SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549



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Form 10-Q

QUARTERLY REPORT UNDER SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934



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For the Quarterly Period Ended: September 30, 2003



Commission File No.  0-5703



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Siebert Financial Corp.

(Exact name of registrant as specified in its charter)



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|New York                                                             |  | **11-1796714**                            
|-------------------------------------------------------------------- |  | ------------------------------------------
|(State or other jurisdiction of
      incorporation or organization) |  | (I.R.S. Employer
      Identification No.)



**885 Third Avenue, New York, NY                
  10022**

(Address
  of principal executive offices)                      
  (Zip Code)



(212) 644-2400

(Registrant's telephone number, including area code)



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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the
  Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and
  (2) has been subject to such filing requirements for the past 90 days.



Yes x No ̈



Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the exchange Act).



Yes ̈No x



State the number of shares outstanding of each of the issuers classes of common
  equity, as of the latest practicable date: As of November 5, 2003, there were 22,257,200 shares of Common Stock, par value $.01 per share, outstanding.







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Unless the context otherwise requires, the Company shall mean Siebert Financial Corp. and its wholly owned subsidiaries and Siebert shall mean Muriel Siebert & Co., Inc., a wholly owned subsidiary of the Company.

Certain statements contained in the Managements Discussion and Analysis of Financial Condition and Results of Operations below and elsewhere in this document, as well as oral statements that may be made by the Company or by its officers, directors or employees acting on the Companys behalf, that are not statements of historical or current fact constitute forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  Such forward looking statements involve risks and uncertainties and known and unknown factors that could cause the actual results of the Company to be materially different from the historical results or from any future results expressed or implied by such forward looking statements, including, without limitation: changes in general economic and market conditions; fluctuations in volume and prices of securities; demand for brokerage and investment banking services; competition within and without the discount brokerage business, including the offer of broader services; competition from electronic discount brokerage firms offering lower rates on commissions than the Company; the prevalence of a flat fee environment; decline in participation in equity or municipal finance underwritings; limited trading opportunities; the method of placing trades by the Companys customers; computer and telephone system failures; the level of spending by the Company on advertising and promotions; trading errors and the possibility of losses from customer non-payment of amounts due; other increases in expenses and changes in net capital or other regulatory requirements.  The Company undertakes no obligation to publicly release the results of any revisions to these forward-looking statements which may be made to reflect events or circumstances after the date when such statements were made or to reflect the occurrence of unanticipated events.  An investment in the Company involves various risks, including those mentioned above and those which are detailed from time to time in the Companys Securities and Exchange Commission filings.

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Siebert Financial Corp.

S.E.C. FORM 10-Q



September 30, 2003





INDEX



|PART I.    | FINANCIAL
      INFORMATION                                                                                                                                      | PAGE NO.
|---------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------
|           | Item 1. Financial Statements                                                                                                                                     |         
|           | Consolidated
      Statements of Financial Condition 
      September 30, 2003 (unaudited) and December 31, 2002 (audited)                                       | 4       
|           | Consolidated
      Statements of Operations (unaudited)
      Three months ended September 30, 2003 and 2002
      Nine months ended September 30, 2003 and 2002 | 5       
|           | Consolidated
      Statements of Cash Flows (unaudited)
      Nine months ended September 30, 2003 and 2002                                                      | 6       
|           | Notes to Financial Statements                                                                                                                                    | 7-9     
|           | Item 2. Management's Discussion and Analysis of
      Financial Condition and Results of Operations                                                              | 10      
|           | Item 3. Quantitative and Qualitative Disclosures
      About Market Risk                                                                                         | 14      
|           | Item 4. Controls and Procedures                                                                                                                                  | 15      
|PART II.   | OTHER INFORMATION                                                                                                                                                | 15      
|           | Item 1. Legal Proceedings                                                                                                                                        | 15      
|           | Item 2. Changes in Securities and Use of Proceeds                                                                                                                | 15      
|           | Item 3. Defaults Upon Senior Securities                                                                                                                          | 15      
|           | Item 4. Submission of Matters to
      Vote to Security Holders                                                                                                  | 15      
|           | Item 5. Other Information                                                                                                                                        | 15      
|           | Item 6. Exhibits and Reports
      on Form 8-K                                                                                                                   | 15      
|           |                                                                                                                                                                  |         
|SIGNATURES |                                                                                                                                                                  | 16      





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##### Table of Contents

Part I - FINANCIAL INFORMATION

Item 1.

