FORM  10-QSB

                                 UNITED STATES
                       SECURITIES  AND  EXCHANGE  COMMISSION
                              Washington,  DC  20549

                                   (Mark  One)

 [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
                                   ACT  OF  1934

                For  the  quarterly  period  ended  September  30,  2004

                                       OR

     []  TRANSITION  REPORT  PURSUANT  TO  SECTION 13 OR 15(D) OF THE SECURITIES
                              EXCHANGE  ACT  OF  1934

        For  the  transition  period  from                   to
                                           ------------         ----------

                         COMMISSION  FILE  NUMBER  0-24829

                                 FTS  GROUP,  INC.
                                -----------------

             (Exact  name  of  registrant  as  specified  in  its  charter)


          Nevada                                     84-1416864
-------------------------------             ---------------------------
(State  or  other  jurisdiction  of      (I.R.S.  Employer  identification
incorporation  or  organization)                 No.)

                  1049c  Oxford  Valley  Rd.,  Levittown,  PA  19057
                     (Address  of  principal  executive  office)


                                 (215)  943-9979
                                 --------------
              (Registrant's  telephone  number,  including  area  code)

     Check  whether the registrant (1) filed all reports required to be filed by
     Section  13  or 15(d) of the Exchange Act during the past 12 months (or for
     such shorter period that the registrant was required to file such reports),
     and  (2) has been subject to such filing requirements for the past 90 days.
     Yes  [X]  No  [  ]

As of September 30, 2004, the Issuer had 31,331,980 shares of common stock, par
value  $0.001,  outstanding


                                FTS  GROUP,  Inc.

                          PART  I  FINANCIAL  INFORMATION

ITEM  1.  FINANCIAL  STATEMENTS

<TABLE>
<CAPTION>

                         FTS GROUP, INC. AND SUBSIDIARY
                              CONSOLIDATED BALANCE SHEET
                               September 30, 2004
                                   (UNAUDITED)



<S>                                                          <C>
                                  ASSETS

CURRENT ASSETS
  Cash. . . . . . . . . . . . . . . . . . . . . . . . . . .  $     8,302
  Accounts receivable, net. . . . . . . . . . . . . . . . .      105,042
  Inventory . . . . . . . . . . . . . . . . . . . . . . . .       36,207
  Prepaid Expense . . . . . . . . . . . . . . . . . . . . .       85,044
                                                             ------------
    Total current assets. . . . . . . . . . . . . . . . . .      234,595
                                                             ------------

PROPERTY AND EQUIPMENT, NET . . . . . . . . . . . . . . . .       47,516
                                                             ------------

OTHER ASSETS
  Investment in private entity. . . . . . . . . . . . . . .       15,000
  Deposits. . . . . . . . . . . . . . . . . . . . . . . . .       17,539

TOTAL OTHER ASSETS. . . . . . . . . . . . . . . . . . . . .       32,539


                                                             $   314,650
                                                             ============
                 LIABILITIES AND STOCKHOLDERS' (DEFICIT)

CURRENT LIABILITIES
  Accounts payable and accrued expenses . . . . . . . . . .  $   154,101
  Notes payable  - related parties. . . . . . . . . . . . .       56,441
  Note Payable Other                                              87,250
                                                             ------------
    Total current liabilities . . . . . . . . . . . . . . .      297,792
                                                             ------------

NOTES PAYABLE . . . . . . . . . . . . . . . . . . . . . . .      100,989

CONVERTIBLE DEBENTURES. . . . . . . . . . . . . . . . . . .      172,704
                                                             ------------

STOCKHOLDERS' (DEFICIT)
  10% Convertible preferred stock, Series A, $0.01 par
    value, 150,000 shares authorized, 0 shares issued
    and outstanding . . . . . . . . . . . . . . . . . . . .            -
  Preferred stock, $0.01 par value, 4,850,000 undesignated
    shares authorized . . . . . . . . . . . . . . . . . . .            -
  Common stock, $0.001 par value, 150,000,000 shares
    authorized, 31,331,980 shares issued and outstanding. . .     31,332
  Additional paid in capital. . . . . . . . . . . . . . . .    7,264,740
  Deferred compensation . . . . . . . . . . . . . . . . . .
  Accumulated (deficit) . . . . . . . . . . . . . . . . . .   (7,552,907)
                                                             ------------

