SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

                   QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                         For Quarter Ended June 30, 2004
                           Commission File No. 0-29804

                          SecureCARE Technologies, Inc.
               --------------------------------------------------
               (Exact name of registrant as specified in charter)


            Nevada                                    82-0255758
    ----------------------              ------------------------------------
    (State or Jurisdiction               (IRS Employee Identification Number)
       Of Incorporation)

   3001 Bee Caves Road Suite 250 Austin, Texas             78746
   -------------------------------------------           ----------
    (Address of Principal Executive Offices)             (Zip Code)


       Registrant's Telephone Number, Including Area Code: (512) 439-3900
                                                           --------------

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 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 June 30, 2004, there were 19,954,000 shares of common stock, $.001 par
value and 1,360,000 shares of preferred stock, $.001 par value, of the
registrant issued and outstanding.

Transitional Small Business Disclosure Format (check one)

                                YES [ ]  NO [X]
<PAGE>

                          SecureCARE Technologies, Inc.
                                  JUNE 30, 2004
                                      INDEX


                                                                        Page No.
                                                                        --------
PART I     FINANCIAL INFORMATION

  Item 1.  Financial Statements

           Consolidated Balance Sheets as of June 30, 2004 (unaudited)
            and December 31, 2003                                            2

           Consolidated Statements of Operations (unaudited)
            for the three months ended June 30, 2004 and 2003                3

           Consolidated Statements of Operations (unaudited)
            for the six months ended June 30, 2004 and 2003                  4

           Consolidated Statements of Cash Flows (unaudited)
            for the six months ended June 30, 2004 and 2003                  5

           Notes to Interim Consolidated Financial Statements (unaudited)    6

  Item 2.  Management's Discussion and Analysis of Financial
            Condition and Results of Operations                             11

  Item 3.  Controls and Procedures                                          14

PART II    OTHER INFORMATION

  Item 1.  Legal Proceedings                                                15

  Item 2.  Changes in Securities and Use of Proceeds                        15

  Item 3.  Defaults Upon Senior Securities                                  15

  Item 4.  Submission of Matters to a Vote of Security Holders              15

  Item 5.  Other Information                                                15

  Item 6.  Exhibits and Reports on Form 8-K                                 15

SIGNATURES                                                                  16

CERTIFICATIONS                                                              17

                                       1
<PAGE>
<TABLE>
<CAPTION>

                 SECURECARE TECHNOLOGIES, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                 JUNE 30, 2004 (UNAUDITED) AND DECEMBER 31, 2003

                                     ASSETS
                                     ------
                                                                       2004            2003
                                                                   ------------    ------------
                                                                    (Unaudited)
<S>                                                                <C>             <C>
Current assets
  Cash and cash equivalents                                        $    674,191    $      2,500
  Accounts receivable - trade, net of allowance for doubtful
   accounts of $3,000 and $3,000 at June 30, 2004 (unaudited)
   and December 31, 2003, respectively                                   25,605          16,767
  Other current assets                                                    5,851           3,500
                                                                   ------------    ------------
         Total current assets                                           705,647          22,767

Property and equipment, net of accumulated depreciation of
  $282,827 and $301,057 at June 30, 2004 (unaudited) and
   December 31, 2003, respectively                                        2,484           2,593
Deferred financing fees, net of accumulated amortization
  of $16,670 at June 30, 2004 (unaudited)                                67,877              --
Other assets                                                                 --           5,851
Product development costs                                                80,000              --
                                                                   ------------    ------------

         Total assets                                              $    856,008    $     31,211
                                                                   ============    ============

                      LIABILITIES AND SHAREHOLDERS' DEFICIT
                      -------------------------------------

Current liabilities
  Current notes payable                                            $         --    $    610,490
  Accounts payable - trade                                              111,579         237,732
  Accrued payroll tax liabilities                                        65,074          50,465
  Accrued liabilities                                                   104,598          58,060
                                                                   ------------    ------------
         Total current liabilities                                      281,251         956,747

Long-term notes payable                                               1,021,157              --

Shareholders' deficit
  Preferred stock - $0.001 par value; 15,000,000 shares
   authorized, 1,360,000 and 0 shares issued and outstanding
   at June 30, 2004 (unaudited) and December 31, 2003,
   respectively (liquidation preference of $1.00 per share)               1,360              --
  Common stock - $0.001 par value; 50,000,000 shares authorized,
   19,954,000 and 15,000,000 shares issued and outstanding at
   June 30, 2004 (unaudited) and December 31, 2003, respectively         19,954          15,000
  Additional paid-in capital                                          9,981,610       8,661,505
  Deferred stock compensation                                           (15,448)             --
  Receivable for the purchase of equity                                  (2,000)             --
  Accumulated deficit                                               (10,431,876)     (9,602,041)
                                                                   ------------    ------------
         Total shareholders' deficit                                   (446,400)       (925,536)
                                                                   ------------    ------------

         Total liabilities and shareholders' deficit               $    856,008    $     31,211
                                                                   ============    ============
</TABLE>

The accompanying notes are an integral part of these financial statements.

                                        2
<PAGE>
<TABLE>
<CAPTION>

                 SECURECARE TECHNOLOGIES, INC. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
                FOR THE THREE MONTHS ENDED JUNE 30, 2004 AND 2003

                                                                     2004            2003
                                                                 ------------    ------------
<S>                                                              <C>             <C>
Revenues                                                         $     52,241    $     63,635

Operating expenses
  Cost of revenues                                                     48,895          54,604
  Research and development costs                                       11,834          18,901
  Selling, general and administrative                                 408,963         295,751
                                                                 ------------    ------------

  Operating loss                                                     (417,451)       (305,621)

Loss on disposal of asset                                                (495)             --
Gain on debt settlement                                                    --         397,674
Other income                                                            3,795          68,645
Interest expense                                                      (39,494)        (30,711)
                                                                 ------------    ------------

  Total other income (expenses)                                       (36,194)        435,608

                                                                 ------------    ------------
  Net income (loss)                                              $   (453,645)   $    129,987
                                                                 ============    ============

Net income (loss) per common share - basic and diluted           $      (0.02)   $       0.01
                                                                 ============    ============

Weighted average number of common shares outstanding - basic       19,715,934      21,365,688
                                                                 ============    ============

Weighted average number of common shares outstanding - diluted     19,715,934      22,653,882
                                                                 ============    ============
</TABLE>

The accompanying notes are in integral part of these financial statements.