Financial Statements.

|Siebert Financial
        Corp. & Subsidiaries
        Consolidated Statements of Financial Condition
|-----------------------------------------------------------------------------------------------------



|                                                                                                                                                                                                                 |  |  | September 30,
        2003
      (Unaudited) |                           | December 31,2002 | 
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  | -------------------------------------------- | ------------------------- | ---------------- | 
|                                                                                                                                                                                                                 |  |  |                                              |                           |                 
|                                                                                                                                                                                                                 |  |  |                                              |                          
|ASSETS                                                                                                                                                                                                           |  |  |                                              |                           |                  | 
|Cash
        and cash equivalents                                                                                                                                                                                |  |  | $                                            | 21,746,000                |                  | 
|Cash
        equivalents  restricted                                                                                                                                                                            |  |  |                                              | 1,300,000                 |                  | 
|Receivable
        from clearing brokers                                                                                                                                                                         |  |  |                                              | 1,610,000                 |                  | 
|Advance
        to clearing broker                                                                                                                                                                               |  |  |                                              | 1,500,000                 |                  | 
|Securities
        owned, at market value                                                                                                                                                                        |  |  |                                              | 3,924,000                 |                  | 
|Furniture,
        equipment and leasehold improvements, net                                                                                                                                                     |  |  |                                              | 2,048,000                 |                  | 
|Investment
        in and advances to equity investee                                                                                                                                                            |  |  |                                              | 3,049,000                 |                  | 
|Intangibles,
        net                                                                                                                                                                                         |  |  |                                              | 2,563,000                 |                  | 
|Prepaid
        expenses and other assets
      Deferred tax asset                                                                                                                                               |  |  |                                              | 1,531,000
        880,000 |                  | 
|                                                                                                                                                                                                                 |  |  | $                                            | 40,151,000                |                  | 
|                                                                                                                                                                                                                 |  |  |                                              |                           |                  | 
|                                                                                                                                                                                                                 |  |  |                                              |                           |                  | 
|LIABILITIES
        AND STOCKHOLDERS EQUITY                                                                                                                                                                     |  |  |                                              |                           |                  | 
|Accounts
        payable and accrued liabilities                                                                                                                                                                 |  |  |                                              | 4,950,000                 |                  | 
|                                                                                                                                                                                                                 |  |  |                                              | 4,950,000                 |                  | 
|                                                                                                                                                                                                                 |  |  |                                              |                           |                  | 
|Commitments
        and contingent liabilities                                                                                                                                                                   |  |  |                                              |                           |                  | 
|                                                                                                                                                                                                                 |  |  |                                              |                           |                  | 
|Stockholders
        equity:                                                                                                                                                                                    |  |  |                                              |                           |                  | 
|Common
        stock, $.01 par value; 49,000,000 shares authorized,    
           22,983,917 shares issued and 22,262,114 shares outstanding 
           at September 30, 2003 and 22,968,167 shares issued and |  |  |                                              |                           |                  | 
|22,395,767 shares outstanding at December 31, 2002                                                                                                                                                               |  |  |                                              | 229,000                   |                  | 
|Additional
        paid-in capital                                                                                                                                                                               |  |  |                                              | 17,916,000                |                  | 
|Retained
        earnings                                                                                                                                                                                        |  |  |                                              | 20,444,000                |                  | 
|Less: 721,803 and 572,400 shares of treasury stock, at cost                                                                                                                                                      |  |  |                                              |                           |                  | 
|at September 30, 2003 and December 31, 2002, respectively                                                                                                                                                        |  |  |                                              | (3,388,000                | )                | 
|                                                                                                                                                                                                                 |  |  |                                              | 35,201,000                |                  | 
|                                                                                                                                                                                                                 |  |  |                                              |                           |                  | 
|                                                                                                                                                                                                                 |  |  | $                                            | 40,151,000                |                  | 
|                                                                                                                                                                                                                 |  |  |                                              |                           |                  | 











