UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

(MARK ONE)

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

                  FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2005

                                       OR

[_]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
      EXCHANGE ACT OF 1934 [NO FEE REQUIRED]

        FOR THE TRANSITION PERIOD FROM ______________ TO _______________

                        COMMISSION FILE NUMBER 001-14911

                            JB OXFORD HOLDINGS, INC.
                        --------------------------------
             (Exact name of registrant as specified in its charter)

                UTAH                                  95-4099866
   (State of incorporation or organization)        (I.R.S. Employer
                                                  Identification No.)

       15165 Ventura Boulevard,
       Suite 330, Sherman Oaks, CA                      91403
  (Address of principal executive offices)            (Zip Code)

      Registrant's telephone number, including area code (818) 907-6580

      Indicate by check mark whether the Registrant: (l) has filed all reports
required to be filed by Section l3 or l5(d) of the Securities Exchange Act of
l934 during the preceding 12 months and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [_]

      Indicate by check mark whether the Registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act). Yes [_] No [X]

      Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date. As of August 1, 2005, the
Registrant had the following number of shares of common stock, $0.01 par value
per share, outstanding: 3,580,119.
<PAGE>

                         PART I - FINANCIAL INFORMATION


ITEM 1. FINANCIAL STATEMENTS

                    JB OXFORD HOLDINGS, INC. AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION


                                                         June 30,
                                                           2005     December 31,
                                                       (Unaudited)      2004
                                                       -----------  ------------
ASSETS:

  Cash and cash equivalents                            $ 7,185,502  $  5,270,077

  Cash segregated under federal and other regulations           --     3,132,172

  Receivable from broker-dealers                           101,373        99,608

  Receivable from customers                                     --           209

  Other receivables                                      3,922,755    12,413,265

  Securities owned - at market value                     6,024,708         9,825

  Notes receivable from shareholder                      2,500,000     2,500,000

  Investment in land                                     5,648,675     5,598,675

  Furniture, equipment, and leasehold improvements
   (at cost - net of accumulated depreciation and
   amortization of $468,168 and $344,347)                1,133,828     1,253,836

  Clearing deposits                                      4,212,120     4,652,541

  Other assets                                             541,830       671,561
                                                       -----------  ------------

  TOTAL ASSETS                                         $31,270,791  $ 35,601,769
                                                       ===========  ============

See accompanying notes.

                                       2
<PAGE>

                    JB OXFORD HOLDINGS, INC. AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION


                                                      June 30,
                                                       2005         December 31,
                                                    (Unaudited)        2004
                                                    ------------   ------------

LIABILITIES AND SHAREHOLDERS' EQUITY:

   LIABILITIES:

     Short term borrowings                          $  3,400,000   $  3,400,000

     Payable to broker-dealers and clearing
      organizations                                           --        160,543

     Payable to customers                                     --          7,071

     Income taxes payable                                  3,800        150,000

     Deferred taxes payable                               50,000        950,000

     Accounts payable and accrued liabilities          2,565,156      3,138,999

     Notes payable                                     2,889,375      3,292,153
                                                    ------------   ------------

   TOTAL LIABILITIES                                   8,908,331     11,098,766
                                                    ------------   ------------

   COMMITMENTS AND CONTINGENCIES

   SHAREHOLDERS' EQUITY:

     Common stock  ($.01 par value, 100,000,000
      shares authorized; 3,627,113 and 3,739,413
      shares issued)                                      36,271         37,394

     Additional paid-in capital                       22,974,695     23,282,397

     Retained earnings                                   264,695      2,096,413

     Treasury stock at cost, 46,994 shares              (913,201)      (913,201)
                                                    ------------   ------------

   TOTAL SHAREHOLDERS' EQUITY                         22,362,460     24,503,003
                                                    ------------   ------------

   TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY       $ 31,270,791   $ 35,601,769
                                                    ============   ============

See accompanying notes.

                                       3
<PAGE>

                    JB OXFORD HOLDINGS, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                            Six Months Ended June 30,       Quarter Ended June 30,
                                               2005           2004           2005           2004
                                           ------------   ------------   ------------   ------------
<S>                                        <C>            <C>            <C>            <C>
REVENUES:
   Brokerage                               $    458,975   $     71,753   $    179,617   $     43,292
   Other                                        264,028             --        239,049             --
                                           ------------   ------------   ------------   ------------
   Total revenues                               723,003         71,753        418,666         43,292
                                           ------------   ------------   ------------   ------------

EXPENSES:
   General and administrative                 3,444,729      2,664,766      1,920,191      1,405,195
   Depreciation and amortization                123,821        272,341         61,920        128,771
                                           ------------   ------------   ------------   ------------
   Total expenses                             3,568,550      2,937,107      1,982,111      1,533,966
                                           ------------   ------------   ------------   ------------
   Loss from continuing operations before
     interest and taxes                      (2,845,547)    (2,865,354)    (1,563,445)    (1,490,674)
                                           ------------   ------------   ------------   ------------
     Interest revenue                           302,656        115,787        175,420         57,865

     Interest expense                            95,603        321,778         49,872        160,889
                                           ------------   ------------   ------------   ------------
       Net Interest                             207,053       (205,991)       125,458       (103,024)
                                           ------------   ------------   ------------   ------------
   Loss from continuing operations before
     taxes                                   (2,638,494)    (3,071,345)    (1,437,897)    (1,593,698)

     Income tax expense (benefit)              (899,465)         6,100       (549,452)         5,700
                                           ------------   ------------   ------------   ------------

   Net loss from continuing operations       (1,739,029)    (3,077,445)      (888,445)    (1,599,398)
                                           ------------   ------------   ------------   ------------
     Loss from discontinued operations          (92,689)      (871,114)      (225,548)      (159,529)

     Income tax expense (benefit)                    --          6,200             --          4,400
                                           ------------   ------------   ------------   ------------

   Net loss from discontinued operations        (92,689)      (877,314)      (225,548)      (163,929)
                                           ------------   ------------   ------------   ------------

   Net loss                                $ (1,831,718)  $ (3,954,759)  $ (1,113,993)  $ (1,763,327)
                                           ============   ============   ============   ============

Basic net income (loss) per share:
   From continuing operations              $      (0.48)  $      (1.70)  $      (0.25)  $      (0.87)
   From discontinued operations                   (0.03)         (0.48)         (0.06)         (0.09)

   Basic net income (loss) per share              (0.51)         (2.18)         (0.31)         (0.96)

Diluted net income (loss) per share:
   From continuing operations                     (0.48)         (1.70)         (0.25)         (0.87)
   From discontinued operations                   (0.03)         (0.48)         (0.06)         (0.09)

   Diluted net income (loss) per share            (0.51)         (2.18)         (0.31)         (0.96)

Weighted average number of shares
      Basic                                   3,621,068      1,814,256      3,580,119      1,841,749
      Diluted                                 3,621,068      1,814,256      3,580,119      1,841,749
</TABLE>


See accompanying notes.