                                        3
<PAGE>
<TABLE>
<CAPTION>

                 SECURECARE TECHNOLOGIES, INC. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
                 FOR THE SIX MONTHS ENDED JUNE 30, 2004 AND 2003

                                                                     2004            2003
                                                                 ------------    ------------
<S>                                                              <C>             <C>

Revenues                                                         $     85,972    $    126,728

Operating expenses
  Cost of revenues                                                     94,603         132,988
  Research and development costs                                       22,882          30,587
  Selling, general and administrative                                 747,200         651,217
                                                                 ------------    ------------

  Operating loss                                                     (778,713)       (688,064)

Gain on disposal of asset                                               4,699              --
Gain on debt settlement                                                    --         397,673
Other income                                                            3,795          68,645
Interest expense                                                      (59,616)       (123,897)
                                                                 ------------    ------------

  Total other income (expenses)                                       (51,122)        342,421

                                                                 ------------    ------------
  Net loss                                                       $   (829,835)   $   (345,643)
                                                                 ============    ============

Net loss per common share - basic and diluted                    $      (0.04)   $      (0.02)
                                                                 ============    ============
Weighted average number of common shares outstanding - basic
 and diluted                                                       19,288,681      21,303,327
                                                                 ============    ============
</TABLE>

The accompanying notes are in integral part of these financial statements.

                                        4
<PAGE>
<TABLE>
<CAPTION>

                 SECURECARE TECHNOLOGIES, INC. AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
                 FOR THE SIX MONTHS ENDED JUNE 30, 2004 AND 2003

                                                                           2004            2003
                                                                       ------------    ------------
<S>                                                                    <C>             <C>
Cash flows from operating activities
   Net loss                                                            $   (829,835)   $   (345,643)
   Adjustments to reconcile net loss to net cash used
    in operating activities:
      Depreciation                                                            2,593          69,064
      Bad debt expense                                                           --           9,982
      Gain on change in accounting estimate                                      --          68,645
      Gain on debt settlement                                                    --        (397,673)
      Stock issued for services                                                  --          33,250
      Common stock issued for directors compensation                          2,850              --
      Amortization of deferred compensation                                  40,096              --
      Warrants issued for converstion of debt to preferred stock                 --           8,147
      Amortization of deferred financing fees                                16,669           7,135
      Amortization of debt discount                                           8,667           9,770
      Increases and decreases in working capital accounts:
      Accounts receivable - trade                                            (8,838)        (26,529)
      Other current assets                                                   (2,351)          4,293
      Deferred financing fees                                               (71,975)             --
      Other assets                                                            5,851              --
      Customer deposits                                                          --          17,219
      Accounts payable - trade                                             (126,153)        (14,020)
      Accrued liabilities                                                    61,147         118,536
                                                                       ------------    ------------
           Cash flows used in operating activities                         (901,279)       (437,824)

Cash flows from investing activities
   Purchases of property and equipment                                       (2,484)             --
   Capitalization of product development                                    (80,000)             --
                                                                       ------------    ------------
           Cash flows used in investing activities                          (82,484)             --

Cash flows from financing activities
   Payments on capital lease obligation                                          --         (12,865)
   Borrowings from related parties                                               --          13,130
   Borrowings on notes payable                                              594,800         398,142
   Payments on notes payable                                               (140,800)        (20,348)
   Proceeds from issuance of preferred stock                              1,201,454              --
                                                                       ------------    ------------
      Cash flows provided by financing activities                         1,655,454         378,059

Net increase (decrease) in cash and cash equivalents                        671,691         (59,765)

Cash and cash equivalents, beginning of period                                2,500          85,204
                                                                       ------------    ------------

Cash and cash equivalents, end of period                               $    674,191    $     25,439
                                                                       ============    ============
Supplemental disclosures of cash flow information:
   Cash paid during the period for:
      Interest                                                         $        697    $      3,320
                                                                       ============    ============
Supplemental schedule of noncash investing and
   financing activities
      Stock issued for subscription receivable                         $      2,000    $         --
                                                                       ============    ============

      Common stock issued to settle with notes payable                 $     52,000    $         --
                                                                       ============    ============

      Stock issued as prepaid cost for issuance of debt                $     12,571    $         --
                                                                       ============    ============
      Conversion of notes payable and accrued interest
          to preferred stock                                           $         --    $    143,200
                                                                       ============    ============
      Warrants issued in connection with conversion of notes payable
          and accrued interest to preferred stock                                --    $      8,147
                                                                       ============    ============
</TABLE>

The accompanying notes are in integral part of these financial statements.

                                        5
<PAGE>

                 SECURECARE TECHNOLOGIES, INC. AND SUBSIDIARIES

         NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited)

1. BASIS OF PRESENTATION

On May 13, 2003 (the "Commencement Date") the Company filed a voluntary petition
under Chapter 11 of Title 11 of the United States Bankruptcy Code (the
"Bankruptcy Code") in the United States Bankruptcy Court for the Western
District of Texas (the "Bankruptcy Court"), Case No. 03-12387. During the course
of its Chapter 11 proceeding, the Company operated its business and managed its
assets as a debtor-in-possession pursuant to sections 1107(a) and 1108 of the
Bankruptcy Code.

