COLUMN ONE : Debts Put Squeeze on Japanese : Splurging despite a national reputation for saving, many now face aggressive loan collectors and the shame of bankruptcy. The economy feels the strain.

TOKYO —  One evening early last summer, Tomoki Tomita took his wife and four children on a drive into the mountains near his home on the northern island of Hokkaido. The 32-year-old construction worker parked on a quiet road. While his wife held the baby and the other children--ages 3, 5 and 7--slept in the back, he attached a rubber hose to the tailpipe of the car and ran it into the driver-side window.

The family was found the next morning dead from carbon monoxide poisoning.

“I’m taking my children with me,” said a letter in Tomita’s pocket addressed to his brother. “Please take care of the rest.” The apparent source of Tomita’s troubles was $12,000 owed to a number of loan sharks.

The tragedy of the Tomita family is one of the more extreme manifestations of a growing consumer debt problem in Japan that is tearing at families and placing a strain on the faltering Japanese economy.

Bank loans to individuals tripled between 1988 and 1990 to a staggering $150 billion. Japan’s per capita debt grew by more than 50% in the same period to $4,300, surpassing the U.S. level in 1990 of $3,100.

The absence of the kind of comprehensive credit-checking systems available in the United States has enabled many Japanese consumers to borrow far beyond their means. Interest rates considered usury in America and the lack of safeguards against debt collectors’ strong-arm tactics put borrowers in a tough spot.

Last year, suicides related to financial problems reached 1,660, up 31% from the previous year. Thousands of people have abruptly packed their belongings and disappeared to escape creditors. And there are increasing reports in the local media of young women, including housewives, turning to prostitution to pay off debts.

Personal bankruptcies are expected to reach 40,000 this year, nearly quadruple the level just two years ago. Losses from such loans are another burden to Japanese banks already loaded with bad business debt. Consumers saddled with debt also spend less, making it harder for Japan’s sluggish economy to recover.

Unlike Americans, the Japanese are neophytes in consumer credit. Credit cards and consumer loans were rare until the mid-1980s. Previously, loan sharks were about the only source of credit for people without a home or some other asset as collateral.

The consumer debt problem can be traced to the steep rise in land and stock prices in the late 1980s--which is also at the root of Japan’s current banking crisis and many other business failures. Financial institutions were flush with cash, but business borrowers were scarce as corporations raised money more easily by issuing shares amid the stock market boom. So banks, finance companies and even department stores aggressively made loans to consumers.

Department store chains began by offering credit cards at rates as low as 13% but soon found that they could make a bundle offering cash loans at rates up to 39%.

Credit card companies touted their cards as prestige items. “Go, go, young women of Japan,” was the slogan chanted in one television commercial showing Japanese women marching through the fashionable boutiques of Paris.

One television news show tacitly embraced that mentality, broadcasting a segment that featured a credit card duel between a young female clerical worker and a male banker on a busy Tokyo sidewalk. The woman beat the man with 13 credit cards to his 11.

“People adopted a play now, pay later attitude,” says Masaki Masuji, senior economist at NLI Research Institute, an arm of Japan’s largest life insurance company.

While credit checks and spending limits place restraints on American borrowers, Japan has no universal system for determining who is a good credit risk or whether an individual is overextended. Many finance companies refuse to share credit information on their customers for competitive reasons. As a result, consumers dig themselves deeper into debt by borrowing from different sources to pay their original debts.

That is how one young IBM Japan clerical worker said she ended up owing $236,000 on 33 separate credit cards. She says she borrowed cash on some credit cards to pay debts owed on others. By the time she declared bankruptcy, her payments had climbed to $10,000 a month--five times her monthly salary.

While borrowing has soared, Japanese social attitudes remain intolerant of debtors. Respectable companies won’t hire someone with a history of debt problems. And debt-heavy consumers face pressure from relatives who blame them for disgracing the family.

“Any decent person (who fails to pay debts) would commit suicide after causing everybody so much trouble,” says Kimiko Ikeda, whose older sister temporarily moved in with her after losing a home to pay her stepson’s debts. “Isn’t that what you would do in America?”

Many blame the new credit habit on American demands that Japan buy more and save less to reduce the nation’s huge trade surplus. Japan announced in 1985 that it would slash its surplus by promoting more domestic growth and encouraging the purchase of imports.

“It’s America’s fault,” says Shoichi Ebina, a credit counselor. The United States “talks of Japan as a great economy that must consume more, but the average person doesn’t have the ability to buy.”

That isn’t quite accurate. Japan’s per capita savings remain the highest in the world--$45,119 in 1990 compared with $4,200 in the United States.

But most of the savings belong to older Japanese preparing for retirement. The debt problem is mostly among people who speculated in stocks and land and a large number of young Japanese lured with glitzy advertising into borrowing for travel, automobiles and clothes. They don’t have money stashed away.

One national credit counseling organization said 57% of debtors seeking its services are women and 53% of all its clients are under age 30.

