**Exhibit 31.1**

 

CERTIFICATION

 

I,Chester L.F. Paulson, certify that:

 

1.               I have reviewed thisquarterly report on Form 10-Q of Paulson Capital Corp.;

 

2.               Based on my knowledge, thisquarterly report does not contain any untrue statement of a material fact oromit to state a material fact necessary to make the statements made, in lightof the circumstances under which such statements were made, not misleading withrespect to the period covered by this quarterly report;

 

3.               Based on my knowledge, thefinancial statements, and other financial information included in thisquarterly report, fairly present in all material respects the financialcondition, results of operations and cash flows of the registrant as of, andfor, the period presented in this quarterly report;

 

4.               The registrant’s othercertifying officers and I are responsible for establishing and maintainingdisclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and15d-15(e)) for the registrant and we have:

 

a.               Designed such disclosurecontrols and procedures, or caused such disclosure controls to be designedunder our supervision, to ensure that material information relating to theregistrant, including its consolidated subsidiaries, is made known to us byothers within those entities, particularly during the period in which thisquarterly report is being prepared;

 

b.              Evaluated the effectivenessof the registrant’s disclosure controls and procedures and presented in thisreport our conclusions about the effectiveness of the disclosure controls andprocedures, as of the end of the period covered by this report based on suchevaluation; and

 

c.               Disclosed in this report anychange in the registrant’s internal control over financial reporting thatoccurred during the registrant’s most recent fiscal quarter (the registrant’sfourth quarter in the case of an quarterly report) that has materiallyaffected, or is reasonably likely to materially affect, the registrant’sinternal control over financial reporting; and

 

5.               The registrant’s othercertifying officers and I have disclosed, based on our most recent evaluationof internal control over financial reporting, to the registrant’s auditors andthe audit committee of registrant’s board of directors (or persons performingthe equivalent function):

 

a.               All significant deficienciesin the design or operation of internal controls which are reasonably likely toadversely affect the registrant’s ability to record, process, summarize andreport financial information; and

 

b.              Any fraud, whether or notmaterial, that involves management or other employees who have a significantrole in the registrant’s internal control over financial reporting.

 
| Dated: August 12, 2005 |                                            |   |
|------------------------|-------------------------------------------------|--------|
|                   |                                            |   |
|                   |                                            |   |
|                   | /s/ Chester L.F. Paulson                        |   |
|                   | (Chester L.F. Paulson)                          |   |
|                   | (President & Chief  Executive Officer) |   |

 

 

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