Business Notes JAPAN

The Japanese call it kinken-seiji, or money politics -- the widespread if sleazy practice in which businessmen curry favor with politicians by giving them insider stock tips or cozy deals. Last week the biggest such scandal in years rocked Japan after the daily Asahi Shimbun disclosed a list of 76 political staffers, journalists and others who allegedly earned millions of dollars investing in the stock of a fast-growing real estate company called Recruit Cosmos. On the list were top members of the ruling Liberal Democratic Party (L.D.P.), including aides to both Prime Minister Noboru Takeshita and his predecessor, Yasuhiro Nakasone.

Recruit Cosmos acknowledged that it offered discounted shares of its stock to the well-placed investors in 1984, two years before the company went public. The stock's price soared as soon as it went on the market, enabling the early investors to reap large profits. Under Japanese law the practice was technically legal, yet the deals struck many Japanese as highly unethical.

The uproar prompted the resignations of Hiromasa Ezoe, chairman of Recruit's parent company, and Ko Morita, president of the leading financial daily, Nihon Keizai Shimbun; who admitted that he too was a beneficiary. The biggest ; fallout for the L.D.P. could come later this summer in parliament, where Takeshita's proposal for tax reform is likely to face an emboldened opposition.