On August 6, 2003, the Company filed a proposed Disclosure Statement and Joint
Plan of Reorganization, dated August 5, 2003, (the "Plan") with the Bankruptcy
Court. On October 23, 2003, after notice and a hearing, the Bankruptcy Court
signed the Disclosure Statement Order, approving the Company's Disclosure
Statement. On October 24, 2003, the Debtors commenced the solicitation of
holders of claims entitled to vote to accept or reject the Plan. On December 2,
2003, after notice and a hearing, the Bankruptcy Court entered its Findings of
Fact, Conclusions of Law and Order confirming the Debtor's Joint Plan of
Reorganization (the "Confirmation Order"). The Plan became final and
non-appealable on December 13, 2003. The Effective Date of the Plan is December
15, 2003.

In accordance with the terms of Article VI "Issuance of New Shares" of the
confirmed Plan, the outstanding shares of eClickMD, Inc. Common and Preferred
Stock, approximately 21.3 million and 89 shares, respectively, were cancelled
and voided effective December 15, 2003 (the Effective Date). In addition,
Article VI required that as soon as possible after the Effective Date, the
Company would amend its Articles of Incorporation to change its name to
SecureCare Technologies, Inc. and to authorize the issuance of 10,000,000 shares
of New Common Stock at $.001 par value.

On January 19, 2004, the Board of Director's of eClickMD, Inc. approved a 1.5
for 1 forward Common Stock Split (the "Stock Split"). On January 19, 2004, the
shareholder holding shares representing more than a majority of the shares of
Common Stock entitled to vote consented in writing to the Stock Split. The Stock
Split increased the number of shares of Common Stock issued and outstanding, as
approved in The Plan, from 10,000,000 to 15,000,000.

On January 19, 2004 the Board of Director's of eClickMD, Inc. determined to
change the name of the Company to SecureCare Technologies, Inc. The purpose of
the name change was to more accurately reflect the Company's present business
and its activities as well as to facilitate the future development of its
business. Approval of the name change required the affirmative consent of at
least a majority of the outstanding shares of the Common Stock of the Company.
The shareholder entitled to vote more than a majority of all the shares of
Common Stock entitled to vote consented to the name change on January 19, 2004.

The Company filed a Preliminary Information Statement regarding the name change
and the stock split with the Securities and Exchange Commission on January 24,
2004 and a Definitive Information Statement on February 3, 2004.

The Company filed an Amendment to its Corporate Charter with the State of Nevada
on February 25, 2004 affecting the Stock Split and the name change of the
Company to SecureCare Technologies, Inc. For financial reporting purposes, the
total number of shares of Common Stock issued and outstanding as of December 31,
2003 is 15,000,000 shares, reflecting the 1.5 for 1 forward split of the Common
Stock in February, 2004. The effect of the Stock Split has been applied to all
periods presented in the financial statements.

The interim financial statements of SecureCare Technologies, Inc. and
Subsidiaries (the "Company" or "SecureCARE") at June 30, 2004 and for the three
and six months ended June 30, 2004 and 2003, are unaudited, and include all
adjustments (consisting only of normal recurring adjustments) which the Company
considers necessary for a fair presentation. The December 31, 2003 balance sheet
was derived from the balance sheet included in the Company's audited financial
statements as filed on Form 10-KSB for the year ended December 31, 2003.

The accompanying unaudited interim financial statements are for interim periods
and do not include all disclosures normally provided in annual financial
statements, and should be read in conjunction with the Company's audited
financial statements included in the 10-KSB for the year ended December 31,
2003. The accompanying unaudited interim financial statements for the three and
six months ended June 30, 2004 are not necessarily indicative of the results
which can be expected for the entire fiscal year.

                                       6
<PAGE>
2. GOING CONCERN

The consolidated financial statements for the six months ended June 30, 2004
were prepared under the assumption that the Company will continue as a going
concern. The Company sustained a net loss of $829,835 for the six months ended
June 30, 2004. The Company has accumulated losses through June 30, 2004 of
$10,431,876. Cash used in operating activities for the six-month periods ended
June 30, 2004 and 2003 totaled $901,279 and $437,824, respectively. Total
liabilities at June 30, 2004 of $1,302,408 exceed total assets of $856,008. As
described in Note 1, on May 13, 2003 the Company filed a voluntary petition for
protection under Chapter 11 of the United States Bankruptcy Code in the United
States Bankruptcy Court for the Western District of Texas. The Company emerged
from Bankruptcy on December 15, 2003; however, the Company's continued existence
depends upon the success of management's efforts to raise additional capital
necessary to meet the Company's obligations as they come due, and to obtain
capital primarily through the issuances of debt or equity. There can be no
degree of assurance that the Company will be successful in completing additional
financing transactions.

The consolidated financial statements do not include any adjustments to reflect
the possible effects on the recoverability and classification of assets or
classification of liabilities which may result from the inability of the Company
to continue as a going concern.

3. USE OF ESTIMATES AND ASSUMPTIONS

Management uses estimates and assumptions in preparing financial statements in
accordance with U.S. generally accepted accounting principals generally accepted
in the United States of America. These estimates and assumptions affect the
reported amounts of assets and liabilities, the disclosure of contingent assets
and liabilities, and the reported amounts of revenues and expenses. Actual
results could vary from the estimates that were used.

4. STOCK-BASED COMPENSATION

The Company accounts for stock-based employee compensation arrangements in
accordance with provisions of Accounting Principles Board (APB) Opinion No. 25,
"Accounting for Stock Issued to Employees", and complies with the disclosure
provisions of SFAS No. 123, "Accounting for Stock-Based Compensation" as amended
by SFAS No. 148, "Accounting for Stock-Based Compensation - Transition and
Disclosure - an Amendment of FASB Statement No. 123". Under APB Opinion No. 25,
compensation expense for employees is based on the excess, if any, on the date
of grant, between the fair value of the Company's stock over the exercise price.