                                                                (256,848)
                                                             ------------

                                                             $   314,650
                                                             ============


SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
</TABLE>

<TABLE>
<CAPTION>

                                               FTS GROUP, INC. & SUBSIDIARY
                                           CONSOLIDATED STATEMENTS OF OPERATIONS
                                                        (UNAUDITED)


<S>                                                  <C>                   <C>                  <C>           <C>

                                                                THREE MONTHS ENDED                   NINE MONTHS ENDED
                                                      30-Sep-04              30-Sep-03            30-Sep-04     30-Sep-03
                                                     --------------------  -------------------  ------------  ------------


 REVENUES
   Sales. . . . . . . . . . . . . . . . . . . . . .  $           221,084   $           26,797   $   510,991   $    43,111
                                                     --------------------  -------------------  ------------  ------------

 COST OF GOODS SOLD . . . . . . . . . . . . . . . .              138,074               19,018       312,689        29,185
                                                     --------------------  -------------------  ------------  ------------

 GROSS PROFIT . . . . . . . . . . . . . . . . . . .               83,010                7,779       198,302        13,926
                                                     --------------------  -------------------  ------------  ------------

 GENERAL AND ADMINISTRATIVE EXPENSES
    Non-cash stock compensation . . . . . . . . . .               52,675               30,650       164,894       224,650
    Purchased development costs . . . . . . . . . .                    -                    -             -        23,500
    Selling, general and administrative expenses. .              465,960              106,459     1,571,120       303,692
                                                     --------------------  -------------------  ------------  ------------
                                                                 518,635              137,109     1,736,014       551,842
                                                     --------------------  -------------------  ------------  ------------

 LOSS FROM OPERATIONS . . . . . . . . . . . . . . .             (435,635)            (129,330)   (1,537,712)     (537,916)
                                                     --------------------  -------------------  ------------  ------------

OTHER INCOME (EXPENSE)
   Interest expense . . . . . . . . . . . . . . . .              (58,602)              (3,547)      (77,704)       (6,746)
                                                                                            -                          -
  Impairment of Long Lived Assets                                (38,000)                          (102,000)
                                                     --------------------  -------------------  ------------  ------------
                                                                 (96,602)              (3,547)      (179,704)      (6,746)
                                                     --------------------  -------------------  ------------  ------------

NET LOSS. . . . . . . . . . . . . . . . . . . . . .  $          (532,227)  $         (132,877)  $(1,609,711)  $  (544,662)
                                                     ====================  ===================  ============  ============

PER SHARE INFORMATION:
WEIGHTED AVERAGE SHARES OUTSTANDING
  (BASIC AND DILUTED) . . . . . . . . . . . . . . .           29,643,160           17,631,910    25,676,509    17,273,721
                                                     ====================  ===================  ============  ============

NET LOSS PER COMMON SHARE (BASIC AND DILUTED) . . .  $             (0.02)  $            (0.01)  $     (0.06)  $     (0.03)
                                                     ====================  ===================  ============  ============

      SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
</TABLE>

<TABLE>
<CAPTION>

                                    FTS GROUP, INC. AND SUBSIDIARY
                                CONSOLIDATED STATEMENTS OF CASH FLOWS
                                             (UNAUDITED)


<S>                                                        <C>                   <C>

                                                                      Nine Months Ending
                                                           September 30, 2004    September 30, 2003
                                                           --------------------  --------------------


OPERATING ACTIVITIES
    Net cash (used in) operating activities . . . . . . .  $        (1,830,472)  $          (271,776)
                                                           --------------------  --------------------

INVESTING ACTIVITIES
    Net cash (used in) investing activities . . . . . . .              (11,226)              (18,074)
                                                           --------------------  --------------------

FINANCING ACTIVITIES
    Net cash provided by financing activities . . . . . .            1,843,113               292,500


CASH AT BEGINNING OF PERIOD . . . . . . . . . . . . . . .                6,887                   219
                                                           --------------------  --------------------

Net cash increase (decrease). . . . . . . . . . . . . . .                1,415                 2,650

CASH AT END OF PERIOD . . . . . . . . . . . . . . . . . .  $             8,302   $             2,869
                                                           ====================  ====================

NON  CASH  TRANSACTIONS
          CONVERSION  OF CONVERTIBLE DEBENTURE                        $272,413                 $  0



          SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
</TABLE>


                                FTS  GROUP,  INC.
                          NOTES  TO CONSOLIDATED FINANCIAL  STATEMENTS
                               SEPTEMBER  30,  2004
                                   (UNAUDITED)


FTS  GROUP,  INC.