                                       4
<PAGE>

                    JB OXFORD HOLDINGS, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                   For The Six Months Ended
                                                                           June 30,
                                                                 ---------------------------
                                                                     2005           2004
                                                                 ------------   ------------


<S>                                                              <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net loss                                                       $ (1,831,718)  $ (3,954,759)
  Adjustments to reconcile net loss to cash
   provided by (used in)operating activities:
     Depreciation and amortization                                    123,821      1,064,674
     Provision for bad debts                                               --         38,735
     Deferred income taxes, net                                      (900,000)            --
     Gain on disposal of clearing operation                          (326,031)            --
   Changes in assets and liabilities:
     Cash segregated under federal and other regulations            3,132,172     21,012,946
     Receivable from broker-dealers and clearing organizations         (1,765)    12,613,801
     Receivable from customers                                            209    (14,139,314)
     Other receivables                                                120,510      1,315,127
     Securities owned                                                   9,825       (444,238)
     Clearing deposits                                                440,421      1,410,003
     Other assets                                                     129,731       (338,958)
     Payable to broker-dealers and clearing organizations            (160,543)    (5,145,865)
     Payable to customers                                              (7,071)   (14,553,426)
     Securities sold, not yet purchased                                    --     (1,956,525)
     Accounts payable and accrued liabilities                        (573,843)      (554,276)
     Income taxes, net                                               (146,200)            --
                                                                 ------------   ------------
Net cash provided by (used in) operating activities                     9,518     (3,632,075)
                                                                 ------------   ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Capital expenditures                                                 (3,813)      (215,946)
  Investment in marketable securities                              (6,024,708)
  Investment in land                                                  (50,000)            --
  Sale of clearing and retail brokerage operations                  8,696,031             --
  Acquisition and retirement of 112,300 share of treasury stock      (308,825)            --
                                                                 ------------   ------------
Net provided by (cash used) in investing activities                 2,308,685       (215,946)
                                                                 ------------   ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
 Repayments of notes payable                                         (402,778)       (83,333)
                                                                 ------------   ------------
Net cash used in financing activities                                (402,778)       (83,333)
                                                                 ------------   ------------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                1,915,425     (3,931,354)
CASH AND CASH EQUIVALENTS AT BEGINNING OF THE PERIOD                5,270,077      6,897,970
                                                                 ------------   ------------
CASH AND CASH EQUIVALENTS AT END OF THE PERIOD                   $  7,185,502   $  2,966,616
                                                                 ============   ============
</TABLE>


See accompanying notes.

                                       5
<PAGE>

JB OXFORD HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

NOTE 1. COMPANY'S QUARTERLY REPORT UNDER FORM 10-Q

        In the opinion of Management, the accompanying unaudited consolidated
financial statements contain all adjustments necessary to present fairly the
consolidated financial statements of JB Oxford Holdings, Inc. and subsidiaries
(the "Company") for the periods presented. The results of operations for the
interim periods presented are not necessarily indicative of the results to be
expected for the full year. The accompanying consolidated financial information
should be read in conjunction with the Company's 2004 Annual Report on
Securities and Exchange Commission ("SEC") Form 10-K. Footnote disclosures that
substantially duplicate those in the Company's Annual Report on Form 10-K,
including significant accounting policies, have been omitted. Reclassification
adjustments have been made to prior periods to make the presentation of the
financial statements consistent.

        The accompanying consolidated financial statements have been prepared on
a going concern basis, which reflects the realization of assets and the
satisfaction of liabilities in the normal course of business. The Company has
incurred recurring operating losses and has significant pending litigation.
Further, there is significant uncertainty with respect to the outcome of a
pending SEC lawsuit regarding alleged late trading of mutual funds conducted by
the Company. The report of the Company's independent registered public
accounting firm for the year ended December 31, 2004, included an explanatory
paragraph expressing substantial doubt about the Company's ability to continue
as a going concern.

        The accompanying consolidated financial statements do not include any
adjustments relating to the possible future effects on the recoverability and
classification of assets or the amounts and classification of liabilities that
might be necessary should the Company file for protection under Chapter 11 or be
unable to continue as a going concern.

        During the year ended December 31, 2004, the Company sold substantially
all of its revenue producing operations. Effective September 2004, National
Clearing Corp ("NCC") sold its correspondent clearing operation and effective
October 2004, JB Oxford & Company ("JBOC") sold its retail brokerage operation.
NCC still maintains a small institutional brokerage and market making operation,
with the market making operation making 10 or less markets, to facilitate the
securities transactions of our institutional clients. The Company has also
acquired land as an investment, which we may or may not develop and an aircraft
to assist management with the current investment, as well as to examine
additional potential investments. This new investment could create a separately
identifiable segment with which to report operations of in future periods. This
potential segment is only comprised of these assets and consequently separate
segment disclosure has not been made. The Company has incurred approximately
$230,000 of costs related to this new activity in the first half of 2005, with
no related revenues. During the periods presented, the Company generated
revenues in a single industry, the securities industry. During 2004, the Company
derived its revenues primarily from its retail brokerage services operations in
JBOC, and its correspondent clearing services and market making activities at
NCC. These operations are reported as discontinued operation in the accompanying
statement of operations, see Note 4 for

                                       6
<PAGE>

further discussion of discontinued operations. In 2005, the Company generated
revenues from its institutional brokerage operation in NCC and revenues from its
cash investments. Inter-company balances have been eliminated in the
consolidated financial statements.

NOTE 2. EARNINGS PER SHARE

        The following table reconciles the numerators and denominators of the
basic and diluted earnings per share computation:

<TABLE>
<CAPTION>
                                                  For The Six Months Ended       For The Three Months Ended
                                                          June 30,                        June 30,
                                                    2005           2004             2005           2004
                                               -------------   -------------   -------------   -------------
<S>                                            <C>             <C>             <C>             <C>
BASIC EARNINGS PER SHARE:
   Net loss                                    $  (1,831,718)  $  (3,954,759)  $  (1,113,993)  $  (1,763,327)
                                               -------------   -------------   -------------   -------------
   Loss available to common stockholders       $  (1,831,718)  $  (3,954,759)  $  (1,113,993)  $  (1,763,327)
     (numerator)
                                               =============   =============   =============   =============
   Weighted average common shares outstanding
     (denominator)                                 3,621,068       1,814,256       3,580,119       1,841,749
                                               =============   =============   =============   =============
   Basic earnings per share                    $       (0.51)  $       (2.18)  $       (0.31)  $       (0.96)
                                               =============   =============   =============   =============

DILUTED EARNINGS PER SHARE:
   Net Loss                                    $  (1,831,718)  $  (3,954,759)  $  (1,113,993)  $  (1,763,327)
                                               -------------   -------------   -------------   -------------
   Loss available to common stockholders plus
     assumed conversions (numerator)           $  (1,831,718)  $  (3,954,759)  $  (1,113,993)  $  (1,763,327)
                                               =============   =============   =============   =============
   Weighted average common shares outstanding      3,621,068       1,814,256       3,580,119      1, 841,749
                                               -------------   -------------   -------------   -------------
   Weighted average common shares and assumed
     conversions outstanding (denominator)         3,621,068       1,814,256       3,580,119      1, 841,749
                                               =============   =============   =============   =============
   Diluted earnings per share                  $       (0.51)  $       (2.18)  $       (0.31)  $       (0.96)
                                               =============   =============   =============   =============
</TABLE>


        The assumed conversions have been excluded in computing the diluted
earnings per share when there is a net loss for the period ended June 30, 2004.
They have been excluded because their inclusion would reduce the loss per share
or be anti-dilutive. If the assumed conversions were used, the fully diluted
shares outstanding for the six months ended June 30, 2004 would be 3,846,239.
There were no common stock equivalents or assumed conversions for the six months
ended June 30, 2005 as none of the stock options have a strike price less than
the average market price for the period.

        Stock options outstanding carry exercise prices ranging from $2.20 to
$91.25 at June 30, 2005 and 2004. Options to purchase 144,250 shares of common
stock were outstanding at June 30, 2005 expire at various dates
through October 4, 2012.