Had the Company determined compensation based on the fair value at the grant
date for its stock options issued to employees and directors under SFAS No. 123,
as amended by SFAS No. 148, net loss and loss per share would have increased as
indicated below:
<TABLE>
<CAPTION>

                                                    Six Months Ended     Six Months Ended  Three Months Ended  Three Months Ended
                                                      June 30, 2004       June 30, 2003       June 30, 2004       June 30, 2003
                                                      -------------       -------------       -------------       -------------
<S>                                                   <C>                 <C>                 <C>                 <C>
Net income (loss) per common share,
    as reported                                       $    (829,835)      $    (345,643)      $    (453,645)      $     129,987
Add:  Stock-based employee compensation,
     expense included in reported net loss                       --                  --                  --                  --
Deduct:  Stock-based employee compensation
     expense determined under fair value
     based method                                                --            (114,768)                 --             (57,386)
                                                      -------------       -------------       -------------       -------------
Pro forma net income (loss)                           $    (829,835)      $    (460,411)      $    (453,645)      $      72,601
                                                      =============       =============       =============       =============
Net  income (loss) per share - - Basic and diluted:
     As reported                                      $       (0.04)      $       (0.02)      $       (0.02)               0.01
                                                      =============       =============       =============       =============

     Pro forma                                        $       (0.04)      $       (0.02)      $       (0.02)                 --
                                                      =============       =============       =============       =============
</TABLE>

The Company accounts for equity instruments issued to non-employees in
accordance with the provisions of SFAS No. 123 and Emerging Issues Task Force
(EITF) Issue No. 96-18, Accounting for Equity Instruments That Are Issued to
Other Than Employees for Acquiring, or in Conjunction with Selling, Goods or
Services. All transactions in which goods or services are the consideration
received for the issuance of equity instruments are accounted for based on the
fair value of the consideration received or the fair value of the equity
instrument issued, whichever is more reliably measurable. The measurement date
of the fair value of the equity instrument issued is the earlier of the date on
which the counterparty's performance is complete or the date on which it is
probable that performance will occur.

                                       7
<PAGE>
<TABLE>
<CAPTION>

5. NOTES PAYABLE

Notes payable at June 30, 2004 (unaudited) and December 31, 2003 consist of the
following:

                                                                             2004            2003
                                                                          -----------    -----------
                                                                          (unaudited)
<S>                                                                       <C>            <C>
Notes payable to related parties bearing interest at 5%;
         During the course of its Chapter 11 proceedings, from
         May 2003 through December 2003, the Company borrowed a
         total of $610,490 in court-approved post petition
         financing. These borrowings represented notes payable,
         with interest at 5%, due on demand; the notes were
         secured by a security interest in the assets and
         intellectual property of the Company. Upon confirmation
         of the Company's Joint Plan of Reorganization on
         December 2, 2003, these current notes payable were
         restructured to long-term notes payable in accordance
         with the terms approved in the Joint plan of
         Reorganization. The revised terms on these notes payable
         are as follows: interest on the notes accrues effective
         August 13, 2004. Beginning on the first calendar day of
         the month following August 13, 2004 and on the first day
         of each calendar month for the next twelve months, the
         related party shall receive a payment equal to the
         accrued interest on the notes; thereafter, beginning on
         the first calendar day of the following month and
         continuing for the next fifty-nine months, the related
         party shall receive monthly principal and interest
         payments in the amount needed to fully amortize the
         notes (including interest) over sixty months                     $   544,490    $   610,490

Notes payable to investors bearing interest at 7.5% Principal
         and interest due February 13, 2006, unsecured                        220,000             --

Notes payable to investors bearing interest at 7.5% Principal
         and interest due March 2, 2006, unsecured                            150,000             --

Notes payable to investors bearing interest at 7.5% Principal
         and interest due March 9, 2006, unsecured                            150,000             --
                                                                          -----------    -----------
                                                                            1,064,490        610,490
                                Less unamortized debt discount:               (43,333)             0
                                                                          -----------    -----------
                                                                          $ 1,021,157    $   610,490
                                                                          ===========    ===========
</TABLE>

During February and March, 2004, in conjunction with the Bridge Financing, the
Company issued 520,000 shares of Common Stock. These shares were valued at $0.10
per share resulting in a total fair value of $52,000. This amount was recorded
as a Debt Discount and is amortized as a component of interest expense over the
life of the notes (two-years)

Future maturities of notes payable at June 30, 2004 are as follows:

              2004           $     27,224
              2005                108,898
              2006                628,898
              2007                108,898
              2008                108,898
              2009                 81,674
                             ------------
              Total          $  1,064,490
                             ============

                                       8
<PAGE>

6. DEFERRED FINANCING FEES

Deferred financing fees related to the notes payable are amortized on a
straight-line basis over the term of the notes payable which is two years.

7. SHAREHOLDERS' DEFICIT

In January 2004, the Company authorized the issuance of 2,350,000 shares of
Common Stock to directors, officers and employees valued at $0.023 per share
totaling $54,050. Out of these 2,350,000 shares, 1,600,000 shares were issued to
directors, of which 50% vested immediately and the remaining 50% will cliff vest
in one year. The remaining 750,000 shares were issued to employees which will
vest on October 1, 2004. The Company recorded deferred stock compensation of
$54,050 and will amortize the stock compensation expense over the applicable
vesting periods.

In June, 2004 the Company retroactively adjusted the total number of shares of
Common Stock issued to directors, officers and employees in January, 2004. The
total number of shares was increased by 65,000 to a revised total of 2,415,000.
These additional shares will vest on October 1, 2004 and were valued at $0.023
per share totaling $1,495. The Company recorded deferred stock compensation of
$1,495 and will amortize the stock compensation expense over the applicable
vesting periods.

