The party known as Cocktails and Compliance—so called for mixing alcohol with tax advice—was thrown on a Friday evening in May, in a warehouse turned art gallery in Old San Juan. The host had kept his guest list confidential: It contained the names of hundreds of ultra-wealthy mainland Americans who'd moved to Puerto Rico to avoid paying taxes, most of whom were reluctant to advertise that fact. More than 1,500 mainlanders have established residency here since 2012, when the island rebranded itself as a tax haven, and the annual Cocktails is at the center of their social calendar.

At a high table, polishing off a bourbon on the rocks, sat a compact man in his 60s wearing a black T-shirt and black suede loafers, no socks. This was Mark Gold, the Florida-born kingpin of traffic-ticket contesting. Gold has attended Cocktails and Compliance every year since moving to Puerto Rico in 2016. “I was looking at different tax havens,” he said, “Andorra, Lichtenstein, Monaco. But the problem is, you have to give up your U.S. passport. When I heard about this, it was too good to be true. But it's real. I live in paradise. I live at the Ritz-Carlton. I drive my golf cart to the beach club for breakfast. Then I go to my sunset yoga class on the beach.”

A waiter offered to replace his drink. “Why not?” said Gold.

Only seven months had passed since Hurricane Maria laid waste to the island's power grid, and one month remained until hurricane season returned. A reliable estimate placed the death toll at 4,600; 11,000 still reportedly lacked electricity. Residents were showering with pots and plastic cups. In Manhattan, a federal judge was trying to mediate between the various hedge funds that held billions of dollars of the island's debt. Every so often the MIT-educated governor went on television to extol the virtues of austerity.

In San Juan, the recovery had been notably uneven. Brand-new shopping centers abutted hotels that looked arsonized; traffic lights stared dead-eyed into the street; FEMA was shuttling relief supplies from the waterfront to staging areas. Inside Cocktails and Compliance, however, the atmosphere resembled the aftermath not of a natural disaster but of a corporate convention, with people who usually saw one another in the daytime gradually succumbing to alcohol and dim lighting.

From the valet station, guests had entered a red-carpeted freight elevator, where bartenders poured them sangria. There were reasons to raise a toast. In 2012, Puerto Rico had passed two laws intended to make the island a “global investment destination.” Act 20 allows corporations that export services from the island to pay only 4 percent tax. Act 22 goes much further: It makes Puerto Rico the only place on U.S. soil where personal income from capital gains, interest, and dividends are untaxed.

In order to qualify for Act 22, individuals must prove to the IRS that they have become bona fide residents of Puerto Rico, without “close contacts” on the mainland. (Most native Puerto Ricans are not eligible for the exemption.) At the party, I heard about a man who had lost his tax-free status because the IRS smoked out a wife back in Dallas. I asked Gold, 63, whether his wife had moved along with him. “Now, this is where the colorful-character shit comes in,” he said. “My third wife, she's 25. She was in college. I told her, ‘Babe, you gotta go to college in Puerto Rico, I'm really sorry. We have this opportunity that I cannot pass up. You can stay if you want, but if you stay, we gotta get divorced.’ ”