                                       7
<PAGE>

NOTE 3. EQUITY TRANSACTIONS AND STOCK OPTIONS

        During the first quarter of 2005, the Company acquired 112,300 shares of
common stock in connection with the final resolution of all matters related to
the Mr. Stock acquisition. The shares were acquired at an effective average
price of $2.89 per share, based upon mutual agreement of the parties and
settlement of all other remaining issues. The retirement of the stock was
recorded at a cost of $2.75 per share representing the fair market value on the
day the shares were acquired and $16,175 was accrued as an expense at December
31, 2004. The buy back resulted in the reduction of common stock of $1,123 and
additional paid in capital of $307,702 in the first quarter of 2005. The shares
have been returned to the Company and cancelled as of March 31, 2005.

        During the first quarter of 2004, the Company issued 132,244 shares of
common stock related to the acquisition of intangible assets in the amount of
$466,667 in connection with the Mr. Stock transaction. The average closing
market price for the ten days prior to issuance was used to determine the number
of shares issued. The $466,667 was previously included in accounts payable prior
to issuance. See "Litigation Related to Account Acquisitions" included at Note 6
for additional information.

        In September 2004, Third Capital Partners converted the notes then held
by it into 2,029,474 shares of our common stock. As a result of the conversion,
Third Capital Partners owns approximately 57% of our common stock.

        SFAS No.123, "Accounting for Stock-Based Compensation," requires the
Company to provide pro forma information regarding net income and earnings per
share in accordance with the compensation-based method prescribed in SFAS No.
123. SFAS No. 148, "Accounting for Stock-Based Compensation - Transition and
Disclosure," requires the Company to provide information required by SFAS 123 on
a quarterly basis. No options were issued during the six months ended June 30,
2005 and 2004; and there is no pro forma attribution expense on previously
issued options for those respective periods. A summary of the status of the
Company's stock options as of June 30, 2005 and 2004, and changes during the
periods ending on those dates is presented below:

                                      June 30, 2005           June 30, 2004
                                              Weighted                Weighted
                                   Shares     average     Shares       average
                                 ----------  ----------  ---------    ---------
Outstanding at                      144,250  $    16.05     256,825   $    15.66
  be-ginning of period
Forfeited                                --          --        (225)       41.94
                                 ----------  ----------  ---------    ---------
Outstanding at end of
  period                            144,250       16.05     256,600        15.63
                                 ==========  ==========   ==========  ==========
Options exercisable                 144,250       16.05     256,600        15.63
  at quarter-end
Weighted-average fair
  value of options
  granted during the
  period                         $       --              $       --

                                       8
<PAGE>


NOTE 4. DISCONTINUED OPERATIONS

        On June 4, 2004, the Company signed an asset purchase agreement with
Ameritrade, Inc., a subsidiary of Ameritrade Holding Corporation, to sell the
online retail accounts of JB Oxford & Company ("JBOC"), a subsidiary of JB
Oxford Holdings, Inc. for up to $26 million in cash, subject to certain
adjustments and an escrow. That transaction closed on October 8, 2004, with the
final purchase price fixed at $25.87 million. The Company received the initial
payment of $14 million in 2004, and received the second payment of $8.37 million
in January 2005. The final payment of $3.5 million is due to be received in
April 2006.

        On August 20, 2004, the Company entered into an agreement with North
American Clearing, Inc. to sell all of its clearing rights for the correspondent
accounts of its wholly-owned subsidiary National Clearing Corp. ("NCC"). Under
the terms of the agreement, the Company received an initial payment of $100,000
in October 2004, and will receive 50% of the revenue related to the transferred
correspondent accounts over the next five years, up to a maximum total payment
of $2.5 million. Gain on disposal of clearing operation of $326,031 is included
in discontinued operations for the period ended June 30, 2005.

        These asset groups are the brokerage operations (both clearing and
retail brokerage segments) of the Company and provided substantially all of its
operating revenues in 2004. These asset groups met the criteria defined by SFAS
No. 144 to be reported as discontinued operations as of June 30, 2004. Certain
expenses, particularly professional fees, including legal defense costs, which
are related to the discontinued operations, but remain as obligations of the
Company after completion of the asset sales, are reported in ongoing operations.

        The following table reflects detailed amounts of revenue, expense and
loss reported in discontinued operations for the respective periods ended June
30, 2005 and 2004. Operations previously reported have been restated to reflect
the change in status to discontinued operations.

                                       9
<PAGE>

<TABLE>
<CAPTION>
                                        For The Six Months Ended     For The Three Months Ended
                                                 June 30,                     June 30,
                                          2005           2004           2005           2004
                                      ------------   ------------   ------------   ------------
<S>                                   <C>            <C>            <C>            <C>
REVENUES:
   Commissions                                  --   $  3,969,266             --   $  1,707,257
   Interest                                     --      2,632,447             --      1,356,652
   Trading profits                          (4,296)       206,747             --        180,105
   Clearing and execution                       --      1,186,763             --        627,419
   Other                                   276,642         64,010             --         45,602
                                      ------------   ------------   ------------   ------------

      Total revenues                       272,346      8,059,233             --      3,917,035
                                      ------------   ------------   ------------   ------------

EXPENSES:
   Employee compensation                        --      2,959,932             --      1,523,796
   Clearing and floor brokerage              7,295        495,636             --        228,975
   Communications                           38,512      1,076,287          3,000        487,872
   Occupancy and equipment                 127,092      1,467,669         61,064        661,746
   Interest                                     --        198,096             --        101,865
   Data processing charges                 455,657      1,172,784        232,386        502,782
   Professional services                     9,050         85,065             --             --
   Promotional                                 885        138,333             --         49,943
   Bad debts                                    --         38,735             --         16,697
   Amortization of intangible assets            --        454,586             --        113,647
   Other operating expenses                 52,574        843,224         34,716        389,242
                                      ------------   ------------   ------------   ------------

      Total Expenses                       691,066      8,930,347        331,166      4,076,564
                                      ------------   ------------   ------------   ------------
   Loss before disposal of operating      (418,720)      (871,114)      (331,166)      (159,529)
assets and taxes
   Gain on disposal of clearing
operation                                  326,031             --        105,618             --
   Income tax expense (benefit)                 --          6,200             --          4,400
                                      ------------   ------------   ------------   ------------

   Loss from discontinued operations  $    (92,689)  $   (877,314)  $   (225,548)  $   (163,929)
                                      ============   ============   ============   ============
</TABLE>

NOTE 5. REGULATORY REQUIREMENTS

      NCC is subject to the SEC's Uniform Net Capital Rule ("the Rule"), which
requires the maintenance of minimum net capital. The Rule requires NCC to
maintain minimum net capital, as defined, equal to the greater of $250,000 or 6
2/3 percent of aggregate indebtedness, as defined. At December 2004, NCC had
elected the alternative method to compute its minimum net capital

                                       10
<PAGE>

requirement. The alternative method requires the greater of $250,000 or two
percent of aggregate debit balances arising from customer transactions, as
defined. NCC no longer carried customer balances and used the aggregate
indebtedness standard to compute its minimum net capital requirement at June 30,
2005. This method requires maintenance of minimum net capital of not less than 6
2/3% of aggregate indebtedness, as defined.

      At June 30, 2005, NCC had net capital of $1,640,536, which was $1,332,427
in excess of the minimum amount required and 35% of aggregate indebtedness with
ratio of aggregate indebtedness to net capital of 2.8 to 1. At December 31,
2004, NCC had net capital of $2,640,170, which was $2,390,170 in excess of the
$250,000 minimum required.

