**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


Washington,
      D.C. 20549







**FORM
      10-QSB/A**





**(** **Amendment
      No** **.
      1)**




(Mark
      One)




x
            QUARTERLY
                REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
                1934
                FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2005




o
              TRANSITION
                  REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                  ACT OF
                  1934


For
      the
      Transition Period from ________ to ___________




Commission
      File No.:  0-29525




**DEBT
                RESOLVE, INC.**(Name
                of small business issuer in its charter)


**Delaware**
            **33-0889197**(State
                or other jurisdiction of incorporation or organization)
            (I.R.S.
                Employer Identification No.)**707
                Westchester Avenue, Suite L7****White
                Plains, New York**
            **10604**(Address
                of principal executive offices)
            (Zip
                Code)


**(914)
                949-5500**(Issuer’s
                telephone number)




Check
      whether the issuer (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.  x Yes  o
      No




As
      of
      August 22, 2005, 29,703,900 shares of the issuer’s Common Stock were issued and
      outstanding.




Transitional
      Small Business Disclosure Format (check one):  Yes o  No x











**EXPLANATORY
      NOTE**




Debt
      Resolve, Inc. (“Debt Resolve” or the “Company”) is filing this Amendment No. 1
      to its Quarterly Report on Form 10-QSB for the quarterly period ended June
      30,
      2005 (the “Form 10-QSB”), which was originally filed on August 22, 2005, solely
      to amend and replace Item 3 of the Form 10-QSB.




**Item
              3.**
            **Controls
                and Procedures**




**Evaluation
      of the Company’s Disclosure Controls and Procedures**




As
      of the
      end of the period covered by this report, the Company has evaluated the
      effectiveness of the design and operation of its disclosure controls and
      procedures (“disclosure controls”). This evaluation (the “controls evaluation”)
      was done under the supervision and participation of the Company’s management,
      including its Chief Executive Officer (the “CEO”), who is the Company’s
      principal executive officer, and its Chief Financial Officer (the “CFO”), who is
      the Company’s principal financial officer. Rules adopted by the Securities and
      Exchange Commission require  t hat
      in
      this section of the report the Company present the conclusions of its principal
      executive officer and principal financial officer about the effectiveness of
      the
      Company’s disclosure controls based on and as of the date of the controls
      evaluation.




**CEO
      and CFO Certifications**




Appearing
      as Exhibits 31.1 and 31.2 to this report are “Certifications” of the CEO and
      CFO. The certifications are required pursuant to Section 302 of the
      Sarbanes-Oxley Act of 2002 (the Section 302 Certifications”).




**Disclosure
      Controls**




Disclosure
      controls means controls and other procedures of the Company that are designed
      with the objective of ensuring that information required to be disclosed in
      the
      Company’s reports filed under the Securities Exchange Act, such as this report,
      is recorded, processed, summarized and reported within the time periods
      specified in the Securities and Exchange Commission’s rules and forms.
      Disclosure controls include, without limitation, controls and procedures
      designed to ensure that the information required to be disclosed by the Company
      in the reports that it files or submits under the Securities Exchange Act is
      accumulated and communicated to the Company’s management, including, without
      limitation, the CEO and CFO, as appropriate to allow timely decisions regarding
      required disclosure.




**Conclusions
      on the Effectiveness of Controls**




Based
      on
      their evaluations as of the end of the period covered in this report, the
      Company’s CEO and CFO concluded that the Company’s disclosure controls were not
      effective at the “reasonable assurance” level. The ineffectiveness of the
      Company’s disclosure controls is due to the matters described below in “Internal
      Control over Financial Reporting.”




The
      Company’s management, including, without limitation, the CEO and CFO, does not expect
      that the Company’s disclosure controls will prevent all error and fraud. A
      control system no matter how well conceived and operated can provide only
      reasonable, not absolute assurance that the objectives of the control system
      are
      met. Further, the design of a control system must reflect the fact that there
      are resource constraints and the benefits of controls must be considered
      relative to their costs. Because of the inherent limitations of all control
      systems, no evaluation of controls can provide absolute assurance that all
      control issues and instances of fraud, if any, within the Company have been
      detected.




