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It is solved when Nancy Drew suspect Alex Upgrove was in the ship at the time when Nancy, Bess and her cousin George were inspecting the boat one night. Alex's friend was the most likely one to held Nancy and George in a short-term fire while Alex has finally discover the treasure (that was hidden under some floorboards). Since it was Mardi Gras week, the day of the parade Alex was on a float with the real treasure of the showboat (chest full of gold),which made a good escape plan to catch him. So as he secretly left through the crowd to make a run for it, Nancy finally catches him along with the police. In order from telling if it was Alex or not (he was wearing a heavy pirate costume), Nancy suspected from a clue earlier in the story of a piece of decorative paper that Alex threw out the car window, which was the same decorations on his float

At the end Alex has never loved Donna Mae, and instead Donna Mae returned to her true love, Charles, after hearing Alex was a fake and only insisting of engaging to her for her wealth. Alex went to jail and Nancy continued to enjoy Mardi Gras <333

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