Stock Scandal Enmeshes Japan's Diet. Takeshita government bombarded by parliament questioning, arrests of top officials

By , Staff writer of The Christian Science Monitor

FOR Prime Minister Noboru Takeshita, Friday's funeral of the late Emperor Hirohito will be a welcome respite from the unrelenting corruption scandal dominating politics here. Day after day, Mr. Takeshita's government and ruling conservative party are being pressed about the pattern of influence peddling, bribery, and illegal political fund-raising that has emerged in the so-called Recruit scandal.

The session of the Diet, Japan's parliament, which opened Feb. 10 is consumed with such questions. Opposition parties have proposed reforms. The Socialist Party suggested a political-ethics law with punitive measures for offenders and a ban on corporate donations. The Komei (Clean Government) Party called for changing the political fund-raising law to ensure greater transparency, suggesting that United States law be the model.

Mr. Takeshita reiterated his pledge to make ``political reform'' an administration priority. But the liberal daily Asahi Shimbun said in an editorial last week that ``Takeshita's responses were pure abstractions,'' and accused him of attempting merely to ``keep his mouth shut and try to weather this difficult period.''

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The Socialists, the largest opposition party, and the Communists are pushing for dissolution of the entire parliament and holding of general elections in which they feel certain to gain. Elections for half the seats of the Upper House are already scheduled for July, but the government is eager to avoid a broader contest.

Takeshita now seems strong enough to hold off pressures for full elections. But observers agree the unpredictable course of the investigations could change that.

The scandal, which broke last June, entered a new phase with the first arrests made last week: five Recruit executives, two senior executives of NTT, the national telephone company, and a Labor Ministry official.

Chief Tokyo prosecutor Yusuke Yoshinaga is in charge of the investigation. Mr. Yoshinaga won his reputation as a tough, independent prosecutor through his role as chief investigator of the Lockheed case, the famous 1970s corruption scandal that brought the arrest of former Prime Minister Kakuei Tanaka.

More arrests are certain to come. At least two senior government officials and a former chairman of the telephone giant are expected to be next on the list.

The cases mostly involve the private sale of unlisted shares in a Recruit real-estate subsidiary, Recruit Cosmos, which were certain to rise in value when stocks were sold to the public. Some 160 persons reportedly received shares, including prominent businessmen, officials, and Diet members.

But the big question is how the prosecutor will handle the 17 politicians known to have gotten shares. ``The people are highly interested in whether the investigations will go as far as to encompass members of the Diet,'' the Asahi said in another editorial.

The opposition increasingly focuses its attacks on this point. Diet members have asked Takeshita to explain stock deals of his private secretary and his father-in-law. The implication is that they were raising political funds on Takeshita's behalf - a charge he denies.

The other major target is former Prime Minister Yasuhiro Nakasone, during whose rule the Recruit activities took place. The opposition has called for Mr. Nakasone to testify before the Diet, particularly on charges involving NTT and Recruit.

According to various accounts, NTT purchased two US-made supercomputers and leased them to Recruit to start its information-processing business. While premier, Nakasone promoted such purchases in response to US demands that Japan open its market for supercomputers. Critics say Nakasone had explicit knowledge of the NTT deal, hinting he was personally rewarded for it. But two government ministers denied to the Diet on Monday that Nakasone was involved.

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