Effective January 20, 2004 the Company entered into a Consulting Agreement (the
"Agreement") with Gryphon Financial Securities Corporation (the "Consultant") to
retain the Consultant, on a non-exclusive basis, to perform consulting services
related to corporate finance, strategic investments, capital raising, mergers
and acquisitions and other financial service matters. The term of the agreement
is for one year. In consideration of the Consultant performing these services,
the Company agreed to sell 2,000,000 shares of its Common Stock to the
Consultant for an aggregate purchase price of $2,000. These shares were valued
at $0.023 per share resulting in a net stock compensation expense of $44,000.
The portion of this expense allocated to fund raising in the Bridge Financing
totaled $12,571 and was recorded as deferred financing costs to be amortized on
a straight-line basis over the life of the notes (two-years). The portion of
this expense allocated to the fund raising in the Private Placement totaled
$31,429 and had a net-zero effect on additional paid in capital.

Bridge Financing: During February and March 2004, and pursuant to the Agreement
with Gryphon Financial Securities Corporation (the "Placement Agent"), the
Company raised an aggregate of $520,000 from seven (7) accredited investors (as
defined in Rule 503 under the 1933 Act) to fund the Company's operations (the
"Bridge Financing"). Investors in this Bridge Financing received $1.00 principal
amount of 7.5% Senior Subordinated Note ("Notes") and one (1) share of Common
Stock for each $1.00 that they purchased. The Notes are due on their second
anniversary date, but may be extended at the option of the Company for an
additional six (6) months. The Company must issue one share of Common Stock for
each $4.00 principal and accrued interest on the Notes that are extended.

During February and March, 2004, in conjunction with the Bridge Financing, the
Company issued 520,000 shares of Common Stock. Investors in this Bridge
Financing received $1.00 principal amount of 7.5% Senior Subordinated Note
("Notes") and one (1) share of Common Stock for each $1.00 that they purchased.
These shares were valued at $0.10 per share resulting in a total fair value of
$52,000. This amount was recorded as a Debt Discount and is amortized as a
component of interest expense over the life of the notes (two-years). The
Placement Agent received warrants to purchase an aggregate of 52,000 shares of
Common Stock at an exercise price of $1.00 per share. These warrants expire in
February and March of 2011.

Private Placement: During May and June, 2004 and pursuant to the Agreement with
Gryphon Financial Securities Corporation (the Placement Agent), the Company
received funds through a Private Placement (the "Placement"). In the financing
the company issued an aggregate of 1,360,000 shares of Series A Preferred Stock,
with a $1.00 per share stated value, initially convertible into one share of the
Company's Common Stock, par value $.001 per share. The placement agent and the
investors in the financing received warrants to purchase an aggregate of
1,632,000 shares of common stock at an exercise price of $1.00 per share with
272,000 warrants issued to the Placement Agent and 1,360,000 warrants issued to
the investors. These warrants expire in May through June of 2009.

In June 2004, the Company authorized the issuance of 15,000 shares of Common
Stock to the Chairman of the Board and Chief Medical Officer of SecureCare
Technologies, Inc. These shares were valued at $0.15 per share totaling $2,250.
This amount was recorded as Stock Compensation Expense.

In June 2004, the Company authorized the issuance of 4,000 shares to its two
Medical Advisory Board members (2,000 shares each) as compensation for services
provided on the board. These shares were valued at $0.15 per share totaling
$600. This amount was recorded as Stock Compensation Expense.

                                       9
<PAGE>

8. SOFTWARE DEVELOPMENT COSTS

In accordance with SFAS No. 86, "Accounting for the Costs of Computer Software
to be Sold, Leased or Otherwise Marketed", internally-generated software
development costs associated with new products and significant enhancements to
existing software products are expensed as incurred until technological
feasibility has been established. Software development costs that qualify for
capitalization include the salaries and benefits of the software engineers
assigned to the products, internal and external quality assurance testing costs,
overhead allocations primarily associated with rent and facilities costs and the
costs of outsourced development activities and independent product testing and
certification labs. Software development costs not qualifying for capitalization
are recorded as product development expense. Capitalized software development
costs, including purchased software, if any, are amortized using the greater of
the revenue method or the straight-line method generally with useful lives of
three years or less. At each balance sheet date the Company evaluates the
estimated net realizable value of each software product and when required,
records write-downs of net book value to net realizable value of any products
for which the net book value is in excess of the net realizable value. The net
realizable value is the estimated future gross revenue of each product reduced
by estimated future costs of completing and disposing of that product, including
the costs of completing in process development and customer support. For the six
months ended June 30, 2004 the Company had recorded capitalized software
development costs totaling $80,000 and recorded amortization expenses of zero
dollars.

9. PREFERRED STOCK ISSUED FOR CASH

During May and June, 2004 and pursuant to the Consulting Agreement (the
"Agreement") with the Consultant, the Company received funds through a Private
Placement (the "Placement"). Aggregate gross proceeds of the financing through
June 30, 2004 were $1,360,000. The Company paid commissions of 8%, paid certain
expenses of the financing and realized net proceeds of approximately $1,201,450.
In the financing the Company issued an aggregate of 1,360,000 shares of Series A
Preferred Stock, with a $1.00 per share stated value, initially convertible into
one share of the Company's Common Stock, par value $.001 per share. The
placement agent and the investors in the financing received warrants to purchase
an aggregate of 1,632,000 shares of common stock at an exercise price of $1.00
per share with 272,000 warrants issued to the Placement Agent and 1,360,000
warrants issued to the investor. These warrants expire in May through June of
2009.