                   Notes  to  Consolidated  Financial  Statements
(1)     GENERAL
        -------

FTS  Group,  Inc.  (the "Company"), formerly FTS Apparel, Inc., was incorporated
under  the  laws  of  the  State  of  Nevada.  The  Company  is  engaged  in the
acquisition  and  development of a chain of full service retail wireless stores.
The Company's primary business is the marketing, sale and activation of cellular
and satellite handsets, cellular accessories and other related wireless products
such  as  Wi-Fi service and related access equipment for residential or business
purposes.

Principles  of  Consolidation

The  consolidated  financial  statements include the accounts of the Company and
its  wholly-owned subsidiary:  FTS Wireless, Inc.  All significant inter-company
transactions  and  balances  have  been  eliminated  in  consolidation.

BASIS  OF  PRESENTATION

The  accompanying  unaudited  interim financial statements have been prepared in
accordance  with  Generally Accepted Accounting Principles ("GAAP")in the United
States of America for interim financial information and with the instructions to
Form  10-QSB.  Accordingly  the  accompanying  financial  statements and related
footnotes  have  been condensed and do not contain certain information that will
be  included in the Company's annual financial statements and footnotes thereto.
In  the  opinion  of management, all adjustments (consisting of normal recurring
adjustments)  considered  necessary  for a fair presentation have been included.

Results for the three months and nine months period ended September 30, 2004 are
not  indicative of the results that may be expected for the year ending December
31,  2004.

As  contemplated  by  the  Securities  and Exchange Commission, these statements
should be read in conjunction with consolidated Financial statements and related
footnotes thereto included in the Company's annual report on Form 10-KSB for the
year  ended  December  31,  2003.

(2)     USE  OF  ESTIMATES
        ------------------

The preparation of financial statements in conformity with accounting principles
generally  accepted  in the United States of America requires management to make
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities  and  disclosure of contingent assets and liabilities at the date of
the  financial  statements  and  the  reported  amounts of revenues and expenses
during  the  reporting  period.  Actual results could vary from those estimates.

(3)     Recently  Issued  Accounting  Pronouncements
        --------------------------------------------

In  January  2003,  the  FASB  issued  Interpretation  No. 46, "Consolidation of
Variable  Interest  Entities", an interpretation of Accounting Research Bulletin
No.  51  "Consolidated  Financial  Statements."  FIN  No.  46  prescribes how to
identify variable interest entities and how an enterprise assesses its interests
in a variable interest entity to decide whether to consolidate that entity. This
interpretation requires existing unconsolidated variable interest entities to be
consolidated  by  their primary beneficiaries if the entities do not effectively
disperse  risks among parties involved. FIN 46 was scheduled to be effective for
variable interest entities created after January 31, 2003. On December 24, 2003,
the  FASB  published  a  revision to FIN No. 46 ("FIN No. 46(R)"). FIN No. 46(R)
clarifies certain provisions of FIN No. 46 and exempts certain entities from its
requirements.  For  interests  in  variable  interest entities acquired prior to
January 31, 2003, the provisions of FIN No. 46(R) have been applied on March 31,
2004.  The  Company  determined the adoption of FIN No. 46 and FIN No. 46(R) did
not  have  a material effect on its financial position or results of operations.