NOTE 6. CONTINGENT LIABILITIES

      The Company is a party to a number of pending legal, arbitration or
administrative proceedings incidental to its business, including customer claims
regarding brokerage transactions, and claims related to clearing services
arising out of the failure of certain correspondent firms. All of the legal,
arbitration and administrative proceedings have arisen in the ordinary conduct
of its business. Those proceedings that management believes may have a
significant impact on the Company are described below. However, there can be no
assurance that in the future, other current or future proceedings will not have
a material adverse effect on the Company's financial condition or results of
operations. In particular, if the Company is required to pay a judgment in
excess of the amount reserved, such a payment would negatively impact the
financial condition of the Company. However, the Company regularly assesses its
potential liability in all pending litigation to properly set the level of
reserves for such litigation. To the extent that the reserves are sufficient to
cover all awards and settlements, no currently threatened or pending litigation
should materially impact the Company's financial position, results of operations
or cash flows. The Company's aggregate reserve for pending litigation was
$456,948 as of June 30, 2005.

SEC MUTUAL FUND LAWSUIT

      On or about August 24, 2004, the SEC's Los Angeles Office commenced a
civil lawsuit against the Company, NCC, and three of its former officers and
employees, alleging violations of Section 17(a) of the Securities Act of 1933,
Section 10(b) of the Exchange Act of 1934 and Rule 10b-5 thereunder, and Section
22(c) of the Investment Company Act of 1940 and Rule 22c-1 thereunder. In
January 2005, all claims under Section 17(a) of the Securities Act of 1933 were
dismissed by the Court, with prejudice. The remaining claims remain pending. The
suit seeks unspecified monetary damages and penalties, as well as other remedies
against the individual defendants. The suit contends that the Company wrongfully
allowed customers to place mutual fund trades after 4:00 p.m. EST, and
wrongfully assisted clients in "market timing" of mutual funds. While the
Company admits no wrongdoing and intends to vigorously defend itself, no
assurance can be given as to the outcome of this matter. Although the likelihood
of loss is reasonably possible, the Company has not accrued any specific amount
related to this matter, as no amount of loss in the Company's estimated range of
loss of zero to $20 million is more likely than another.

LITIGATION RELATED TO OERI NOTES

      The Company is a party to a lawsuit entitled EBC Trust v. JB Oxford
Holdings, Inc., et als., pending in the Federal District Court in Los Angeles.
In this suit, EBC Trust is seeking payment of the $2.9 million in notes payable.
In July 2002, the court magistrate granted a pre-judgment attachment against the
assets of the Company in favor of EBC Trust. In January 2003, the Court

                                       11
<PAGE>

reversed the magistrate's order and dissolved the attachment. In January 2003,
EBC Trust amended its claim to assert additional claims against the Company and
to add claims against the officers and directors of the Company, as well as to
add a claim against NCC under the $1,000,000 Oeri subordinated note. By Order
dated October 14, 2003, in response to motions filed by the Company, the Court
dismissed several claims, struck portions of the Amended Complaint, and
compelled EBC Trust to arbitrate all claims against NCC.

      As to the remaining claims, the Company has asserted a number of defenses
to EBC Trust's claims, including fraud, and contribution related to a judgment
entered against EBC Trust's predecessor-in-interest under the notes payable and
NCC in an NASD arbitration commenced by Stanley J. Cohen, Receiver for Secured
Equity Title and Appraisal Agency Corp. While nominally a clearing case, the
panel ruling relied primarily on testimony regarding the activities of Irving
Kott while present at the Company. Mr. Kott is alleged to have provided most of
the funds for the loans now being pursued by EBC Trust. NCC settled all of the
claims against it in that matter in 2002, and as a part of that settlement,
obtained the assignment from Secured Equity of a Judgment against Oeri Finance,
Inc. Accordingly, the Company has asserted a claim of offset for the Judgment
against Oeri Finance, Inc. The Company has recorded liabilities of approximately
$2.9 million on its balance sheet in notes payable, additionally, the Company
has $816,429 of accrued interest related to these notes included in accounts
payable and accrued expenses. The Company has not yet recorded the offset of the
judgment obtained in its financial statements, since the matter has not yet been
adjudicated.

      In December 2003, EBC Trust commenced an arbitration action with the
National Association of Securities Dealers, Inc., against JBOC, seeking recovery
on the $1,000,000 subordinated note originally issued to RMS Network, Inc., and
subsequently assigned with approval from the Company and the NASD to Oeri
Finance, Inc. The Company intends to vigorously defend the action and believes
that it has meritorious defenses including, without limitation: i) the suit is
brought against the wrong party; ii) no valid assignment has ever been approved
by the Company or the NASD to EBC Trust, as required by the terms of the note;
and iii) the Company will assert an offset for the Judgment obtained against
Oeri Finance, Inc., described above.

 LITIGATION RELATED TO ACCOUNT ACQUISITIONS

      In October 2002, Share King LLC, as successor to Mr. Stock, Inc. commenced
an arbitration proceeding related to the acquisition by us of the accounts of
Mr. Stock. We counter sued for violations of the purchase agreement by Mr.
Stock. The main issue in the dispute related to whether and when Mr. Stock had
met all of the necessary conditions precedent to the formal closing of the
transaction, as calculation of the amount to be paid was based on when the
closing occurred. The key condition in dispute was whether and when certain
required computer programming was completed by Mr. Stock. That litigation was
settled in August 2003, on terms more favorable to us than we originally accrued
for, and the cost of the Mr. Stock acquisition was adjusted down $356,174 in
2003, as a result of settlement of the arbitration. As a part of the settlement,
we are required to distribute cash and/or stock, at our election to Share King
LLC. In early 2004, a further dispute arose with Share King LLC regarding the
registration requirements related to stock issued and to be issued. That dispute
was resolved and a cash payment of $1,400,000 was made to Share King, LLC in
November 2004. 178,804 shares of the Company's common stock were reacquired in

                                       12
<PAGE>

the transaction, and cancelled by the Company, of which 132,244 and 46,560
shares were issued in 2004 and 2003, respectively.

      In a related action commenced in January 2005, OCC Venture, LLC commenced
suit against Share King LLC and us alleging breach of the lease buyout
agreement. In March 2005, we reached a settlement with OCC Venture, pursuant to
which we have made payments totaling $686,111, of which $361,111 represented the
balance due on the note payable to them. In exchange, we have received a return
of 112,300 shares of our common stock, and a release of the outstanding note to
OCC Venture. The Company accrued a loss of approximately $16,000 for the premium
paid in excess of market value for the 112,300 shares at December 31, 2004.

NOTE 7. SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

                                                     For The Six Months
                                                        Ended June 30,
                                                   ----------------------
                                                      2005        2004
                                                   ----------  ----------
Supplemental Disclosures of Cash Flow Information
    Cash paid for:
        Interest                                   $   78,903  $  386,312
        Income taxes                                  146,200      12,300


Supplemental disclosure of non-cash investing and financing activities:
----------------------------------------------------------------------

      o     Treasury stock bonus issued to employees in the amount of $115,514
            in 2004.

      o     Common stock issued to acquire intangible assets in the amount of
            $466,667 for 2004 (See Note 3 Equity Transactions and Stock
            Options).

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

Special Note Regarding Forward-Looking Statements
-------------------------------------------------

Certain statements in this Quarterly Report on Form 10-Q, particularly under
Items 2 and 3, as well as certain information provided periodically in writing
or orally by us, constitute "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995. These forward-looking
statements involve known and unknown risks, uncertainties, and other factors
which may cause the actual results, performance, or achievements of the Company
to be materially different from any future results, performance, or
achievements, expressed or implied by such forward-looking statements.

Business Overview
-----------------

Through our wholly-owned subsidiaries, we were previously engaged in the
business of providing brokerage and related financial services to retail
customers and broker-dealers nationwide. With the completion of the transactions
with Ameritrade, Inc. and North American Clearing, our brokerage operations are
now limited to providing market making and institutional trading services only.
See Note 4, Discontinued Operations. Our business is headquartered in Los
Angeles, California.

