SELECTOR BUTTON repeatedly until the NIGHTTIME-VIEW INDICATOR with flash appears on the LCD PANEL.
3. Frame your picture in the VIEWFINDER EYEPIECE.
4. Press and hold the SHUTTER BUTTON for 12 seconds without lifting your finger. Note: If you remove your finger from the shutter button before 12 seconds, the shutter will time out immediately.
   
5. After 12 seconds, release the shutter button to take the picture.

Night-view without flas
In this mode, you can capture the natural existing light of city-night scenes or fireworks at night. Use a tripod or place the camera on another firm support, and use high-speed film because the shutter speed at night will most likely be slow.

1. Open the LENS COVER/FLASH to raise the flash and to turn the camera ON.
2. Press the MODE-SELECTOR BUTTON repeatedly until the NIGHTTIME-VIEW INDICATOR without flash appears on the LCD PANEL.
3. Frame your picture in the VIEWFINDER EYEPIECE.
4. Press and hold the SHUTTER BUTTON for 12 seconds without lifting your finger. Note: If you remove your finger from the shutter button before 12 seconds, the shutter will time out immediately.
   
5. After 12 seconds, release the shutter button to take the picture.

Hello, I went and researched a few points in the manual and hope this helps to some extent. If this doesn't help, try resetting your camera by removing the batteries for 30 seconds, then reinstalling them and turning on the camera again. 
Monitor is blank: 
• Camera is off.
• Batteries are not correctly inserted or battery-chamber
cover is not properly latched.
• Batteries are exhausted.
• EH-62B AC adapter (available separately) is not properly
connected.
• Camera is in sleep mode. Press shutter-release button
halfway.
• Monitor is off.
• USB cable is connected.
• AV/Video cable is connected


No picture is taken when shutter release button is pressed:

• Camera is in playback mode.
• Batteries are exhausted.
• Red (!) lamp flickers: flash is charging.
• Green (AF) lamp flickers: camera unable to focus.
• Message "CARD IS NOT FORMATTED" appears in
monitor: memory card is not formatted for use in your
camera.
• Message "OUT OF MEMORY" appears in monitor:
insufficient memory to record picture at current Image Mode selection.

Hey D1ppy,
There are two ways to get rid of shadows behind a subject, but both require you to use a hotshoe mounted flash. The first way is to bounce the light off a ceiling or some other white surface by turning the flash head towards that surface instead of your subject. The second way would be to connect the flash to the camera using a off camera flash cord and hold the flash above your head when your taking the picture, and by doing this you are able to aim where the shadows show up in the image. Bounced flash is what is called soft light and generally is more pleasing light. I of course am assuming the shadows are caused by the built in flash on the camera. I hope this helps!

Sincerely,
Allan
Go Ahead. Use Us.

If your having problems with your camera, for about 20.00 you can buy the same camera on Ebay.

Sounds like your lense cover is not fully retracting when you turn your camera on, thus when the flash goes off these are creating shadows on your picture.

All solid objects cast a shadow; it cannot be avoided. Certain techniques will help control or reduce the shadow by eliminating or reducing the harshness of the flash. Some of these techniques are: Elevate, eliminate or soften the flash: Make sure the flash is above the lens when you camera is turned to vertical (portrait) orientation. If the on-camera flash is higher than the subject, the lens should not "see" the shadow in most situations. Make sure the camera is higher than the subject, but not so high that you make a shadow in the other direction (under your subject's eyebrows, nose or chin, for example). If there is enough natural light, you might be able to turn the flash off, or you can add "natural" light to the scene by opening curtains, turning on room lights, and so on. In low light you can still photograph without the flash by making sure the camera does not move during the exposure. Consider using a tripod or monopod. The auto color balance feature should automatically adjust the color for the light source. Sometimes it is helpful (at least minimally) to include a white or near neutral grey item within the camera's field of view to assist the camera's color balance assessment. Mixed lighting gives mixed results. Illuminate, eliminate, or move away from the object that has the shadow cast upon it (a wall, for example). Or, use it to your advantage by angling for a better position that may bounce and diffuse the light from the on-camera flash by reflecting light off the wall. Some photographers might lay a white sheet in front of the subject to soften the light by bouncing the light off the ceiling.