(4)     GOING  CONCERN
        --------------

The Company's financial statements are presented on a going concern basis, which
contemplates  the  realization  of assets and satisfaction of liabilities in the
normal  course of business. The Company's ability to continue as a going concern
is  contingent  upon  its ability to expand its operations and secure additional
financing.  The  Company  has  a  $6 Million Equity Line of Credit in place with
Dutchess  Private Equities Fund, LP and is pursuing additional financing options
to  execute  its  operating  and expansion plans. Failure to secure financing or
expand  operations  may  result  in  the Company not being able to continue as a
going  concern.  The  financial  statements  do  not  include any adjustments to
reflect  the possible future effects on the recoverability and classification of
assets or the amounts and classification of liabilities that may result from the
possible  inability  of  the  Company  to  continue  as  a  going  concern.

(5)     STOCK  FOR  SERVICES
        --------------------

During  February  2004,  the Company issued 3,785,000 shares of common stock for
services  pursuant to a Form S-8 registration statement.  The shares were valued
at  their  fair  market value on the date it was agreed that the shares would be
issued.  The non-cash stock compensation expense of $643,450 has been charged to
operations  during  the  period and reported under SG&A.

During  the  quarter ended June 30, 2004, the Company issued 2,122,247 shares of
restricted  common  stock  for  compensation  for  services. 625,000 shares were
issued  to  the Chief Executive Officer as compensation for fiscal 2004, 250,000
shares  were  issued  to  the  Chief Financial Officer for accrued compensation,
250,000  shares  were  issued  to our former Chief Operating Officer and 200,000
shares were issued for previously accrued compensation the remaining shares were
issued  for  consulting  services.  The  non-cash  stock compensation expense of
$297,900  has  been  charged to operations during the second quarter of 2004 and
reported  under  SG&A.

During the quarter ended September 30, 2004, the Company issued 1,153,500 shares
of  restricted  common  stock  for  consulting  services.

(6)     RELATED  PARTY  TRANSACTIONS
        ----------------------------

During  the  period  ending  September  30,  2004  and the subsequent period the
Company  received loans from two of its officers and directors totaling $192,500
with  an  interest  rate of 20% per annum. The funds were primarily used to fund
Acquisitions  and  to  pay  loans  with  Dutchess  Private  Equities  Fund.

(7)     FINANCING  ACTIVITIES
        ---------------------

During the period ended September 30, 2004, the Company issued 775,000 shares to
Dutchess  Private  Equities under the previously disclosed convertible debenture
financing  filed  with the Securities and Exchange Commission on form 8K on July
21,  2003  thereby reducing the outstanding amount by $44,453.During the quarter
ended  September  30, 2004 the Company received short term loans of $75,000 from
Dutchess  Private  Equities  Fund and $84,000 from a private investor bearing an
interest  rate  of  20%.

Also  during  the  quarter  ended September 30, 2004, the Company sold 1,150,000
shares  of  restricted  common  stock  to two individuals in a private placement
valued  at  $0.08 per share. The Company issued 240,000 restricted common shares
for  private  placements  completed  previously  at $0.10 per share. The Company
issued  581,200 restricted common shares in a private placement at $0.08 to four
individuals.

(8)     ACQUISITIONS  AND  COMMITMENTS
        -------------------------------

During  the  period  ended  September  30,  2004,the  Company  completed  the
acquisition  of a location in Tampa, Fl. from Cell Station dba "Choice Cellular"
for  $70,000  in  cash.  The  Company  leased a new location in the Tampa market
during  the  period  and filed the lease agreement on form 8-K. The new location
will  be used as the Company's new corporate headquarters, a new retail wireless
location  and  a  call  center for up to fifteen seats. The Company is currently
negotiating  renewals  of  its  liability  insurance  commitments  and workman's
compensation  policies.

(9)     ACCOUNTS PAYABLE
       -----------------

As  of  the  period  ended September 30, 2004 the company had outstanding unpaid
payroll  and  sales  tax  liability  including  penalties  and  interest  in the
approximate  amount  of  $37,700


(10)     SUBSEQUENT  EVENTS
        ------------------

Subsequent to September 30, 2004 the Company closed an under-performing location
in  Tampa, Fl. after the lease of $2,000 per month expired. In October 2004, the
Company  purchased  a  new location from Wireless Unlimited, Inc. with a monthly
rental  payment commitment of approximately $700 for $40,000 in cash. Subsequent
to  September  30,  2004  a  total of $23,768 of debentures have been converted.