                                       13
<PAGE>

Our Board of Directors approved a new business plan for our JB Oxford & Company
subsidiary in May 2005. Under the new business plan, JBOC will focus primarily
on the acquisition of real estate for investment and/or development. In the
fourth quarter of 2004, we made our first investment in real estate, through the
purchase of raw land in Destin, Florida. While we will continue to look at
investments in other market sectors, including the possibility of acquiring an
operating business, our primary focus at this time is in making investments in
real estate, both for investment and development purposes.

Recent Developments
-------------------

On May 16, 2005, our Board approved a new business plan, as stated above. In
addition to continuing our limited brokerage business, our primary focus is now
the purchase and sale of real estate for investment and/or development purposes.
In addition, we reserve the right to make investments in other areas, including
the possibility of investing in other operating entities.

On July 7, 2005, we filed a Preliminary Information Statement for shareholder
approval of a 1 for 100 share reverse split, the effect of which will be to
reduce the number of remaining shareholders, as counted for SEC purposes, below
300, thereby resulting in the Company ceasing to be a public reporting company,
and likely resulting in the Company being de-listed from the NASDAQ SmallCap
Market. The Company has indicated its intent to continue to publicly provide all
information required to allow brokers to publish bid and ask prices on
PinkSheets LLC.

Investment Activities
---------------------

Our JBOC subsidiary received $14 million in October 2004 from the sale of assets
to Ameritrade, Inc. In January 2005, we received an additional $8.3 million. The
final payment of $3.5 million is held in escrow under the terms of the Asset
Purchase Agreement with Ameritrade and is payable in 2006, less the amount of
any liabilities to Ameritrade thereunder. The sale proceeds, less operating
expenses to date, are available for investment.

On December 2, 2004, the Company, through a new 99.9% owned subsidiary of JBOC,
Dolphin Bay, LLC, acquired approximately 10 acres of undeveloped land in Destin,
Florida, for $5.5 million. The Company has not determined whether to hold the
land for short-term appreciation, longer-term appreciation or development. We
did not acquire any additional property in the first half of 2005.

Market Making Activities
------------------------

In order to facilitate the execution of security transactions for our own
customers, NCC acts as a market maker for approximately 10 public corporations
whose stocks are traded through the PinkSheets LLC. The number of companies in
which NCC acts as a market maker fluctuates depending upon various factors,
including trading volume and the number of employees in a trading capacity. Our
market making activities concentrate on the execution of unsolicited
transactions for customers and are required to be in compliance with the rules
of the National Association of Securities Dealers, Inc. ("NASD") regarding best
execution.

                                       14
<PAGE>

Results of Operations
---------------------

Six Months Ended June 30, 2005 Compared with Six Months Ended June 30, 2004
---------------------------------------------------------------------------

Continuing Operations
---------------------

Revenues from ongoing institutional sales and trading services provided $458,975
in brokerage revenue for the six months ended June 30, 2005 as compared to
$71,753 for the same period in 2004. The Company started to provide these
services in March 2004. Interest earned for the six months ended June 30, 2005
amounted to $302,656 as compared to $115,787 for the same period in 2004.

Our general and administrative expense increased by $779,963 or 29% to
$3,444,729 in the first six months of 2005 from $2,664,766 in the first six
months of 2004. This increase resulted primarily from employee compensation that
increased $512,518 to $623,688 in the first six months of 2005 from $111,170 in
the first six months of 2004. This increase is primarily the result of an
increase in broker salary and commission from the institutional sales operation
in the amount of $254,446. General and administrative expenses consist primarily
of legal fees of $2,282,989 and $2,391,907 for the six months ended June 30,
2005 and 2004, respectively, related to legal matters as discussed in Note 6 to
the consolidated financial statements.

We recognized a tax benefit of $899,465 in the first half of 2005, which was the
reversal of deferred tax credits, as compared to an income tax expense of $6,100
for the same period in 2004.

Our loss from continuing operations decreased 44% to $1,739,029 for the period
ended June 30, 2005 compared to $3,077,445 for the period ended June 30, 2004.
$899,465 of this decrease was the change in the provision (benefit) for income
taxes in the respective periods.

Discontinued Operations
-----------------------

Discontinued operations generated a net loss of $92,689 in the first half of
2005 compared to $877,314 in the first half of 2004. This is a change of
$784,625 or 89% decrease in the loss.

Revenues from Discontinued Operations
-------------------------------------

Our total discontinued brokerage revenues totaled $272,346 for the first six
months of 2005, as compared $8,059,233 in the first six months of 2004.
Operations for the retail and clearing operations ceased in the fourth quarter
of 2004. The primary source of discontinued operations revenue for the period
ended June 30, 2005 is the result of our sales of security positions. The
positions consisted of low priced securities which are not widely traded.

Expenses from Discontinued Operations
-------------------------------------

Our total discontinued brokerage expenses totaled $691,066 for the first six
months of 2005, as compared $8,930,347 in the first six months of 2004. As
described above, operations for the retail and clearing operations ceased in the
fourth quarter of 2004. The primary source of operations expense for the period
ended June 30, 2005 is data processing charges of $455,657. This commitment
ended June 2005, at such time we completed our filing of information tax returns
for

                                       15
<PAGE>

our former retail customers. Additionally, we had rent and maintenance expense
for our former New York office totaling $127,092 for the six months ended June
30, 2005, net of $102,720 sub rental payments received.

Gain on Disposal of Operating Assets
------------------------------------

Included in the discontinued operation for the period ended June 30, 2005 is
$326,031 from the sale of our clearing operation. We expect these proceeds to
continue on a gradually declining basis.

Quarter Ended June 30, 2005 Compared with Quarter Ended June 30, 2004
---------------------------------------------------------------------

Continuing Operations
---------------------

Revenues from our institutional sales and trading services provided $179,617 in
brokerage revenue for the quarter ended June 30, 2005 as compared to $43,292 for
the same period in 2004. Interest earned for the quarter ended June 30, 2005
amounted to $175,420 as compared to $57,865 for the same period in 2004.

Our general and administrative expense increased by $514,996 or 37% to
$1,920,191 in the second quarter of 2005 from $1,405,195 in the second quarter
of 2004. This increase resulted from professional fees that increased $89,492 to
$1,334,936 in the second quarter of 2005 from $1,245,444 in the second of 2004.
These fees were incurred due to the SEC mutual fund investigation and the
litigation related to the Oeri notes. See Note 6 above. General and
administrative expenses included employee compensation of $292,484 and $57,478
for the three months ended June 30, 2005 and 2004, respectively. This increase
is primarily the result of an increase in broker salary and commission from the
institutional sales operation in the amount of $109,801.

Discontinued Operations
-----------------------

We recorded a net loss from discontinued operations of $225,548 for the quarter
ended June 30, 2005. This compares with a net loss of $163,929 for the quarter
ended June 30, 2004.

Revenues from Discontinued Operations
-------------------------------------

Our total discontinued brokerage revenues had no revenues in the second quarter
of 2005, as compared $3,917,035 in the second quarter of 2004, as detailed in
Note 4 to the consolidated financial statements. Operations for the retail and
clearing operations ceased in the fourth quarter of 2004.

Expenses from Discontinued Operations
-------------------------------------

Our total discontinued brokerage expenses totaled $331,166 for the second
quarter of 2005, as compared $4,076,564 for the same period in 2004. The primary
source of operations expense for the quarter ended June 30, 2005 is data
processing charges of $232,386. This commitment ended June 2005, as explained
ablove. Rent and maintenance expense for our former New York office totaled
$61,064 for the quarter ended June 30, 2005, net of $55,007 sub rental payments
received.