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##### Table of Contents



Siebert Financial Corp. & Subsidiaries

Consolidated Statements of Operations

(Unaudited)

|                                                                       | Three Months Ended | Nine
Months Ended
|---------------------------------------------------------------------- | ------------------ | -----------------
|                                                                       | September
30,      | September
30,    
|                                                                       | 2003               | 2002             
|                                                                       |                    |                  
|Revenues:                                                              |                    |                  
|Commissions and
fees                                                   | $5,256,000         | $4,671,000       
|Investment banking                                                     | 213,000            | 408,000          
|Trading profits                                                        | 213,000            | 92,000           
|Income from equity
investee                                            | 241,000            | 397,000          
|Interest and dividends                                                 | 85,000             | 129,000          
|                                                                       | 6,008,000          | 5,697,000        
|                                                                       |                    |                  
|Expenses:                                                              |                    |                  
|Employee compensation
and benefits                                     | 2,025,000          | 2,193,000        
|Clearing fees,
including floor brokerage                               | 1,057,000          | 954,000          
|Advertising and
promotion                                              | 300,000            | 915,000          
|Communications                                                         | 605,000            | 568,000          
|Occupancy                                                              | 277,000            | 223,000          
|Interest                                                               | —                  | —                
|Other general and
administrative                                       | 1,569,000          | 2,053,000        
|                                                                       | 5,833,000          | 6,906,000        
|                                                                       |                    |                  
|Income (loss) before income taxes                                      | 175,000            | (1,209,000)      
|                                                                       |                    |                  
|Provision (benefit) for income taxes                                   | 60,000             | (483,000)        
|Net income (loss)                                                      | $    115,000       | $ (726,000)      
|                                                                       |                    |                  
|Net income (loss) per share of common
stock -
       Basic and Diluted | $           
..01  | $        
(.03)  
|Weighted average shares outstanding
-                                  |                    |                  
|Basic                                                                  | 22,258,686         | 22,415,907       
|Weighted average shares outstanding
-                                  |                    |                  
|Diluted                                                                | 22,484,506         | 22,415,907       
|                                                                       |                    |                  
|                                                                       |                    |                  
|                                                                       |                    |                  



See notes to consolidated financial statements.





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##### Table of Contents





|Siebert
        Financial Corp. & Subsidiaries
      Consolidated Statements of Cash Flows
      (Unaudited) | 
|------------------------------------------------------------------------------------------------------------ | 





|                                                                                                                |   | Nine Months Ended |  
|--------------------------------------------------------------------------------------------------------------- | - | ----------------- | -
|                                                                                                                |   | September 30,     |  
|                                                                                                                |   | 2003              |  
|Cash flows from operating activities:                                                                           |   |                   |  
|Net
        income (loss)                                                                                       | $ | 67,000            |  
|Adjustments
        to reconcile net income (loss) 
        to net cash used in operating activities:           |   |                   |  
|Depreciation
        and amortization                                                                           |   | 1,314,000         |  
|Income
        from equity investee                                                                             |   | (1,704,000        | )
|Changes
        in operating assets and liabilities:                                                            |   |                   |  
|Net
        decrease in securities owned, at market value                                                       |   | 1,301,000         |  
|Net
        increase in receivable from clearing brokers                                                        |   | (510,000          | )
|Decrease
        (increase) in prepaid expenses and other assets                                                |   | 285,000           |  
|Net
        decrease in securities sold, not yet 
        purchased, at market value                            |   |                   |  
|Net
        Change in deferred taxes                                                                            |   | (34,000           | )
|Increase
        in accounts payable and accrued liabilities                                                    |   | 166,000           |  
|Net
        cash provided by (used in) operating activities                                                     |   | 885,000           |  
|                                                                                                                |   |                   |  
|                                                                                                                |   |                   |  
|                                                                                                                |   |                   |  
|Cash
        flows from investing activities:
      Purchase of furniture, equipment and leasehold improvements |   | (148,000          | )
|Return
        of deposit on equipment                                                                          |   | 241,000           |  
|Advance
        to clearing broker                                                                              |   | (1,500,000        | )
|Purchase
        of customer accounts                                                                           |   | (1,100,000        | )
|Net
        (advances) collections of advances - equity investee                                                |   | (40,000           | )
|Distribution
        from equity investee                                                                       |   | 1,443,000         |  
|Net
        cash used in investing activities                                                                   |   | (1,104,000        | )
|                                                                                                                |   |                   |  
|Cash
        flows from financing activities:                                                                   |   |                   |  
|Proceeds
        from exercise of options                                                                       |   | 36,000            |  
|Repurchase
        of common stock                                                                              |   | (569,000          | )
|Net
        cash (used in) provided by financing activities                                                     |   | (533,000          | )
|Net
        decrease in cash and cash equivalents                                                               |   | (752,000          | )
|Cash
        and cash equivalents - beginning of period                                                         |   | 22,498,000        |  
|                                                                                                                |   |                   |  
|Cash
        and cash equivalents - end of period                                                               | $ | 21,746,000        |  
|                                                                                                                |   |                   |  
|                                                                                                                |   |                   |  
|Supplemental
        cash flow disclosures:                                                                     |   |                   |  
|Cash
        paid for:                                                                                          |   |                   |  
|Interest                                                                                                        | $ | 1,000             |  
|Income
        taxes                                                                                            | $ | 61,000            |  