ITEM  2.  MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OR  PLAN  OF  OPERATION

     The  following  discussion  and  analysis  covers  material  changes in our
financial  condition  since the year ended December 31, 2003 and a comparison of
the results of operations for the three and nine months ended September 30, 2004
to  the  same  period  in  2003.  This discussion and analysis should be read in
conjunction  with  "Management's  Discussion  and Analysis or Plan of Operation"
included  in  our  Form  10-KSB  for  the  year  ended  December  31,  2003.

     This report on Form 10-QSB contains forward-looking statements that involve
risks  and  uncertainties.  We  generally  use  words  such as "believe," "may,"
"could,"  "will,"  "intend,"  "expect,"  "anticipate,"  "plan,"  and  similar
expressions  to  identify forward-looking statements. You should not place undue
reliance  on  these  forward-looking statements. Our actual results could differ
materially  from  those  anticipated  in the forward-looking statements for many
reasons,  including  the  risks  described  below  and elsewhere in this report.
Although we believe the expectations reflected in the forward-looking statements
are  reasonable,  they  relate  only  to  events  as  of  the  date on which the
statements  are made, and our future results, levels of activity, performance or
achievements  may not meet these expectations. We do not intend to update any of
the  forward-looking statements after the date of this document to conform these
statements  to  actual  results  or  to  changes  in our expectations, except as
required  by  law.


OVERVIEW


Historically  and  through  the  year  ended  December  31,  2001,  we  operated
exclusively  in  the  apparel  industry.  In  January  2002,  we  experienced  a
management  change.  Our  business  now  focuses  on  developing,  investing  in
and  acquiring  cash-flow  positive  businesses  and  viable  business  projects
primarily those in  the  wireless  and  technology  industries. As of the end of
September  2004,  we  operated  a total of 8 retail wireless locations, we lease
three locations in Tampa, FL, one in St. Petersburg, FL, one in Brandon, FL, one
in Lutz, FL, one in  Oldsmar, FL and one in Suburban Philadelphia, Pennsylvania.

CRITICAL  ACCOUNTING  POLICIES  AND  ESTIMATES

In  December,  2001,  the  SEC issued a cautionary advice to elicit more precise
disclosure  about  accounting  policies management believes are most critical in
portraying  our  financial  results and in requiring management's most difficult
subjective  or  complex  judgments.  The  preparation of financial statements in
conformity with accounting principles generally accepted in the United States of
America  requires  management  to  make  judgments  and  estimates.

We  believe  the  following  critical  accounting  policies  affect  our  more
significant  judgments and estimates used in the preparation of our consolidated
financial  statements.

REVENUE  RECOGNITION:

Net  revenues  from  wholesale product sales are recognized upon the transfer of
title  and  risk  of  ownership  to customers. Allowances for estimated returns,
discounts  and  doubtful accounts are provided when sales are recorded. Shipping
and  handling  costs  are  included  in  cost  of  sales.

We  recognize  revenue from  the  sale  and  activation of wireless handsets and
related accessories.

GOODWILL  AND  INTANGIBLE  ASSET  IMPAIRMENT:

We  periodically  review the  carrying  amount of property, plant and equipment.

Goodwill and Intangible Asset Impairment: We determine whether current events or
circumstances  warrant  adjustments to carrying amounts of long lived assets. If
an  impairment  adjustment  is  deemed  necessary,  such loss is measured by the
amount  that  the  carrying  value  of  such  assets  exceeds  their fair value.
Considerable  management  judgment  is  necessary  to estimate the fair value of
assets;  accordingly,  actual  results  could  vary  significantly  from  such
estimates.  Assets to be disposed of are carried at the lower of their financial
statement  carrying  amount  or  fair  value  less  costs  to  sell.

Results  of  Operations

     We  generated  consolidated  net  revenues  of $221,084 for the three month
period ended September 30, 2004, resulting in an increase of approximately 725%,
as  compared to $26,797 for the three month period ended September 30, 2003. The
increase  in revenues for this quarter when compared to the same quarter of 2003
is  primarily  due  to the acquisition of four new retail wireless locations and
the  related  increase  of  wireless  activation  levels.