                                       16
<PAGE>

Gain on Disposal of Operating Assets
------------------------------------

Included in the discontinued operation for the period ended June 30, 2005 is
$105,618 from the sale of our clearing operation. We expect these proceeds to
continue on a gradually declining basis.

Liquidity and Capital Resources
-------------------------------

During the year ended December 31, 2004, we sold substantially all of our
revenue producing operations. Effective September 2004, we sold our
correspondent clearing operation of National Clearing Corporation and effective
October 2004, we sold our retail brokerage operation of JB Oxford & Company.
These transactions have added liquidity to our current financial position,
however we currently have no significant operations that generate cash. As of
June 30, 2005, we have $7,185,502 in available cash, and additionally we have
$6,024,708 in US Government securities which are readily marketable. We received
and additional $8,370,000 in January 2005 from the sale of retail accounts to
Ameritrade and expect to receive and additional $3,500,000 in April 2006.

NCC is subject to the requirements of the NASD and the SEC relating to
liquidity, net capital, and the use of customer cash and securities. (See Note
5. "Regulatory Requirements" to the consolidated financial statements.) At June
30, 2005, NCC had net capital of $1,640,536, which was $1,332,427 in excess of
the minimum amount required. At December 31, 2004, NCC had net capital of
$2,640,170, which was $2,390,170 in excess of the $250,000 minimum required.
Because NCC is subject to the Net Capital Rule, there are restrictions on
advances to affiliates, repayment of subordinated liabilities, dividend payments
and other equity withdrawals that are subject to regulatory notification.

We expect our current cash resources to be sufficient to fund our expected
working capital and capital expenditure requirements for the current calendar
year. We have no current commitments for capital resources; we did however
acquire an aircraft for $1,115,000 at the end of 2004. It is currently
anticipated that we will use approximately $4,400,000 of cash in operations for
the calendar year 2005 in our core brokerage operations, excluding any proceeds
we may realize from the sale of our investment in land or any costs we may incur
if we choose to develop our land investment. We anticipate generating
approximately $2,000,000 in gross commissions, interest earned, and continuing
receipts from the sale of our clearing operation. The primary use of cash for
operations is an estimated $4,000,000 in professional fees, primarily legal
costs to defend us in various legal matters. If funds, which may be needed, are
raised through the issuance of additional equity securities, our existing
shareholders may experience additional dilution in ownership percentages or book
value. Additionally, such securities may have rights, preferences and privileges
senior to those of the holders of our current common stock. We cannot give any
assurance that additional funds will not be needed. If additional funds are
needed, there can be no assurance that additional financing will be available or
whether it will be available on terms satisfactory to us. If we are unable to
raise additional funds when needed, we may have to file for protection under
Chapter 11 of the United States Bankruptcy Code.



                                       17
<PAGE>

Going Concern
-------------

As previously noted, we have sold substantially all of our ongoing business
operations and do not have significant revenues from current operations. There
is significant doubt as to whether our limited remaining operations can generate
sufficient revenue to be a continuing viable going concern. Further, there is
significant uncertainty with respect to the outcome of the SEC lawsuit related
to the late trading allegedly conducted by us. As a result, the report of our
independent registered public accounting firm issued in connection with our
December 31, 2004 consolidated financial statements indicates there is
substantial doubt about our ability to continue as a going concern.

Should the outcome or judgment against us from the SEC lawsuit related to the
ongoing mutual fund investigations (as disclosed in Note 6, Contingent
Liabilities) be significant, the demand for payment resulting from such outcome
or judgment coupled with our deteriorating financial results will likely affect
our ability to meet our obligations as they become due in the normal course of
business. Should we be unable to meet our obligations as they become due, we
would be forced to file for protection under Chapter 11 of the United States
Bankruptcy Code (Chapter 11).

Liquidity at June 30, 2005
--------------------------

Our cash position increased during the first half of 2005 by $1,915,425 to
$7,185,502. This compares with a net decrease in cash and cash equivalents of
$3,931,354 in the first half of 2004. We do not anticipate making any payments
on notes payable in the principal amount of $2,889,375 (See "Litigation Related
to Oeri Notes" in Legal Proceedings in Part II, below).

Cash Flows from Operating Activities
------------------------------------

Net cash provided by operating activities (including discontinued operating
activities) was $9,518 for the first six months of 2005, compared to cash of
$3,632,075 being used in operations during the first six months of 2004. Our net
cash provided by or used in operating activities is impacted by changes in the
brokerage-related assets and liabilities of NCC.

During the first six months of 2005, the most significant source of cash was the
decrease in cash segregated under federal and other regulations of $3,132,172.
Additionally, clearing deposits decreased to provide cash of $440,421. These
sources of cash were offset by the decreases in accounts payable and accrued
liabilities of $573,843 and the net loss of $1,831,718 after adjustments to
reconcile net loss to cash used in operating activities.

Cash Flows Used In Investing Activities
---------------------------------------

The net cash provided by investing activities during the first half of 2005 was
$2,308,685 compared with cash used of $215,946 during the first half of 2004.
The most significant source of cash was cash received from the sale of operating
assets of $8,696,031. The primary use of cash was to acquire investment
securities (US Government Bonds) in the amount of $6,024,708. Additionally, we
acquired 112,300 share of our common stock (see Note 3, "Equity Transactions and
Stock Options") in the amount of $308,825. All of the cash used for investing
activities in the period ended June 30, 2004 was for capital expenditures. We
presently have no plans to open additional offices and no significant
commitments for capital expenditures. Therefore, our requirement for capital
resources is not material to the business as a whole.

                                       18
<PAGE>

Cash Flows from Financing Activities
------------------------------------

The net cash used in financing activities during the first six months of 2005
was $402,778 compared with cash used in financing activities of $83,333 in the
first six months of 2004. The cash used in both periods was for the repayment of
notes payable. The payment made in 2005 was to pay the note off in conjunction
with the acquisition of 112,300 of share of our common stock (see above and Note
6 "Contingent Liabilities" under "Litigation Related to Account Acquisitions").

RISK FACTORS

You should carefully consider the risks described below before making an
investment decision in our securities. The risks and uncertainties described
below are not the only ones we face and there may be additional risks that we do
not presently know of or that we currently deem immaterial. All of these risks
may impair our business operations. The forward-looking statements in this
report involve risks and uncertainties and actual results may differ materially
from the results we discuss in the forward-looking statements. If any of the
following risks actually occur, our business, financial condition or results of
operations could be materially adversely affected. In that case, the trading
price of our stock could decline, and you may lose all or part of your
investment.

WE HAVE SOLD SUBSTANTIALLY ALL OF OUR ONGOING OPERATIONS AND HAVE ADOPTED A NEW
BUSINESS PLAN.

In September 2004, we sold our correspondent clearing business to North American
Clearing, Inc. In October 2004, we sold our retail brokerage accounts to
Ameritrade, Inc. While these asset sales have provided us substantial working
capital, we have just announced our intention to enter into the real estate
investment and development business, and have yet to significantly begin work in
that area. Further, given that an entity controlled by our CEO and Chairman of
the Board owns over 57% of our outstanding stock, he alone can require the
Company to take certain actions by requesting a shareholder vote.

WE HAVE INCURRED OPERATING LOSSES IN THE PAST AND MAY INCUR FUTURE OPERATING
LOSSES.