See notes to consolidated financial statements.





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##### Table of Contents





Siebert Financial Corp. & Subsidiaries

Notes to Consolidated Financial Statements

Nine Months Ended September 30, 2003 and 2002

(Unaudited)






1.

Organization and Basis of Presentation:

The consolidated financial statements include the accounts of Siebert Financial Corp. (the Company) and its wholly owned subsidiaries Muriel Siebert & Co., Inc. (Siebert) and Siebert Womens Financial Network, Inc. (WFN). All material intercompany balances have been eliminated. The statements are unaudited; however, in the opinion of management, all adjustments considered necessary to reflect fairly the Companys financial position and results of operations, consisting of normal recurring adjustments, have been included.

The accompanying consolidated financial statements do not include all of the information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles. Accordingly, the statements should be read in conjunction with the audited financial statements included in the Companys Annual Report on Form 10-K for the year ended December 31, 2002. Because of the nature of the Companys business, the results of any interim period are not necessarily indicative of results for a full year.

2.

Stock-Based Compensation

Statement of Financial Accounting Standards ("SFAS") No. 123, Accounting for Stock-Based Compensation ("SFAS 123") as amended by SFAS No. 148, (Accounting for Stock-Based Compensation  Transition and Disclosure an amendment to SFAS 123), allows the fair value of stock-based compensation to be included in expense over the period earned; alternatively, if the fair value of stock-based compensation awards are not included in expense, SFAS 123 requires disclosure of net income (loss), on a pro forma basis, as if expense treatment had been applied. As permitted by SFAS 123, the Company continues to account for such compensation under Accounting Principles Board Opinion No. 25 ("APB 25"), Accounting for Stock Issued to Employees, and related interpretations, pursuant to which no compensation cost was recognized in connection with the issuance of stock options, as all options granted under the 1997 Stock Option Plan had an exercise price equal to or greater than the fair value of the underlying common stock on the date of grant. Had the Company elected to recognize compensation expense for the stock option plan, consistent with the method prescribed by SFAS 123, the Company's net income (loss) and net income (loss) per share for the three months and nine months ended September 30, 2003 and 2002 would have (decreased) increased the pro forma amounts as follows:







|                                                     | Three Months        |          | Nine Months         |  |      |             |      |  
|---------------------------------------------------- | ------------------- | -------- | ------------------- |  | ---- | ----------- | ---- | -
|                                                     | Ended September 30, |          | Ended September 30, |  |      |             |      |  
|                                                     | 2003                |          |                     |  | 2002 |             | 2003 |  
|                                                     |                     |          |                     |  |      |             |      |  
|                                                     |                     |          |                     |  |      |             |      |  
|Net income (loss), as reported                       | $                   | 115,000) |                     |  | $    | (726,000)   |      | $
|Stock-based employee compensation determined         |                     |          |                     |  |      |             |      |  
|under APB 25                                         |                     | —        |                     |  |      | —           |      |  
|Stock-based employee compensation determined         |                     |          |                     |  |      |             |      |  
|under the fair value based method, net of tax effect |                     | (74,000) |                     |  |      | (593,000)   |      |  
|                                                     |                     |          |                     |  |      |             |      |  
|                                                     |                     |          |                     |  |      |             |      |  
|Pro forma net income (loss)                          | $                   | 41,000   |                     |  | $    | (1,319,000) |      | $
|                                                     |                     |          |                     |  |      |             |      |  
|                                                     |                     |          |                     |  |      |             |      |  
|Net income (loss) per share - basic:                 |                     |          |                     |  |      |             |      |  
|                                                     |                     |          |                     |  |      |             |      |  
|As reported                                          | $                   | .01      |                     |  | $    | (.03)       |      | $





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##### Table of Contents



|Pro forma                              | $ | —   |  |  | $ |  | (.06 | ) |  | $ |  | (.03 | ) |  | $ |  | (.11 | )
|-------------------------------------- | - | --- |  |  | - |  | ---- | - |  | - |  | ---- | - |  | - |  | ---- | -
|                                       |   |     |  |  |   |  |      |   |  |   |  |      |   |  |   |  |      |  
|Net income (loss) per share - diluted: |   |     |  |  |   |  |      |   |  |   |  |      |   |  |   |  |      |  
|                                       |   |     |  |  |   |  |      |   |  |   |  |      |   |  |   |  |      |  
|As reported                            | $ | .01 |  |  | $ |  | (.03 | ) |  | $ |  | —    |   |  | $ |  | (.06 | )
|Pro forma                              | $ | —   |  |  | $ |  | (.06 | ) |  | $ |  | (.03 | ) |  | $ |  | (.11 | )



3.

Net Capital:

Siebert is subject to the Securities and Exchange Commissions Uniform Net Capital Rule (Rule 15c3-1), which requires the maintenance of minimum net capital.  Siebert has elected to use the alternative method, permitted by the rule, which requires that Siebert maintain minimum net capital, as defined, equal to the greater of $250,000 or two percent of aggregate debit balances arising from customer transactions, as defined.  (The net capital rule of the New York Stock Exchange also provides that equity capital may not be withdrawn or cash dividends paid if resulting net capital would be less than five percent of aggregate debits.)  As of September 30, 2003, Siebert had net capital of approximately $15,508,000 as compared with net capital requirements of $250,000.

4.

Capital Transactions:

On May 15, 2000, the board of directors of the Company authorized a stock buy back program of up to one million common shares. Shares will be purchased from time to time in the open market and in private transactions. Through September 30, 2003, 721,803 shares have been purchased at an average price of $4.69 per share.

5.

Option Grants:

During the nine months ended September 30, 2003, the Companys Board of Directors granted options to employees of the Company to purchase an aggregate of 50,000 shares of the Companys common stock at exercise prices ranging from $2.68 to $5.06 per share, in each case, the fair market value on the dates of grant.  The employee options granted during the period vest 20% per year for five years and expire ten years from the date of grant.

6.

Strategic Alliance Agreement

The
  Joint Brokerage Service (JBS) for customers of Quicken and Quicken.com,
  inaugurated in 2002 under the Strategic Alliance Agreement (Agreement)
  between Siebert and Intuit Inc. (Intuit), has produced results substantially
  below expectations. Revenues during the nine months ended September 30, 2003
  were nominal. New accounts added since inauguration of the JBS, through the
  third quarter of 2003, were far below projections. Based on (a) reports from
  Intuit of costs it incurred, (b) the costs incurred by Siebert and (c) an equal
  sharing of costs, the charges to the operations of Siebert relating to the JBS
  during the three and nine months ended September 30, 2003 were approximately
  $386,000 and $1.6 million, respectively, which include technology, marketing
  and content expenses of approximately $196,000 and $942,000 for the three and
  nine months ended September 30, 2003, respectively, and certain brokerage and
  other services expenses of $190,000 and $604,000 for the three and nine months
  ended September 30, 2003.  Accounts payable and accrued liabilities include
  net amounts claimed by Intuit of $1.7 million and $1.2 million at September
  30, 2003 and December 31, 2002, respectively.   The amounts charged to
  operations and included in accounts payable and accrued liabilities relating
  to the JBS are disputed by Siebert.  No new accounts are being accepted
  for the JBS and it is expected that the JBS will be terminated during December
  2003. Siebert filed a lawsuit against Intuit in New York State Supreme Court
  on September 17, 2003, alleging, among other things, breach of contractual obligations;
  breach of fiduciary duties; misrepresentation and/or fraud and containing other
  claims relating to the JBS. Siebert is seeking not less than $11.1 million in
  compensatory damages and $33.3 million in punitive damages. The lawsuit has
  been stayed pending a decision on a motion by Intuit to require that the dispute
  be submitted to arbitration. As a result, Intuit has not yet been required to
  respond to the lawsuit.