     We  incurred  Cost  of  Sales  of $138,074 for the three month period ended
September  30,  2004,  as  compared  to $19,018 for the three month period ended
September  30,  2003.  Our  Cost of Sales increase is again primarily due to the
acquisition  related growth of our wireless business and the associated increase
in  wireless  handset  sales.

     For  the  three  months  ended  September 30, 2004, we reported $518,635 of
Selling, general and administrative expenses, compared to $137,109 for the three
months  ended  September  30,  2003,  an  increase  of  $381,526 the increase is
primarily  related  to  acquisition  related  costs  in  addition  to  increased
operating  overhead  and  staffing  levels  of  our  retail  wireless  business.

     For  the  three  months ended September 30, 2004, we realized a net loss of
($532,227)  or  ($.02) per share, on revenue of $221,084. This compares to a net
loss  of  ($132,877)  or  ($.01)  per share, on revenue of $26,797 for the three
months ended September 30, 2003. Accordingly, our net loss increased by $399,350
due  to  an increase in financing costs, consulting fee's as well as an increase
in  overall  operating  expenses  related  to  the increased number of locations
operated  during  the  period.

     We  continue to execute our strategic roll-up program and actively seek out
accretive  acquisition  candidates  to  further  develop  our diversified retail
wireless  business.  During  the  third  quarter,  we  closed  the Fowler Avenue
location  of  Choice Cellular of Tampa, FL. Also during the quarter we secured a
lease  for  a  new  wireless  location  that  when  open  will also serve as our
corporate  headquarters,  a retail distribution outlet and a call center with up
to  15  persons.

Liquidity  and  Capital  Resources

     As  of  September  30,  2004,  our Current Assets were $234,595 and Current
Liabilities  were  $268,792.  Our current liabilities consist mainly of accounts
payable,  accrued  expenses  and  loans from related parties and funds owed to a
private  investor.  Our  Stockholder's  Deficit  at  September  30,  2004  was
($241,195).

     At  September  30,  2004,  we  had  cash  available  of  $8,302,  accounts
receivable  of  $105,042,inventory  valued  at  $36,207,  property and equipment
valued  at $47,516, prepaid expenses of $85,044, investments  valued at $15,000,
deposits  of  $17,539  for  a  total  of  $314,650.

     We  had a net usage of cash used in operating activities for the nine month
period  ended  September  30,  2004  and  2003  of  $1,830,478  and  $271,776,
respectively.  We  had net cash provided by financing activities of for the nine
month  period  ended  September  30,  2004  and 2003 of $1,843,113 and $292,500,
respectively.

     We  believe that our continued existence depends on our ability to make our
wireless  operations  profitable  and  our  ability to raise additional capital.
Accordingly,  the  notes  to our unaudited, interim financial statements express
substantial  doubt  about  our  ability  to  continue  as  a  going  concern.

     We  are not aware of any material trend, event or capital commitment, which
would  potentially  adversely  affect  liquidity.  In  the  event  such  a trend
develops,  we  believe  that  we will have sufficient funds available to satisfy
working  capital needs through our Equity Line of Credit with Dutchess and funds
from  potential  future  equity  sales.

Financing  Activities

During  the  period  ending  September  30,  2004,  we  issued 775,000 shares to
Dutchess  Private  Equities pursuant to a convertible debenture thereby reducing
the  outstanding  amount  by $44,453. During the quarter, we received short term
loans  of $75,000 from Dutchess Private Equities Fund and $84,000 from a private
investor  bearing  an  interest  rate  of  20%.

Also during the quarter, we sold 1,150,000 restricted common shares in a private
placement valued at $.08. We issued 240,000 restricted common shares for private
placements  completed  previously  at $.10. We issued 581,200 common shares in a
private  placement  at  $.08  to  4  individuals.

During  the  period  ending  September  30,  2004  and the subsequent period, we
received  loans  from  our  Chief  Executive Officer and Chief Financial Officer
totaling  $192,500.

