"Embargo? What embargo?" he grins, blowing smoke at the 37-year-old U.S. policy meant to bar him from the island. "Why keep me out of paradise?"

He's not alone. Drawn by its exotic culture and socialist mystique, more and more Americans are heading to Cuba. Some, like George, are "trading with the enemy," despite the threat of a $55,000 fine for defying the embargo. Others go with U.S. Treasury Department licenses that let them travel for educational, cultural or humanitarian purposes.

"Since 1994, there's been a 10% annual increase of authorized U.S. travelers but a 20% increase of illegal ones," says John Kavulich, head of the New York-based U.S.-Cuba Trade and Economic Council.

"We've seen a huge growth of interest since the pope's visit 14 months ago."

As many as 140,000 Americans hit Cuba's shores last year, up to 30,000 of them without U.S. government permission, Kavulich estimates.

Interest has been boosted by President Clinton's recent announcement of relaxed restrictions: more charter flights and people-to-people contact and permission for the Baltimore Orioles to play the Cuban National Team on Sunday .

"Calls are pouring in every day," says Bob Guild of Marazul Tours, which arranges legal visits for Americans. "Last year we took 18,000 travelers, a 50% increase over 1997."

The political radicals of decades ago are now more likely to be the culturally curious, intrepid adventurers or hedonists on the trail of cheap rum, fine cigars and casual sex.

As in pre-revolutionary days, notorious for their decadence, Cuba is still heady with the intoxicating allure of forbidden pleasures, ironically flourishing in this last communist outpost of the Western world. And the USA's current cigar craze, Che chic and salsa mania have only fueled its appeal.

"I wanted to see Cuba before the embargo was lifted," says Corky from Tacoma, Wash., who flew here with two buddies via Vancouver, British Columbia. "It's the lure of the taboo."

Daiquiris in hand, they're catching the sun's last rays from the rooftop pool of the glitzy new 281-room Golden Tulip Parque Central. A standout amid Old Havana's ornate but crumbling colonial buildings, the Dutch-run hotel could well be in Hong Kong or Houston.

It's just the latest example of how Cuba is rolling out the welcome mat, romancing tourists with new resorts, restaurants and nightspots. To keep the island afloat without the Soviet subsidies of a decade ago, Fidel Castro has raised a banner of tourism or death.

Once scorned by the revolution, tourism has soared to first place among the nation's industries. It generated $1.8 billion last year, thanks to 1.4 million visitors, more than four times the total of 10 years ago.

Cuba's annual tourism growth of nearly 20% is the highest in the Caribbean, says Mario Sori Montes of Cubanacan, the state-run tourism agency. He predicts 2 million arrivals next year and a whopping 10 million in 2010 -- even if the embargo isn't lifted.

Sixty-five airlines fly here; British Airways starts next month. There is even a Hard Rock Cafe on the horizon, aiming to put Havana on the restaurant-as-theme-park map.

Indeed, the capital is awash in foreigners. Europeans, Canadians and South Americans clog the narrow walkways of Old Havana, wedging themselves into Ernest Hemingway's old watering holes ("My mojito in La Bodeguita, my daiquiri in El Floridita," he wrote on a note). Tour buses cruise Parisian boulevards, past mansions built by sugar barons. Nightclubs swarm with vacationers in search of a wickedly good time.

At the Hemingway Marina, luxury yachts from abroad line the docks, at least a dozen flying the Stars and Stripes.

"I came to find the enemy, but the enemy is in Washington," says Tom, an American boat owner, pulling his spandex-clad Cuban girlfriend closer.

As it is retrofitted for tourism, Havana is a web of scaffolding and cranes. Foreign investors and UNESCO money -- Old Havana is now a World Heritage Site -- are restoring the scarred colonial gems to their original grandeur. Some have been reborn as boutique hotels, like the tony Ambos Mundos, where Hemingway wrote For Whom the Bell Tolls.

Like the hotel, the city reeks with intrigue and nostalgia. And it's not just the vintage American cars that seem shrink-wrapped in time.

The bar at the legendary Hotel Nacional is ever thick with tobacco smoke and dealmakers in a cacophony of languages. The Malecon seawall that edges the city still draws romantics and dreamers, seduced by the taunting presence of Miami just 90 miles across the great moat of the Caribbean Sea. And everywhere the air is heavy with the scent of Graham Greene and the Mambo Kings.

Day and night, the whole city dances to rhythms right out of Africa. Throbbing congas pulsate from shadowed doorways, romantic rumbas pour from cafes, and high-voltage salsa sets hips grinding.

Havana may be shabby, but its sensuality is intact.

