Non-shutdown of a diesel engine of the 115/123/126 vintage is usually always the mushroom shaped shutoff valve on the back of the injection pump.

There's a vacuum circuit that goes through the ignition switch and in the off position it allows full (about 15-20 lbs) vacuum to the shutoff valve. Inside the shutoff valve there is a diaphragm and when vacuum is applied it pulls a lever inside the injection pump that shuts off the supply of fuel to the motor.

Check to to see if the vacuum hose is still attached to the shutoff valve. If it is, see if it holds vacuum. You can use a vacuum test gauge or (and it tastes very very bad) you can just suck on the hose yourself. Prepare to eat oil if things are really ugly in there you don't want and shouldn't have oil in that line that could indicate vacuum pump failure and that would need to be addressed also.

The most common cause of failure in cars of this vintage is a defective shutoff valve, they're cheap and fairly easy to replace.