10. SUBSEQUENT EVENT

Subsequent to June 30, 2004 and pursuant to the Consulting Agreement (the
"Agreement") with the Consultant, the Company received additional funds through
a Private Placement (the "Placement"). Total gross proceeds from July 1, 2004
through August 13, 2004 were $570,000. The Company paid commissions of 8%, paid
certain expenses of the financing and realized net proceeds of approximately
$514,491. In the financing the Company issued an aggregate of 570,000 shares of
Series A Preferred Stock, with a $1.00 per share stated value, initially
convertible into one share of the Company's Common Stock, par value $.001 per
share. The placement agent and the investors in the financing received warrants
to purchase an aggregate of 680,000 shares of common stock at an exercise price
of $1.00 per share with 110,000 warrants issued to the Placement Agent and
570,000 warrants issued to the investor. These warrants expire in May through
June of 2009.

                                       10
<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and
        Results of Operations

                           Forward Looking Statements

This Quarterly Report on Form 10-QSB contains "forward-looking" statements as
such term is defined in the Private Securities Litigation Reform Act of 1995 and
information relating to the Company and its subsidiaries that are based on the
beliefs of the Company's management as well as assumptions made by and
information currently available to the Company's management. When used in this
report, the words "anticipate," "believe," "estimate," "expect" and "intend" and
words or phrases of similar import, as they relate to the Company or its
subsidiaries or Company management, are intended to identify forward-looking
statements. Such statements reflect the current risks, uncertainties and
assumptions related to certain factors including, without limitations,
competitive factors, general economic conditions, customer relations,
relationships with vendors, the interest rate environment, governmental
regulation and supervision, seasonality, distribution networks, product
introductions and acceptance, technological change, changes in industry
practices, onetime events and other factors described herein and in other
filings made by the company with the Securities and Exchange Commission. Based
upon changing conditions, should any one or more of these risks or uncertainties
materialize, or should any underlying assumptions prove incorrect, actual
results may vary materially from those described herein as anticipated,
believed, estimated, expected or intended. The Company does not intend to update
these forward-looking statements.

Overview

SecureCare Technology, Inc. ("SCTI") management believes it is the leader in
eSignature document workflow technology and that its technology lowers
infrastructure costs, drives workflow efficiency, and increases profitability
for physicians, home health care agencies, and providers of durable medical
equipment. Home health care executives founded the Company in 1996 to address
inefficiencies in workflow processes between home health care agencies and
physicians. That same year, the U.S. government released the Health Insurance
Portability and Accountability Act (HIPAA) that mandated Internet-based
electronic storage and transmission of patient data be standardized, secured,
and subjected to rigorous privacy rules. SCTI quickly enhanced its digital
certificate and e-signature technology to comply with these HIPAA standards.
Today, the Company has nine technology patents pending for managing and
transmitting sensitive patient data.

The Company has developed and intends to provide a broad range of Web-based
healthcare electronic commerce services that will improve communication among
physicians, suppliers, and other providers; however, there can be no assurance
given that the Company will be successful in its development efforts. These
services using Internet technology in the healthcare electronic commerce
industry are subject to risks, including but not limited to those associated
with competition from existing companies offering similar services, rapid
technological change, development risks, management of growth and a minimal
previous record of operations or earnings.

Results of Operations

Three Months Ended June 30, 2004 Compared to Three Months Ended June 30, 2003

Revenues for the three months ended June 30, 2004 were $52,241 compared to
$63,635 for the three months ended June 30, 2003. Fewer customers were billed in
2004 as a result of a review of accounts receivable that was completed in the
second half of 2003, where a significant number of customers with aged
receivable balances were assigned former client status and were no longer
billable in 2004.

Management believes that revenues will continue to grow significantly over the
next twelve to eighteen months if the Company is able to raise the additional
capital to execute its marketing and sales strategy. Since December 2003, the
Company's revenue base has more than doubled, reflecting the company's expanded
sales and marketing efforts.

Operating expenses were $469,692 for the three months ended June 30, 2004
compared to $369,256 for the same period of 2003. The 27% increase in operating
expenses was primarily due an increase in headcount over the three-month period,
resulting in higher payroll expenses for the quarter. With an increased active
customer base, an expanded sales and marketing strategy, and successful
fundraising, the Company increased the employee total to ensure the

                                       11
<PAGE>

accomplishment of management's objectives. The expanded sales force and
aggressive marketing strategy attributed to higher travel and business
development expenses of approximately $33,000 in the second quarter of 2004. To
accommodate the expanding customer base, the Company invested more resources it
its customer support department, also contributing to higher operating expenses
in 2004. Partially offsetting these were lower legal settlement expenses. In the
second quarter of 2003, $47,973 in legal settlement expenses were incurred. All
outstanding lawsuits were extinguished with the confirmation of the
Reorganization Plan in December 2003, obviating legal settlements in 2004. In
addition, the Company did not incur depreciation expense for the three months
ended June 30, 2004 as fixed assets were fully depreciated on March 31, 2004.
Reported depreciation for the same period in 2003 was $32,000.

Management expects that operating expenses will increase over the next twelve to
eighteen months if the Company is able to raise the additional capital required
to make the necessary investments in technology enhancements and in its planned
marketing and sales programs.

Interest expense for the three months ended June 30, 2004 was $39,494 compared
to $30,711 in 2003. During February and March 2004, and pursuant to the
Agreement with Gryphon Financial Securities Corporation (the "Placement Agent"),
the Company raised an aggregate of $520,000 from seven (7) accredited investors
(as defined in Rule 503 under the 1933 Act) to fund the Company's operations
(the "Bridge Financing"). Investors in this Bridge Financing received $1.00
principal amount of 7.5% Senior Subordinated Note ("Notes") and one (1) share of
Common Stock for each $1.00 that they purchased. The Notes are due on their
second anniversary date, but may be extended at the option of the Company for an
additional six (6) months. The Company must issue one share of Common Stock for
each $4.00 principal and accrued interest on the Notes that are extended.