**Scope
      of Evaluation**




The
      CEO/CFO evaluation of the Company’s disclosure controls included a review of the
      controls’ objective and design, the controls’ implementation by the Company and
      the effect of the controls on the information generated for use in this report.
      In the course of the controls evaluation, management sought to identify data
      errors, controls problems or acts of fraud and to confirm that appropriate corrective action, including process movements, were being
      undertaken. This type of evaluation will be done on a quarterly basis so that
      the conclusions concerning controls effectiveness can be reported in the
      Company’s quarterly reports on Form 10-QSB and annual report on Form 10-KSB. The
      overall goals of these various review and evaluation activities are to monitor
      the Company’s disclosure controls and to make modifications as necessary. In
      this regard, the Company’s intent is that the disclosure controls will be
      maintained as dynamic controls systems that change (including improvements
      and
      corrections) as conditions warrant.




-2-




**Internal
      Control over Financial Reporting**




The
      Company maintains a system of internal control over financial reporting, which
      is defined as a process designed by, or under the supervision of, the Company’s
      principal executive officer and principal financial officer, or persons
      performing similar functions, and effected by the Company’s board of directors,
      management and other personnel, to provide reasonable assurance regarding the
      reliability of financial reporting and the preparation of financial statements
      for external purposes in accordance with generally accepted accounting
      principles and includes those policies and procedures that: (1) pertain to
      the
      maintenance of records that in reasonable detail accurately and fairly reflect
      the transactions and dispositions of the assets of the Company, (2) provide
      reasonable assurance that transactions are recorded as necessary to permit
      preparation of financial statements in accordance with generally accepted
      accounting principles, and that receipts and expenditures of the Company are
      being made only in accordance with authorizations of management and directors
      of
      the Company, and (3) provide reasonable assurance regarding prevention or timely
      detection of unauthorized acquisition, use or disposition of the Company’s
      assets that could have a material effect on the financial
      statements.




The
      Company maintains accounting records that in reasonable detail accurately and fairly reflect
      the
      transactions and dispositions of the Company’s assets.
      T he
      Company has
      also established policies and procedures, including access controls, to p rovide
      reasonable assurance that transactions are recorded only as necessary to permit
      preparation of financial statements in accordance with generally accepted
      accounting principles, and that receipts and expenditures are made only in
      accordance with authorizations of management and directors. Access
      to
      assets is permitted only in accordance with management’s general or specific
      authorization. In addition, the recorded accountability for assets is compared
      with the existing assets at reasonable intervals and appropriate action is
      taken
      with respect to any differences.




As
      of the
      date of this report, t here
      have
      been certain positive changes in the Company’s internal control procedures that
      have improved those controls and related material weaknesses. Recently,
      the Company hired two additional, experienced accounting staff and enlisted
      the
      services of an experienced accounting consultant to assist with financial
      reporting issues. The Company has also begun to document and apply transactional
      and periodic controls procedures, including periodic closing check lists and
      sign-offs, permitting a better review and approval process and improved quality
      of accounting reports. The Company has also begun to prepare to meet the more
      rigid requirements of the Sarbanes-Oxley Act of 2002, performing research and
      analysis of the controls over expenditures and revenue recognition.




It
      is the
      responsibility of the Company’s management to establish and maintain adequate
      internal control over financial reporting. However, due to its small size and
      limited financial resources, the Company’s CEO and CFO have been the only
      employees principally involved in accounting and financial reporting. At the
      time of the material weakness noted below, both the bookkeeper and the CFO
      worked independently, from their homes and there was limited opportunity for
      a
      review and approval process. The Company’s audit committee has recognized that,
      as a result, there was inadequate segregation of duties within the accounting
      function, leaving most aspects of financial reporting in the hands of the CEO
      and CFO. Although the Company has recently hired two experienced employees
      to
      help with accounting duties, they are new to the Company and have taken on
      only
      limited duties. They provide some degree of segregation of duties over cash,
      however, and have begun to help write and implement documented control
      procedures. Combined with procedures already in place, and the information
      that,
      except for the items noted below, no other material errors or irregularities
      were noted during repeated re-reviews, the Company’s audit committee has
      confidence that there have been no irregularities in the Company’s financial
      reporting or in the protection of its assets.