During  the  quarter  ended  September  30,  2004  we raised a total of $181,000
through  loans  and  approximately  $90,000  through  the  issuance of equity in
private  placements.  Also  we  reduced  the  outstanding  balance  due  on  our
convertible  debentures  by  $44,453, leaving an outstanding balance of $129,581
net  of  the  debt  discount  plus  fees  and  interest  of  $27,483.

Subsidiary

As of September 30, 2004, we had one wholly-owned subsidiary, FTS Wireless, Inc.


ITEM  3.     CONTROLS  AND  PROCEDURES

Evaluation  of  Disclosure  Controls  and  Procedures

     Within  the 90 days prior to the filing date of this report, we carried out
an evaluation of the effectiveness of the design and operation of our disclosure
controls  and  procedures  pursuant to Exchange Act Rule 13a-14. This evaluation
was done under the supervision and with the participation of our chief executive
officer  and chief financial officer. Based upon that evaluation, they concluded
that  our  disclosure  controls  and  procedures  are  effective  in  gathering,
analyzing  and  disclosing  information  needed  to  satisfy  our  disclosure
obligations  under  the  Exchange  Act.

Changes  in  Internal  Controls

     There  were  no  significant  changes  in our internal controls or in other
factors  that  could  significantly  affect those controls since the most recent
evaluation  of  such  controls.



                           PART  II-OTHER  INFORMATION

ITEM  1.     LEGAL  PROCEEDINGS

     We  are not aware of any legal matters that could have a material impact on
our  business.


ITEM  2.   UNREGISTERED  SALES  OF  EQUITY  SECURITIES

During  the  quarter, we issued 775,000 shares to Dutchess Private Equities Fund
pursuant  to  a convertible debenture financing thereby reducing the outstanding
amount  by  $44,453.

During  the  quarter  ended  September  30,  2004, we issued 2,478,500 shares of
restricted common stock for services rendered during the period ending September
30,  2004  and previous periods, including 625,000 shares to our Chief Executive
Officer as compensation, 200,000 to Linda Ehlen, our Chief Financial Officer, as
compensation,  250,000  to our former Chief Operating Officer, Robert Lewis, and
1,153,500  shares  for  consulting  services.

We  sold  1,150,000  restricted  common  shares in a private placement valued at
$.08.  We  issued  240,000  restricted  common  shares  for  private  placements
completed  previously  at  $.10.  We  issued  581,200 common shares in a private
placement  at  $.08  to  4  individuals.

The  securities  issued in the foregoing transactions were made in reliance upon
an  exemption from registration under Rule 701 promulgated under Section 3(b) of
the Securities Act. Alternatively, these issuances of securities were undertaken
under  Rule 506 of Regulation D under the Securities Act of 1933, as amended, by
the  fact  that:

-    the  sale was made to a sophisticated or accredited investor, as defined in
     Rule  502;

-    we  gave the purchaser the opportunity to ask questions and receive answers
     concerning  the  terms  and  conditions  of  the offering and to obtain any
     additional  information  which  we  possessed  or  could  acquire  without
     unreasonable  effort or expense that is necessary to verify the accuracy of
     information  furnished;

-    at  a  reasonable  time  prior  to  the  sale of securities, we advised the
     purchaser  of  the  limitations  on  resale in the manner contained in Rule
     502(d)2;

-    neither  we  nor any person acting on our behalf sold the securities by any
     form  of  general  solicitation  or  general  advertising;  and

-    we exercised reasonable care to assure that the purchaser of the securities
     is not an underwriter within the meaning of Section 2(11) of the Securities
     Act  of  1933  in  compliance  with  Rule  502(d).

ITEM  3.  DEFAULTS  UPON  SENIOR  SECURITIES

Not  Applicable.

ITEM  4.  SUBMISSION  OF  MATTERS  TO  A  VOTE  OF  SECURITY  HOLDERS

Not  Applicable.

ITEM  5.  OTHER  INFORMATION

Not  Applicable.

ITEM  6.  EXHIBITS

EXHIBITS

NUMBER  DESCRIPTION

3.1  Articles of Incorporation dated December 23, 2003 (filed as Attachment B to
     the  Registrant's Definitive Proxy on Form DEF 14A filed on January 9, 2004
     and  incorporated  herein  by  reference).