In the second quarter of 2004, $19,166 of the expenses were related to
amortization of the financing fees associated with the Bridge Financing in the
First Quarter of 2004. The balance of $20,328 in interest expense was accrued on
the $544,490 of post-petition debt and $520,000 of Bridge Financing debt still
outstanding on June 30, 2004.

Six Months Ended June 30, 2004 Compared to Six Months Ended June 30, 2003

Revenues for the six months ended June 30, 2004 were $85,972 compared to
$126,728 for the same period in 2003. Fewer customers were billed in 2004 as a
result of a review of accounts receivable that was completed in the latter part
of 2003, where a significant number of customers with aged receivable balances
were assigned former client status and were no longer billable in 2004.

Management believes that revenues will continue to grow significantly over the
next twelve to eighteen months if the Company is able to raise the additional
capital to execute its marketing and sales strategy. Since December 2003, the
Company's revenue base has more than doubled, reflecting the company's expanded
sales and marketing efforts.

Operating expenses were $864,685 for the six months ended June 30, 2004 compared
to $814,792 for the six months ended June 30, 2003. This 6% increase in
operating expenses was primarily attributable to expansion in sales and business
development. In conjunction with this expansion, the Company has invested a
greater number of resources, employees, and time to grow the customer base and
sales pipeline during the first half of 2004. In addition, expenses were higher
in 2004 due to stock compensation expense related to the Common Stock issued in
January, 2004 to directors and employees of $38,346 and to a Consultant of
$4,600. These increased expenses were moderately offset, as depreciation expense
was significantly lower in the first two quarters of 2004 as a majority of the
Company's fixed assets were fully depreciated at December 31, 2003.

Management expects that operating expenses will increase over the next twelve to
eighteen months if the Company is able to raise the additional capital required
to make the necessary investments in technology enhancements and in its planned
marketing and sales programs.

Interest expense for the six months ended June 30, 2004 was $59,616 compared to
$123,897 in 2003. Lower interest expense in 2004 resulted from a lower debt load
due to the debt settlement that occurred in December 2003 when the
Reorganization Plan was approved.

On May 13, 2003 (the "Commencement Date") the Company filed a voluntary petition
under Chapter 11 of Title 11 of the United States Bankruptcy Code (the
"Bankruptcy Code") in the United States Bankruptcy Court for the Western
District of Texas (the "Bankruptcy Court"), Case No. 03-12387. During the course
of its Chapter 11 proceeding, the Company operated its business and managed its
assets as a debtor-in-possession pursuant to sections 1107(a) and 1108 of the
Bankruptcy Code. On August 6, 2003, the Company filed a proposed Disclosure
Statement and Joint Plan of Reorganization, dated August 5, 2003, (the "Plan")
with the Bankruptcy Court. On October 23, 2003, after notice and a hearing, the
Bankruptcy Court signed the Disclosure Statement Order, approving the Company's
Disclosure Statement. On October 24, 2003, the Debtors commenced the
solicitation of holders of claims entitled to vote to accept or reject the Plan.
On December 2, 2003, after notice and a hearing, the Bankruptcy Court entered

                                       12
<PAGE>

its Findings of Fact, Conclusions of Law and Order confirming the Debtor's Joint
Plan of Reorganization (the "Confirmation Order"). The Plan became final and
non-appealable on December 13, 2003. The Effective Date of the Plan is December
15, 2003.

However, $28,238 of the interest recorded in the First Half of 2004 was related
to the amortization of the deferred financing fees associated with the Bridge
Offering that took place in the First Quarter of 2004. The remaining interest
expense of $31,378 is the interest accrued on the $544,490 of post-petition debt
and $520,000 of Bridge Financing debt still outstanding on June 30, 2004.

Liquidity and Capital Resources

Net cash used by operating activities for the six months ended June 30, 2004 and
2003 totaled $901,279 and $437,824, respectively. Increased net uses of cash in
2004 resulted primarily from the Company making cash dividend payments to its
unsecured creditors of $60,784 as required in its approved Plan of
Reorganization, paying down the balance of certain significant accounts payable
totaling $65,370, and higher operating expenses primarily due to hiring and
expansion of the Company's sales and marketing programs.

Net cash provided by financing activities was $1,655,454 for the six months
ended June 30, 2004 and consisted primarily of the issuance of the Company's
Series A Convertible Preferred Stock and borrowings on notes payable. Net cash
provided by financing activities was $378,059 for the six months ended June 30,
2003 and consisted primarily of borrowings on notes payable.

Net cash used in investing activities was $82,484 for the six months ended June
30, 2004 and consisted primarily of expenditures for product development.

On January 16, 2004, the Company issued a Promissory Note to York Avenue
Holdings ("York") for $24,800 with interest at 5%. This loan was primarily for
working capital needs prior to the receipt of funds in the Bridge Financing. The
Company paid $18,600 in principal payments to York in March 2004. The remaining
principal balance of the note, $6,200, was paid in full in May 2004.

Effective January 20, 2004 the Company entered into a Consulting Agreement (the
"Agreement") with Gryphon Financial Securities Corporation (the "Consultant" or
the "Placement Agent") to retain the Consultant, on a non-exclusive basis, to
perform consulting services related to corporate finance, strategic investments,
capital raising, mergers and acquisitions and other financial service matters.
The term of the agreement is for one year. In consideration of the Consultant
performing these services the Company agreed to sell 2,000,000 shares of its
Common Stock to the Consultant for an aggregate purchase price of $2,000.