While we did not incur a loss in 2004, this was as a result of the sale of
substantially all of our ongoing operations. We incurred a loss of $6.5 million
in 2004 on our continuing operations. Further, we incurred losses from
continuing operations of approximately $4.5 and $5.1 million for each of the
years ended December 31, 2003, and, 2002, respectively. If we continue to incur
losses and negative cash flow, we may need additional capital to fund working
capital and cash flow deficits. There can be no assurance that such capital will
be available to us, or if available, on terms that are not substantially
dilutive to existing shareholders. The unavailability of such capital could
require us to further curtail our operations in the future.

SUBSTANTIAL DOUBT EXISTS RELATING TO OUR ABILITY TO CONTINUE AS A GOING CONCERN.

As noted in this section, we have sold substantially all of our ongoing business
operations and do not have an ongoing business plan for future operations. There
is significant uncertainty as to whether our limited remaining operations can
generate sufficient revenue to be a continuing viable going concern. Further,
there is significant uncertainty with respect to the outcome of the SEC lawsuit

                                       19
<PAGE>

related to the late trading allegedly conducted by us. As a result, the report
of our independent registered public accounting firm indicates there is
substantial doubt about our ability to continue as a going concern.

                                       20
<PAGE>

SECURITIES LITIGATION COULD ADVERSELY AFFECT OUR BUSINESS.

We are a party to several lawsuits, most particularly that commenced by the SEC
related to market timing and late trading, discussed above, that in the
aggregate seek millions of dollars in damages and penalties. A substantial
settlement or award against us in these actions could have a material adverse
effect on our business.

In addition, our ongoing securities brokerage business involves substantial
risks of liability and corresponding litigation including class action and other
suits that generally seek substantial damages including punitive damages. Like
other securities brokerage firms, from time to time we are named as a defendant
in civil lawsuits and arbitrations. Any significant monetary judgments against
us in the course of litigation could have a material adverse effect on our
business, financial condition and operating results.

YOUR INTERESTS AS A STOCKHOLDER MAY CONFLICT WITH OUR CONTROLLING STOCKHOLDER,
OUR CHIEF EXECUTIVE OFFICER AND OUR PRESIDENT.

Our executive officers, directors and principal shareholders beneficially own
approximately 57% of our outstanding common stock. As a result, our controlling
shareholders have the power to control or direct our business affairs including
matters requiring stockholder approval. This concentration of ownership could
effectively delay, defer or prevent a change in control or other significant
corporate transactions that might give you the opportunity to realize a premium
over our then prevailing stock price. In addition, various conflicts of interest
may arise in the future as a result of our relationship with Third Capital
Partners, LLC, ("Third Capital Partners"), a company controlled by our Chief
Executive Officer who also serves on our Board of Directors. Serving us as an
officer and director as well as Third Capital Partners could result in our Chief
Executive Officer being placed in a conflict of interest should he have to make
decisions that have materially different implications for us and for Third
Capital Partners. An affiliate of Third Capital Partners receives management
fees from us, which could influence decisions.

OUR BUSINESS IS SUBJECT TO EXTENSIVE REGULATION UNDER BOTH FEDERAL AND STATE
LAWS.

The securities industry is subject to extensive regulation and broker-dealers
are subject to regulations covering all aspects of the securities business. The
SEC, NASD, and other self-regulatory organizations and state and foreign
regulators can, among other things, fine, issue cease-and-desist orders to,
suspend or expel a broker-dealer or any of its officers or employees.

Our ability to comply with applicable laws and rules is largely dependent on our
internal system to ensure compliance, as well as our ability to attract and
retain qualified compliance personnel. We could be subject to disciplinary or
other actions in the future due to claimed noncompliance, which could have a
material adverse effect on our operations and profitability.

THE TRADING PRICE OF OUR COMMON STOCK HAS BEEN AND MAY CONTINUE TO BE SUBJECT TO
WIDE FLUCTUATIONS.

During the past twelve months, our common stock traded as low as $1.20 and as
high as $4.24. Our stock price may fluctuate in response to a number of events
and factors, such as the nature and

                                       21
<PAGE>

timing of any new business alternatives or investments we determine to pursue,
our litigation, and factors bearing on our institutional trading and market
making operations. In addition, the stock market in general, and the market
prices for Internet related companies in particular, have experienced extreme
volatility that has often been unrelated to operating performance. These broad
market and industry fluctuations may adversely affect the price of our common
stock, regardless of our operating performance.

OUR STOCK PRICE COULD MATERIALLY DECLINE IF THIRD CAPITAL SELLS IT SHARES.

In September 2004, Third Capital Partners converted the notes then held by it
into approximately 2 million shares of our common stock. As a result of the
conversion, Third Capital Partners owns approximately 57% of our common stock.

If Third Capital Partners sells substantial amounts of our common stock into the
public market, it could cause a significant decrease in our stock price.
Furthermore, the awareness that a large number of shares is available for sale
under this registration statement could cause the price of our stock to fall or
could prevent the price from rising.

In addition to the adverse effect a price decline would have on our
shareholders, it could impede our ability to raise capital through the issuance
of securities or utilize our common stock for acquisitions. Furthermore,
regardless of any sale by Third Capital Partners, we have announced our intent,
subject to shareholder approval, to undertake a 1 for 100 share reverse stock
split, which will likely result in a delisting of our shares from the NASDAQ
SmallCap Market. The delisting of our shares could further harm our stock price
and make it more difficult for our shareholders to sell their shares.

THE LOSS OF CERTAIN KEY EXECUTIVE OFFICERS COULD HARM OUR BUSINESS.

Our success is substantially dependent upon the continuing services of certain
key executive officers, especially our Chief Executive Officer and our
President. We have entered into written employment agreements with the key
executive officers of our operating subsidiaries, which expire in June 2006.
However, we do not maintain "key person" life insurance on any of our executive
officers. There can be no assurance that any of our executive officers will
continue to work for us nor can there be any assurance that upon ceasing to work
for us they will not compete against us. The loss of our Chief Executive Officer
and President could have a material adverse effect on our business, financial
condition and results of operations.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market Risk Disclosures
-----------------------

The following discussion about our market risk disclosures involves
forward-looking statements. Actual results could differ materially from those
projected in the forward-looking statements. See "Special Note Regarding Risk
Factors" below. We are exposed to market risks related to changes in interest
rates and equity security price risk. We do not have derivative financial
instruments for speculative or trading purposes.

                                       22
<PAGE>

Areas outside our control that affect the securities market, such as severe
downturns or declines in market activity, may cause substantial financial
exposure.

Interest Rate Sensitivity and Financial Instruments
---------------------------------------------------

For our working capital and reserves that are required to be segregated under
federal or other regulations, we invest primarily in U.S. bank certificates of
deposit and savings accounts. The certificates of deposit have maturity dates
ranging from three to six months, and do not present a material interest rate
risk.

Equity Price Risk
-----------------

NCC acts as a market maker for approximately 10 public corporations whose stocks
are traded primarily through PinkSheets LLC. We select companies in which we
make a market based on a review of the current market activity, and also to
facilitate trading activity of our clients. Market making may result in a
concentration of securities that may expose us to additional risk; however, we
do not maintain a significant inventory of equity securities.

ITEM 4. CONTROLS AND PROCEDURES

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

We have adopted internal controls and procedures in order to ensure that the
information required to be disclosed in the report is recorded, processed,
summarized and reported on a timely basis. We carried out an evaluation (the
"Evaluation"), under the supervision and with the participation of our Chief
Executive Officer ("CEO") and Chief Financial Officer ("CFO"), of the
effectiveness of the design and operation of our disclosure controls and
procedures ("Disclosure Controls") as of the end of the period covered by this
report. Based on the Evaluation, our CEO and CFO concluded that our disclosure
controls and procedures were effective as of the end of the period covered by
this report.