Those who can’t pay off their debts often face some tough characters who harass them from morning to midnight, at work and at home.

The owner of a small restaurant says he borrowed $12,500 from a large bank to pay off a gambling debt. When he had trouble paying off the loan, the bank introduced him to smaller credit companies that were more than happy to cover the payments and lend him even more. Soon he had borrowed $80,000 and discovered that his debt had climbed to more than $460,000 owed to 17 loan companies and seven neighbors.

“Gangsters started coming to my shop and hassling customers,” says the man, who asked not to be named. “Eight people would come in and stay for hours splitting one beer.”

The restaurant owner contacted a credit counseling organization that helped him renegotiate his debt.

Reputable lenders say they don’t use thugs to collect loans, but they are known to pressure debtors into finding funds wherever and however possible--family, friends, even theft--in order to get paid back. “It used to be just the loan sharks that were involved, now the banks are working close together with the sharks,” Ebina says.

Some disreputable lenders pressure women to work in pornographic films or as prostitutes, according to local media reports. A recent article in a weekly magazine quoted a woman who says she agreed to be the mistress of a wealthy businessman for several months in exchange for cancellation of her debts.

Many debtors run away from home rather than face creditors. Satoshi Sasaki, 31, says he borrowed $4,100 a few years ago to tide himself over until payday. But within a few months, he owed $8,000 because of a 30% loan fee charged by the lender, plus huge interest charges.

When the lenders couldn’t get him to pay on time, they badgered his parents and called him at work, Sasaki says. He ran from home, taking a job at a games parlor.

At the parlor, Sasaki met his current wife. She had a similar history. She, too, sank deeper in debt when forced to borrow from Peter to pay Paul. One group of creditors, she says, pressured her to use her department store credit cards to buy thousands of dollars worth of jewelry and camera equipment, pawn it at a 50% discount and use the cash to pay them back.

“You just want to jump in front of a train and die,” she says. “No matter how you try, you can’t pay back. You get to feeling hopeless.”

The couple recently came out of hiding to get married and clear their debts. “We just want to live a normal life now,” says Sasaki, who is getting credit counseling help.

In spite of high legal costs and taboos against publicizing one’s debt, a growing number of Japanese are turning to the courts for help. Each Saturday, Japan’s leading business newspaper prints a comprehensive list of people who have filed for bankruptcy. These days, the list covers several pages of fine print.

Although Japan’s expected 40,000 personal bankruptcy filings this year are few compared to the 800,000 filed annually in the United States, the average debt cleared by Japan’s bankruptcy courts is about $42,000, several times the U.S. average.

“The problem is that banks made it too easy to borrow money,” says Kenji Utsunomiya, a lawyer whose book, “A Basic Introduction to Personal Bankruptcy,” has been instrumental in persuading borrowers to resort to the courts. One reason lenders haven’t been more tightfisted in their credit practices, Utsunomiya says, is that high interest rates made the business so profitable.

Although rules prohibit lenders from charging more than 39% annually, they are not enforced. When Tei Ichikawa, 65, borrowed $8,000 to help pay for a fishing trip, he was surprised to find 15% of the money skimmed off the top in fees. A second company that helped pay off his earlier debts charged him 10% a month. Only after filing bankruptcy did he discover that such charges were illegal.

Loan sharks have made easy lending an art form. One lender used a classified ad in a sports newspaper to boast of “instant” loans, promising that consumers could have $4,000 deposited in their bank account within five minutes simply by providing their telephone numbers, addresses and bank account numbers.

Only recently have lenders taken serious steps to better control the use of credit. “The industry has grown a lot and we have to change,” says an officer of the Credit Card Industry Assn. That will require, he says, sharing more credit information, boosting the number of credit-checking machines at retail stores and lowering spending limits.

The Japanese government is also trying to bring the consumer debt problem under control. The Ministry of Education is introducing classes on consumer spending in secondary schools in hopes of teaching the responsible use of credit.

The Ministry of International Trade and Industry says it will tighten its oversight of finance companies. And consumer groups are educating potential borrowers--even publishing comic books--on how to plan family finances and recognize lenders’ ploys.

A legitimate debt-collection industry is also beginning to take shape as an alternative to strong-arm tactics now commonly used. Greg Kaufman, who works for Consumer Credit Clearance, says the company is doing a booming business collecting debts for banks that don’t want their names associated with heavy-handed credit collection activities. Kaufman says the sense of responsibility toward repaying debt is still very strong in Japan and that a stern letter will usually lead to repayment of debts.

The restaurant owner who first borrowed to pay off his gambling debt has already paid $166,000 in interest. He says he will spend the rest of his life paying off the remaining $333,000.

“Now I work without vacation to pay off my debts. I work 6 a.m. to 11 p.m. at night,” he says. “My wife tells me every day, ‘It’s your own fault.’ ”

Times researcher Megumi Shimizu contributed to this story.