3.2  Bylaws  (filed as Attachment C to the Registrant's Definitive Proxy on Form
     DEF  14A  filed  on  January 9, 2004 and incorporated herein by reference).

10.1 Investment  Agreement  between the Registrant and Dutchess Private Equities
     Fund, LP, dated January 9, 2004 (filed as exhibit 10.15 to the Registrant's
     SB-2  filed  on  January  28,  2004  and incorporated herein by reference).

10.2 Registration  Rights  Agreement between the Registrant and Dutchess Private
     Equities  Fund,  LP,  dated  January 9, 2004 (filed as Exhibit 10.16 to the
     Registrant's  SB-2  filed  on  January  28, 2004 and incorporated herein by
     reference).

10.3 Placement Agent Agreement between the Registrant, Dutchess Private Equities
     Fund,  LP,  and Charleston Capital Securities, dated January 9, 2004 (filed
     as  Exhibit  10.17  to  the Registrant's SB-2 filed on January 28, 2004 and
     incorporated  herein  by  reference).

10.4 Consulting  Agreement  between  the  Registrant and W. Scott McBride, dated
     January  15,  2004  (filed as exhibit 99.1 to the Registrant's S-8 filed on
     February  3,  2004  and  incorporated  herein  by  reference).

10.5 Corporate  Consulting  Agreement  between  the  Registrant  and Theodore J.
     Smith,  Jr.,  dated  January  28,  2004  (filed  as  exhibit  99.2  to  the
     Registrant's  S-8  filed  on  February  3,  2004 and incorporated herein by
     reference).

10.6 Consulting  Agreement  between  the  Registrant  and Mike DeGirolamo, dated
     January  5,  2004  (filed  as exhibit 99.3 to the Registrant's S-8 filed on
     February  3,  2004  and  incorporated  herein  by  reference).

10.7 Consulting  Agreement  between  the  Registrant  and  Jeff  Teischer, dated
     January  5,  2004  (filed  as exhibit 99.4 to the Registrant's S-8 filed on
     February  3,  2004  and  incorporated  herein  by  reference).

10.8 Consulting  Agreement  between  the  Registrant  and  David  Taylor,  dated
     December  12,  2003 (filed as exhibit 99.5 to the Registrant's S-8 filed on
     February  3,  2004  and  incorporated  herein  by  reference).

10.9 Consulting Agreement between the Registrant and Pablo Oliva, dated November
     12,  2003  (filed as exhibit 99.6 to the Registrant's S-8 filed on February
     3,  2004  and  incorporated  herein  by  reference).

10.10  Consulting  Agreement  between  the  Registrant  and Tommy Hollman, dated
     January  27,  2004  (filed as exhibit 99.7 to the Registrant's S-8 filed on
     February  3,  2004  and  incorporated  herein  by  reference).

10.11  Compensation Agreement between the Registrant and W. Scott McBride, David
     Rasmussen,  James  H.  Gilligan and Scott Gallagher, dated January 29, 2004
     (filed  as  exhibit  99.8 to the Registrant's S-8 filed on February 3, 2004
     and  incorporated  herein  by  reference).

31.1 Certification of the Chief Executive Officer pursuant to Section 302 of the
     Sarbanes-Oxley  Act  of  2002.

31.2 Certification of the Chief Financial Officer pursuant to Section 302 of the
     Sarbanes-Oxley  Act  of  2002.

32.1 Certification  of  Officers  pursuant to 18 U.S.C. Section 1350, as adopted
     pursuant  to  Section  906  of  the  Sarbanes-Oxley  Act  of  2002.





                                      SIGNATURES


     Pursuant  to  the  requirements of the Securities Exchange Act of 1934, the
Company  has  caused  this  report to be signed on its behalf by the undersigned
thereunto  duly  authorized.


                                       FTS  GROUP,  INC.



Date:  November  22,  2004             By:  /s/  Scott  Gallagher
                                       -------------------------------
                                       Scott  Gallagher
                                       Chief  Executive  Officer

                                       By:  /s/  Linda  Ehlen
                                       -------------------------------
                                       Linda  Ehlen
                                       Chief  Financial  Officer and
                                       Principal Accounting Officer