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##### Table of Contents

7.

Account Purchases:

In January 2003 Siebert acquired certain retail discount brokerage accounts from Your Discount Broker, Inc (YDB) for $1.1 million. These accounts were transferred to Siebert in March 2003. The purchase price for the customer accounts is included in Intangibles and is being amortized over a five-year period.

8.

Siebert Brandford Shank & Co., LLC:

Summarized financial data of Siebert Brandford Shank & Co., LLC,  (SBS) as of and for the nine months ended September 30, 2003 and 2002 is set forth below. Siebert holds a 49% ownership interest in SBS.



|                                                                            | 2003         | 2002      
|--------------------------------------------------------------------------- | ------------ | ----------
|                                                                            |              |           
|Total
        assets                                                        | $
9,897,000  | $8,766,000
|Total
        liabilities, including subordinated liabilities of $1,200,000 | $
3,828,000  | $4,754,000
|Total
        members capital                                              | $
6,069,000  | $4,012,000
|Total
        revenues                                                      | $11,632,000  | $8,850,000
|Net
        income                                                          | $ 
3,478,000 | $2,087,000





Siebert charged SBS $180,000
  for the nine months ended September 30, 2003 for rent and general and administrative services, which Siebert believes approximates the cost of furnishing
  such services.

Sieberts share of
  undistributed earnings from SBS amounted to $2,582,000 and $1,573,000 at September 30, 2003 and 2002, respectively. Such amounts may not be immediately
  available for distribution to Siebert for various reasons including the amount of SBSs available cash, the provisions of the agreement between Siebert
  and the principals and SBSs continued compliance with its regulatory and net capital requirements.

9.

Commitments and Contingent Liabilities:

Pursuant
  to the fully disclosed clearing agreement (the Clearing Agreement)
  with Pershing LLC (formerly the Pershing division of Donaldson, Lufkin &
  Jenrette Securities Corporation), (Pershing), Siebert advanced to
  Pershing $1,500,000 in January 2003, principally for software customization
  setup of the JBS.   Siebert has terminated the Clearing Agreement
  under circumstances which Siebert believes require the return of the advance
  by Pershing, and may require damages payable by Pershing arising from Pershings
  failure to perform its contractual obligations. Pershing has expressed its belief
  that it is entitled to retain the advance and to receive a minimum of an additional
  $3 million for unreimbursed costs and as a termination fee and $5 million for
  lost revenues. Siebert believes the Pershing claims are without merit. As a
  result of the termination of the Pershing contract, those accounts cleared by
  Siebert through Pershing, other than the accounts of the JBS, are now cleared
  through National Financial Services, LLC, (NFS) and the JBS accounts
  are expected to be converted to NFS during December 2003.

The Agreement with Intuit provides for Incremental Expenses of the JBS to be shared equally between Siebert and Intuit. Siebert believes that the advance to Pershing, net of any rebate of the advance, should be treated as an Incremental Expense. Siebert also believes that the $866,000 cost of a Customer Relationship Management System also should be treated as an Incremental Expense. Intuit has indicated that it does not agree with Siebert on these items.  Other charges of $485,000 relating to construction of the JBS website and related items have been incurred. As a result of these and other open issues with Intuit, Siebert filed a lawsuit against Intuit on September 17, 2003. See footnote 6.





