EXHIBIT 99.2


               PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 -
                   SAFE HARBOR FOR FORWARD-LOOKING STATEMENTS


     The Private Securities Litigation Reform Act of 1995 provides a safe harbor
for  forward  looking  statements  made by public  companies.  This safe  harbor
protects  a  company  from   securities   law  liability  in   connection   with
forward-looking  statements if the company complies with the requirements of the
safe harbor. As a public company, Wade Cook Financial Corporation has relied and
will continue to rely on the  protection  of the safe harbor in connection  with
its written and oral forward-looking statements.

     When  evaluating  Wade Cook Financial  Corporation's  business,  you should
consider:

     o    all of the information in this quarterly report on Form 10-Q;

     o    the risk factors described in the Company's Annual report for the year
          ended  December  31,  2000  filed  with the  Securities  and  Exchange
          Commission; and

     o    the risk factors described below.


                                  RISK FACTORS


Corporate Control By Wade B. Cook

     Wade B. Cook is the founder,  majority stockholder,  Chairman of the Board,
Chief  Executive  Officer and President of the Company.  Laura Cook,  Mr. Cook's
wife,  is the  Secretary  of  the  Company  and a  consultant  to the  Company's
executive  management.  Several of Mr. Cook's relatives work at the Company. Mr.
Cook  maintains  control  over most  aspects of the Company  including,  but not
limited  to,  setting  corporate  policy,   determining   strategic   direction,
determining  the  acquisition  or sale of assets  by the  Company,  setting  the
material terms of acquisitions  and determining the material  provisions of many
of the Company  contracts.  Mr. Cook provides input on every product and seminar
sponsored by the Company.  Mr. Cook also directs most  marketing  efforts of the
Company and has a substantial  influence on the  management of the Company.  Mr.
Cook  will  continue  to have a  significant  influence  over the  policies  and
procedures  of the Company and will be in a position to determine the outcome of
corporate  actions  requiring  stockholder  approval,  including the election of
Directors,  the adoption of amendments to the Company's corporate documents, the
approval of mergers and the sale of the Company assets.

Dependence on Wade B. Cook

     The  Company's  business is highly  dependent on the  continuing  effective
involvement  of Mr.  Cook.  Mr.  Cook  personally  directs  most  aspects of the
Company's business.  The Company has a non-exclusive  license which expires June
30,  2002  to use Mr.  Cook's  products,  intellectual  property,  name,  image,
identity, trademarks and trade symbols which are featured prominently in many of
the Company's  services and products.  Mr. Cook is not prohibited from competing
with  the  Company  or  granting  licenses  to  competitors.   See  "Business  -
Intellectual  Property."  The  business  of  the  Company  would  be  materially
adversely affected if Mr. Cook's services were not available to the Company,  or
if Mr.  Cook  should  compete  with  the  Company  or  grant  licenses  or other
assistance to competitors.

Liquidity Constraints

     The Company's principal source of cash has been from its education seminars
and its sale of books, tapes and other materials focused on business strategies,
financial planning and personal wealth management. The amount of income consumed
by operations  decreased  slightly from  ($224,000) for the  three-month  period
ended  September  30,  2000 to  ($214,000)  for  the  three-month  period  ended
September  30,  2001.  See  "Management's  Discussion  and Analysis of Financial
Condition and Results of Operations - Results of Operations."



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     The Company's  practice of using  available cash to fund its  subsidiaries,
recent  earthquake and flooding  damage,  implementation  of a consumer  redress
program and the fact that the Company's  seminar business has not generated cash
as in the past have resulted in  constraints  on  liquidity,  and to some degree
have had an effect on the Company's  ability to pay certain  obligations as they
have come due. As of September  30,  2001,  the Company had  approximately  $4.4
million in accounts payable, a decrease of $2.1 million from the $6.5 million in
accounts payable due as of December 31, 2000.

     Cash  used  in  operations,  which  has  historically  been  the  Company's
principal source of cash for working capital, was $(400,000) for the nine months
ended  September  30, 2000,  as compared to $(3.0)  million as of September  30,
2001. The increase of $2.6 million in the Company's use of cash in operations is
primarily  attributable  to payment  of  approximately  $2.1  million in Company
account  payables since December 31, 2000,  extra expenses  associated  with the
February 28, 2001 earthquake and resulting water damage,  and expenditures  made
on  residential  real estate  developments  in Western  Washington.  The Company
anticipates that expenses associated with earthquake and resulting water damage,
as well as  attendant  lost  profits,  will  continue to  adversely  affect cash
provided by operations in future periods.