During February and March 2004, with Gryphon Financial Securities Corporation as
the exclusive Placement Agent, the Company raised an aggregate of $520,000 from
seven (7) accredited investors (as defined in Rule 503 under the 1933 Act) to
fund the Company's operations ("the Bridge Financing"). Investors in this Bridge
Financing received $1.00 principal amount of 7.5% Senior Subordinated Note
("Notes") and one (1) share of Common Stock for each $1.00 that they purchased.
The Notes are due on their second anniversary date, but may be extended at the
option of the Company for an additional six (6) months. The Company must issue
one share of Common Stock for each $4.00 principal and accrued interest on the
Notes that are extended.

The aggregate gross proceeds of the Bridge Financing, through June 30, 2004 were
$520,000. The Company paid commissions of 8%, paid certain expenses of the
financing and realized net proceeds of approximately $448,000. In the financing,
the Company issued an aggregate of $520,000 of principal amount of 7.5% senior
promissory notes having a two-year maturity. The investors in the financing also
received a total of 520,000 shares of Common Stock. The Placement Agent received
warrants to purchase an aggregate of 52,000 shares of Common Stock at an
exercise price of $1.00 per share. These warrants expire in February and March
of 2011.

During May and June, 2004 and pursuant to the Consulting Agreement with the
Consultant, the Company received funds through a Private Placement ("the
Placement"). Aggregate gross proceeds of the financing through June 30, 2004
were $1,360,000. The Company paid commissions of 8%, paid certain expenses of
the financing and realized net proceeds of approximately $1,201,450. In the
financing the company issued an aggregate of 1,360,000 shares of Series A
Preferred Stock, with a $1.00 per share stated value, initially convertible into
one share of the Company's Common Stock, par value $.001 per share. The
placement agent and the investors in the financing received warrants to purchase
an aggregate of 1,632,000 shares of common stock at an exercise price of $1.00
per share with 272,000 warrants issued to the Placement Agent and 1,360,000
warrants issued to the investor. These warrants expire in May through June of
2009.

The Company has limited cash resources and intends to raise additional capital
through the issuance of debt or equity. The Company believes the additional
capital will allow it to continue its marketing efforts in its core products and

                                       13
<PAGE>

develop and add new functional enhancements to the browser-based versions of its
products. The availability of cash through such resources is not assured and if
the Company is not able to raise enough cash, the Company might be forced to
limit its operations and marketing activities, or ultimately cease operations.

The consolidated financial statements have been prepared on the assumption that
the Company will continue as a going concern. The Company's continued existence
depends upon the success of management's efforts to raise additional capital
necessary to meet the Company's obligations as they come due and to obtain
sufficient capital to execute its business plan. There can be no degree of
assurance given that the Company will be successful in completing additional
financing transactions.

The consolidated financial statements do not include any adjustments to reflect
the possible effects on the recoverability and classification of assets or
classification of liabilities which may result from the inability of the Company
to continue as a going concern.

Item 3. Controls and Procedures

Within 90 days prior to the date of this report, we carried out an evaluation,
under the supervision and with the participation of our principal executive
officer and our principal financial officer, of the effectiveness of the design
and operation of our disclosure controls and procedures. Based on this
evaluation, our principal executive officer and principal financial officer
concluded that our disclosure controls and procedures are effective in timely
alerting them to material information required to be included in our periodic
SEC reports. It should be noted that the design of any system of controls is
based in part upon certain assumptions about the likelihood of future events,
and there can be no assurance that any design will succeed in achieving its
stated goals under all potential future conditions, regardless of how remote.

In addition, we reviewed our internal controls, and there have been no
significant changes in our internal controls or in other factors that could
significantly affect those controls subsequent to the date of their last
evaluation.

                                       14
<PAGE>
                                     PART II

                                OTHER INFORMATION

Item 1.  Legal Proceedings

         None.

Item 2.  Changes in Securities

         None.

Item 3.  Defaults Upon Senior Securities

         None.

Item 4.  Submission of Matters to a Vote of Security Holders

         None.

Item 5.  Other Information

         None.

Item 6.  Exhibits and Reports on Form 8-K

         a)       EXHIBITS

                  3.1      Certificate of Voting Powers, Designations,
                           Preferences and Rights of Series A Convertible
                           Preferred Stock of the Company

                  31.1     Certification by Neil S. Burley, Chief Financial
                           Officer, pursuant to 18 USC Section 1350, as adopted
                           pursuant to Section 302 of the Sarbanes-Oxley Act of
                           2002

                  31.2     Certification by Robert Woodrow, President , Chief
                           Operating Officer and Director, pursuant to 18 USC
                           Section 1350, as adopted pursuant to Section 302 of
                           the Sarbanes-Oxley Act of 2002

                  32.1     Certifications by Robert Woodrow, President, Chief
                           Operating Officer and Director and Neil Burley, Chief
                           Financial Officer, pursuant to 18 USC Section 1350,
                           as adopted pursuant to Section 906 of the
                           Sarbanes-Oxley Act of 2002

         b)       REPORTS ON FORM 8-K

                  None.

                                       15
<PAGE>

                                   SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.


Date:   August 19, 2004                By: /s/ NEIL BURLEY
                                           -------------------------------------
                                           Neil Burley, Chief Financial Officer
                                           (Principal Financial and Accounting
                                           Officer)


                                       By: /s/ ROBERT WOODROW
                                           -------------------------------------
                                           Robert Woodrow, President, Chief
                                           Operating Officer and Director


Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed by the following persons on behalf of the registrant and in the
capacities and on the dates indicated.

NAME                                        TITLE                  DATE SIGNED

By: /s/ NEIL BURLEY                 Chief Financial Officer      August 19, 2004
    -------------------------       (Principal Financial and
    Neil Burley                     Accounting Officer)


By: /s/ ROBERT WOODROW              President, Chief Operating   August 19, 2004
    -------------------------       Officer and Director
    Robert Woodrow

                                       16