As it always has, music celebrates the irrepressible spirit of the people, who have suffered bitter privations for the past decade. Much to Castro's chagrin, this has turned them into dollar-hungry hustlers: Well-educated Cubans now drive gypsy cabs, rent rooms to tourists and hawk black-market cigars -- or sex.

Officials blame tourism for the return of prostitution and street crime, wiped out by the revolution. Last year they planted black-bereted special police on every corner in the tourist areas and passed strict anti-crime laws. Prostitutes don't prowl the streets as before but still turn up in bars and restaurants on the arms of paunchy, aging foreigners.

Implausibly, English is now the island's lingua franca of tourism and dollars the coin of the realm. Yet the state tries to insulate Cubans from "capitalist" contamination by barring them from hotels and resort areas. The result? A virtual tourism apartheid.

"When you open a window, it lets in fresh air," says Cubanacan's Sori Montes. "But also pollution."

No place is more of a tourist ghetto than Varadero Beach, a Cancun wannabe just two hours from Havana. Splashy hotels with 9,000 rooms -- two-thirds as many as on the entire island of Jamaica -- line a 12-mile strand as clean and white as Cuban sugar. But even here, the dollar-desperate (pesos are almost worthless) roam the sands with whispers of "Want cheap lobster dinner?" as they tout home-based restaurants called paladares.

"It's hard to see the people suffer, they're so warm and friendly and open," says a tan Canadian on the beach with his American girlfriend.

As he orders another Cuba libre, he adds, "This place really gets under your skin."

Legend's stop: Hemingway's note still hangs in La Bodeguita. The writer lived in Cuba for the better part of 20 years. The 1963 Trading With the Enemy Act doesn't outlaw travel to Cuba per se, but it does prohibit most U.S. visitors from spending money there.

Civil penalties go as high as $55,000, but most have been $1,500 to $5,000 each. Since 1994, the Treasury Department's Office of Foreign Assets Control (OFAC) has collected nearly $1.9 million for civil violations in 379 separate cases.

OFAC licenses authorize some Americans to spend up to $100 a day in Cuba; they include journalists, official government visitors, those on humanitarian, educational or cultural tours, and Cuban-Americans visiting close family members, by far the largest group. Fully hosted visitors, whose travel-related expenses are paid by non-Americans, are also permitted.

Information: 202-622-2480 or www.treas.gov/ofac.

GETTING THERE: Since regular commercial carriers do not fly to Cuba from the USA, most people go through third countries such as Mexico, Canada or the Bahamas. Authorized charter flights from Miami can be booked by some tour companies. Charters may serve additional U.S. cities under new regulations to be finalized soon.

Slipping into Cuba illegally is all too easy. American passports aren't stamped upon entry. U.S. immigration officials don't always ask travelers from such popular transit ports as Nassau, Cancun or Toronto whether they've visited a third country during their trips. Since all transactions in Cuba are in cash -- no American credit cards or traveler's checks are accepted -- there's no expense paper trail.

To book flights on Cubana de Aviacion from Nassau (about $186 round trip), contact Majestic Tours, 242-328-0387; from Cancun (about $175), contact Divermex, 011-52-98-842325; and from Toronto (about $370), contact Cubana, 416-967-2822.

TOUR GROUPS: Here's a sampling of companies that can arrange travel to Cuba.

Marazul Tours. This New Jersey-based company organizes special-interest tours and individual travel for those with OFAC licenses. Information: 800-223-5334 or www.marazultours.com.

Center for Cuban Studies. This nonprofit group, based in New York, specializes in authorized academic/educational tours, but it can also arrange individual travel. Information: 212-242-0559 or www.cubaupdate.org.

Global Exchange. This non profit educational organization, based in San Francisco, has taken about 5,000 visitors to Cuba on educational tours over 10 years. It's not licensed to do so, but no one in its groups has ever been fined or detained. Information: 415-255-7296 or www.globalexchange.org.

Last Frontier Expeditions. An Aruba-based firm with offices in Boulder, Colo., it arranges hosted sports tours for Americans. Information: 303-530-9275.

Caribbean Music and Dance. Based in St. Louis, this group specializes in OFAC-licensed music and dance tours. Information: 314-542-3637.

Wings of the World.With offices in Toronto and Buffalo, this Canadian company caters to U.S. travelers with fully hosted tours. Information: 800-465-8687.

Hola Sun Holidays. Trips organized by this major Toronto tour operator, which specializes in Cuba, must be booked through a Canadian travel agent. Information: www.holasunholidays.com.

INFORMATION: The U.S.-Cuba Trade and Economic Council, 212-246-1444 or www.cubatrade.org.