     The Company may be required to generate cash for working  capital  purposes
from its  non-marketable  investments or other assets.* If it seeks to do so, it
may not be able to liquidate investments in a timely manner, or in a manner that
would allow the Company to realize the full value of the  investments  or assets
involved.  Failure to generate adequate cash resources for working capital could
require  the  Company  to cut back  operations,  delay or cancel  expansion  and
development  projects,  default  on  contracts,   forfeit  valuable  rights  for
non-payment  or  non-performance  and  cause  the  Company  to be unable to meet
obligations.


Legal Proceedings and Governmental Investigations

     The Company is a party to a number of legal proceedings.  See Item 1. Legal
Proceedings.  Although the Company, based upon the information available to date
(including  information  supplied by counsel) and  particularly  in light of the
Company's past history of settling  previous  legal disputes out of court,  does
not presently  expect  material  liability in these  matters or any others,  the
outcome of such matters is difficult to predict and subject to uncertainty,  and
the legal fees and other costs involved could be material.  Any negative finding
as a result of this investigation  could have a materially adverse effect on the
Company's financial condition and results of operations.

Effect of Securities Market Conditions on the Company's Business

     The  Company  believes  that the level of  public  interest  in  investing,
particularly in the securities and option markets as well as electronic  trading
has  significantly  influenced  the market for its  products and  services.  The
securities markets have experienced  substantial volatility in recent periods. A
sharp  drop or  sustained  or  gradual  decline  in  securities  prices or other
developments  in  the  securities   markets  typically  could  cause  individual
investors to be less inclined to invest in the securities  markets,  which would
be likely to result in reduced  interest in the  Company's  seminars and related
products and services. Declines in the securities markets also adversely affects
the value of the Company's investment portfolio.



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State and federal government relations.

     As discussed in this Quarterly  Report,  the Company is a party to a number
voluntary Consent Decrees (the  "Agreements")  with the Federal Trade Commission
and the consumer affairs  divisions of 14 states.  The Agreements  relate to the
Company's  future  advertising  practices and the  implementation  of a consumer
redress  program.   While  the  Company  fully  intends  to  comply  with  these
Agreements, failure to comply with the terms of these Agreements could result in
legal action by the  respective  state and federal  authorities.  Legal remedies
could include injunctions against violating  respective consumer laws, recission
of prior customer contracts, customer refunds, contempt, and/or disgorgement.

Earthquake and Flooding Damage.

     On February 28, 2001,  an  earthquake  (the  "Earthquake")  struck  Western
Washington.  (For a more complete description,  please see the Liquidity section
of Management's  Discussion and Analysis and Item 1. Legal Proceedings contained
in this  Quarterly  Report).  In  concert  with the  earthquake,  the  Company's
corporate  headquarters (the  "Headquarters"),  located in Seattle,  Washington,
experienced  severe  localized  flooding (the  "Flooding").  As of September 30,
2001, the Company had incurred losses relating to this repair and reconstruction
of approximately $1.4 million, excluding lost business income; equipment damage;
damage to furniture,  fixtures and inventory;  and extra  expenses.  The Company
expects to incur additional costs in the future until the restoration process is
completed.  The Company contacted its insurance  carrier,  Caliber One Indemnity
Company ("Caliber One"), and tendered claims for earthquake and flooding damage.
Upon submission of the claim,  Caliber One informed the Company that it believed
the applicable  coverage  sub-limit for  earthquake was $500,000.  The Company's
records  indicate  that the  initial  Policy,  as taken out in the years 1998 to
1999,   provides  coverage  limits  up  to  $5,000,000.   The  Company  did  not
subsequently  request a reduced  coverage  sub-limit,  and the  premium  for the
policy  remained  constant  from the initial  placement  to the present  Policy.
However, a typographical error was made by Caliber One in printing the Company's
1999 to 2000 Policy.  In a letter  dated May 31,  2001,  Counsel for Caliber One
states, "Caliber One has 1999 to December 1, 2000 policy period resulted from an
error on its part." The Company demanded Caliber One pay its claim.  Caliber One
failed to do so.  Following  another demand for payment by the Company,  Caliber
One filed a complaint  alleging that the Company's failure to advise Caliber One
about the typographical error it had caused, constituted acceptance of a reduced
coverage sub-limit.  The Company strongly disagrees with Caliber One's position,
and  asserts  counterclaims  of breach of  contract,  fraud,  misrepresentation,
violation of the Consumer Protection Act, violation of the RICO Act, and related
claims.  As of  September  30,  2001,  the  Company had  received  approximately
$220,000 in insurance  proceeds  relative to this claim. In October of 2001, the
Company  received an  additional  approximate  $280,000  pursuant to this claim.
Failure to properly resolve issues arising out of recent flooding and earthquake
damages or inadequate insurance coverage could have a material adverse effect on
operations and the Company's financial condition.



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