The
      Company’s independent auditors reported to the Company’s audit committee certain
      matters involving internal controls that the Company’s independent auditors
      considered to be reportable conditions and a material weakness, under standards
      established by the American Institute of Certified Public Accountants. The
      reportable conditions and material weakness relate to the March 31, 2005,
      December 31, 2004 and 2003 financial close process and inadequate reviews and
      approvals of transactions and accounting entries as well as errors, related
      primarily to the accounting for stock options granted to consultants and
      advisory board members in lieu of compensation, which resulted in financial
      reports that are being restated for these periods. During those time periods,
      only a part-time CFO and bookkeeper provided the bulk of accounting controls
      and
      reports, with inadequate review and advisement concerning advanced accounting
      topics. The combination of this absence of a review and approval process,
      combined with the reporting errors, were sufficient to be deemed a material
      weakness. The adjustments related to these matters have been made by the Company
      in connection with the restatement of the audited financial statements for
      the
      year ended December 31, 2004 and 2003 and the quarterly statement for the period
      ended March 31, 2005. Although management has demonstrated certain improvements
      in controls over the preparation of its financial reports, as described above,
      these reported conditions and material weaknesses still exist, as the additional
      staff has only recently been hired, and new review procedures are incomplete
      and
      not all have been fully implemented. Management expects that most issues will
      be
      resolved by the time of the financial close process related to the filing of
      the
      Company’s Report on Form 10-KSB for the year ended December 31,
      2005.




-3-




Given
      these reportable conditions and material weakness, the Company’s management has
      devoted additional resources to resolving questions that arose during the audit
      review described above. The Company’s management believes that the reportable
      conditions noted above stem from the Company’s operational growth, and has
      committed to work closely with the Company’s audit committee to develop improved
      internal controls. Beginning over the summer of 2005, management committed
      to
      working with its audit committee to develop improved internal controls,
      including hiring additional accounting staff and documenting accounting control
      procedures in writing. The Company has also begun to prepare to meet the more
      rigid requirements of the Sarbanes-Oxley Act of 2002, performing analysis of
      the
      controls over expenditures and revenue recognition. Going forward, management
      is
      confident that the changes already begun, as well as other anticipated
      improvements, will correct any material issues. The costs associated with these
      efforts, primarily salaries and consulting fees, while material now, are not
      anticipated to be material to the Company when it achieves its anticipated
      revenue volumes in the coming years. Recently the Company hired two additional
      accounting staff, and it has begun to document and apply transactional and
      periodic controls procedures, permitting a better review and approval process
      and improved quality of accounting reports. The Company’s management believes
      that this new infrastructure will assist in alleviating control weaknesses
      going
      forward. As a result, the Company is confident that its financial statements
      for
      the three months and six months ended June 30, 2005 and 2004, fairly present,
      in
      all material respects, its financial condition and results of operations.




Commencing
      the year ending December 31, 2007, the Company will be required to document
      and
      test its internal control procedures in order to satisfy the requirements of
      Section 404 of the Sarbanes-Oxley Act of 2002, which requires annual management
      assessments of the effectiveness of the Company’s internal controls over
      financial reporting and a report by the Company’s independent registered public
      accounting firm addressing these assessments. The Company’s accounting staff is
      small, and although the Company recently begun to augment its internal controls
      procedures and expand its accounting staff, there is no guarantee that this
      effort will be adequate. During the course of its testing, the Company may
      identify deficiencies which it may not be able to remediate in time to meet
      the
      deadline imposed by the Sarbanes-Oxley Act for compliance with the requirements
      of Section 404. In addition, if the Company fails to maintain the adequacy
      of
      its internal accounting controls, as such standards are modified, supplemented
      or amended from time to time, it may not be able to ensure that it can conclude
      on an ongoing basis that it has effective internal controls over financial
      reporting in accordance with Section 404. Failure to achieve and maintain an
      effective internal control environment could also cause investors to lose
      confidence in the Company’s reported financial information.




-4-




**SIGNATURES**




In
      accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934,
      the
      Registrant caused this Report to be signed on its behalf by the undersigned,
      thereunto duly authorized.




**DEBT
                RESOLVE, INC.**Dated: 
                December 8, 2005
              By:
              /s/ JAMES
                D.
                BURCHETTAJames
                  D. Burchetta
                Co-Chairman, President and Chief Executive
                  Officer
                (principal executive
                  officer)
 By:
                /s/ KATHERINE
                  A. DERINGKatherine
                    A.
                    Dering
                  Chief Financial Officer, Treasurer and
                    Secretary
                  (principal financial and accounting
                    officer)


-5-