CHANGES IN INTERNAL CONTROLS

Because of the reduction of personnel, there have been changes in internal
accounting controls regarding the proper segregation of duties. Because of the
lack of personnel, some duties have been combined, where segregation of such
duties would be more desirable.

CEO AND CFO CERTIFICATIONS

Appearing immediately following the Signatures section of this report are
Certifications of the CEO and the CFO. The Certifications are required in
accordance with Section 302 of the Sarbanes-Oxley Act of 2002 ("the Section 302
Certifications"). This Item of this report provides information concerning the
Evaluation referred to in the Section 302 Certifications, and this information
should be read in conjunction with the Section 302 Certifications for a more
complete understanding of the topics presented.

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<PAGE>

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

In addition to those matters described below, we are from time to time subject
to legal, arbitration or administrative proceedings arising in the ordinary
course of our business, including claims by former customers relating to
brokerage services, as well as matters related to our former clearing services.
We are also subject to periodic regulatory audits and inspections by the SEC and
NASD that could give rise to claims against us. While we make provision for a
liability when it is probable that a liability has been incurred and the amount
of the loss can be reasonably estimated, legal matters are inherently
unpredictable and expensive to defend. If there are adverse outcomes in our
legal proceedings, it could have a material adverse effect on our business and
financial condition. Those proceedings that management believes may have a
significant impact are described below. However, there can be no assurance that
in the future, other current or future proceedings will not have a material
adverse effect on our financial condition or results of operations. In
particular, if we were required to pay a judgment in excess of the amount
reserved, such a payment would negatively impact the financial condition of the
Company. We regularly assesses its potential liability in all pending litigation
to properly set the level of reserves for such litigation. To the extent that
the reserves are sufficient to cover all awards and settlements, no currently
threatened or pending litigation should materially impact the our financial
position, results of operations or cash flows. Our aggregate reserve for pending
litigation was $456,998 as of June 30, 2005

SEC MUTUAL FUND LAWSUIT

On or about August 24, 2004, the SEC's Los Angeles Office commenced a civil
lawsuit against the Company, NCC, and three of its former officers and
employees, alleging violations of Section 17(a) of the Securities Act of 1933,
Section 10(b) of the Exchange Act of 1934 and Rule 10b-5 thereunder, and Section
22(c) of the Investment Company Act of 1940 and Rule 22c-1 thereunder. In
January 2005, all claims under Section 17(a) of the Securities Act of 1933 were
dismissed by the Court, with prejudice. The remaining claims remain pending. The
suit seeks unspecified monetary damages and penalties, as well as other remedies
against the individual defendants. The suit contends that we wrongfully allowed
customers to place mutual fund trades after 4:00 p.m. EST, and wrongfully
assisted clients in "market timing" of mutual funds. While we admit no
wrongdoing and intend to vigorously defend ourselves, no assurance can be given
as to the outcome of this matter. Although the likelihood of loss is reasonably
possible, we have not accrued any specific amounts related to this matter, as no
amount of loss in the our estimated range of loss of zero to $20 million is more
likely than another.

LITIGATION RELATED TO OERI NOTES

We are a party to a lawsuit entitled EBC Trust v. JB Oxford Holdings, Inc., et
als., pending in the Federal District Court in Los Angeles. In this suit, EBC
Trust, as the assignee of certain notes described below issued by us is seeking
payment of the $2.9 million of such notes. We issued $2.9 million in demand
notes to former shareholders during 1997. The notes bore interest at 8 1/4%,
payable quarterly. In 1998, $250 thousand was paid on the demand notes. In 1999,
$728 thousand of the debt was forgiven by Oeri Financial, Inc. and Felix A. Oeri
(collectively "Oeri"), leaving a balance due of $1.9 million, which was
reclassified to notes payable in 1999. A $1.0 million

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subordinated loan agreement, payable to Oeri Finance, Inc., matured by its terms
on March 31, 1999. The balance due was reclassified to note payable at that
time.

Since in or about March 1999, we have refused to make payment under the notes
payable totaling approximately $2.9 million, plus interest, and has asserted
defenses and counterclaims against the alleged holders of the notes related to:
i) an award entered jointly against us and the holders related to alleged
wrongful conduct by our NCC subsidiary in clearing certain customer accounts
during the time that the holders of the notes payable ran the Company; and, ii)
we have acquired a Judgment against Oeri Finance, Inc., which we intends to use
as a set-off against claims on the notes payable. The amount of the Judgment
acquired is substantially in excess of the total claimed due on the notes
payable.

In July 2002, the court magistrate granted a pre-judgment attachment against our
assets in favor of EBC Trust. In January 2003, the Court reversed the
magistrate's order and dissolved the attachment. In January 2003, EBC Trust
amended its claim to assert additional claims against us and to add claims
against our officers and directors, as well as to add a claim against NCC under
the $1.0 million Oeri subordinated note. By Order dated October 14, 2003, in
response to motions filed by us, the Court dismissed several claims, struck
portions of the Amended Complaint, and compelled EBC Trust to arbitrate all
claims against NCC.

As to the remaining claims, we have asserted a number of defenses to EBC Trust's
claims, including fraud, and contribution related to a judgment entered against
EBC Trust's predecessor-in-interest under the notes payable and NCC in an NASD
arbitration commenced by Stanley J. Cohen, Receiver for Secured Equity Title and
Appraisal Agency Corp. While normally a clearing case, the panel ruling relied
primarily on testimony regarding the activities of Irving Kott while present at
the Company. Mr. Kott is alleged to have provided most of the funds for the
loans now being pursued by EBC Trust. NCC settled all of the claims against it
in that matter in 2002, and as a part of that settlement, obtained the
assignment from Secured Equity of a Judgment against Oeri Finance, Inc.
Accordingly, we have asserted a claim of offset for the Judgment against Oeri
Finance, Inc. We recorded liabilities of approximately $2.9 million on our
balance sheet in notes payable, additionally, we have $816 thousand of accrued
interest related to these notes included in accounts payable and accrued
expenses. We have not yet recorded the offset of the judgment obtained in our
financial statements as the claim has not yet been adjudicated.

In December 2003, EBC Trust commenced an arbitration action with the National
Association of Securities Dealers, Inc., against JBOC, seeking recovery on the
$1.0 million subordinated note originally issued to RMS Network, Inc., and
subsequently assigned with approval from our NCC subsidiary and the NASD to Oeri
Finance, Inc. We intend to vigorously defend the action and believe that we have
meritorious defenses including, without limitation: i) the suit is brought
against the wrong party; ii) no valid assignment has ever been approved by us or
the NASD to EBC Trust, as required by the terms of the note; and iii) we will
assert an offset for the Judgment obtained against Oeri Finance, Inc., described
above.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

      During March 2005 the Company repurchased 112,300 shares of its common
stock at an effective price of $2.89 per share. The retirement of the stock was
recorded at a cost of $2.75

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<PAGE>

per share representing the fair marker value on the
day the shares were acquired and $16,175 was accrued as an expense at December
31, 2004. The 112,300 shares of treasury stock was retired in March 2005.

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

        Exhibits

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

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

32.1    Certification of Christopher L. Jarratt, Chief Executive Officer,
        pursuant to 18 U.S.C. ss. 1350.

32.2    Certification of Michael J. Chiodo, Chief Financial Officer, pursuant to
        18 U.S.C. ss. 1350.

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<PAGE>

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

JB Oxford Holdings, Inc.

/s/ Michael J. Chiodo
-----------------------
Michael J. Chiodo
Chief Financial Officer

August 15, 2005

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