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##### Table of Contents

The Company is involved in various routine lawsuits of a nature deemed by the Company customary and incidental to its business.  In the opinion of management, the ultimate disposition of such actions will not have a material adverse effect on its financial position or results of operations.

Item
  2.

Managements Discussion and Analysis of Financial Condition and Results of Operations

This discussion should be read in conjunction with the Companys audited and the unaudited Consolidated Financial Statements and the Notes thereto contained elsewhere in this Quarterly Report.

Business Environment

The market has continued
  to show strength in the third quarter of 2003 due to a low interest rate environment and increased business and consumer spending and the resulting increased
  interest in buying stocks. Commissions and customer trading activity had dropped in the first quarter of 2003. Competition in the brokerage industry remains
  intense and consolidation continues.

The Company, like other securities firms, is directly affected by general economic and market conditions including fluctuations in volume and prices of securities, changes and prospects for changes in interest rates and demand for brokerage and investment banking services, all of which can affect the Companys relative profitability.  In periods of reduced market activity, profitability is likely to be adversely affected because certain expenses, including salaries and related costs, portions of communications costs and occupancy expenses remain relatively fixed.  Earnings, or loss, for any period should not be considered representative of any other period.

Recent Developments

In January 2003 Siebert acquired
  certain retail discount brokerage accounts from Your Discount Broker, Inc (YDB) for $1.1 million. These accounts were transferred to Siebert
  in March 2003. The purchase price for the customer accounts is included in Intangibles and is being amortized over a five-year period. Siebert
  plans to consolidate YDBs Boca Raton office with Sieberts current Boca Raton office space during the first quarter of 2004. Siebert has consolidated
  YDB's Aventura office with Siebert's Surfside office in the third quarter of 2003.

The
  JBS for customers of Quicken and Quicken.com, inaugurated in 2002 under the
   Agreement between Siebert and Intuit, has produced results substantially
  below expectations. Revenues during the nine months ended September 30, 2003
  were nominal. New accounts added since inauguration of the joint brokerage service,
  through the third quarter of 2003, were far below projections. Based on (a)
  reports from Intuit of costs it incurred, (b) the costs incurred by Siebert
  and (c) an equal sharing of costs, the charges to the operations of the Company
  relating to the JBS during the three and nine months ended September 30, 2003
  were approximately $386,000 and $1.6 million, respectively, which includes technology,
  marketing and content expenses of approximately $196,000 and $942,000 for the
  three and nine months ended September 30, 2003, respectively, and certain brokerage
  and other services expenses of $190,000 and $604,000 for the three and nine
  months ended September 30, 2003, respectively.  Accounts payable and accrued
  liabilities include net amounts claimed by Intuit of $1.7 million and $1.2 million
  at September 30, 2003 and December 31, 2002, respectively. The amounts charged
  to operations and included in accounts payable and accrued liabilities relating
  to the JBS are disputed by Siebert.  No new accounts are being accepted
  for the JBS and it is expected that the JBS will be terminated during December
  2003. Siebert filed a lawsuit against Intuit in New York State Supreme Court
  on September 17, 2003, alleging, among other things, breach of contractual obligations;
  breach of fiduciary duties; misrepresentation and/or fraud and containing other
  claims relating to the JBS. Siebert is seeking not less than $11.1 million in
  compensatory damages and $33.3 million in punitive damages. The lawsuit has
  been stayed pending a decision on a motion by Intuit to require that the dispute
  be submitted to arbitration. As a result, Intuit has not yet been required to
  respond to the lawsuit.

Pursuant
  to the fully disclosed clearing agreement (the Clearing Agreement) with Pershing LLC (formerly the Pershing division of Donaldson, Lufkin
  & Jenrette Securities Corporation), (Pershing), Siebert advanced to Pershing $1,500,000 in January 2003, principally for software customization
  setup of the JBS. Siebert has terminated the Clearing Agreement under circumstances which Siebert believes require the return of the advance by Pershing,
  and may require damages payable by Pershing arising from Pershings failure to perform its contractual obligations. Pershing has expressed its belief
  that it is entitled to retain the advance and receive a minimum of an additional $3 million for unreimbursed costs and as a termination fee and $5 million
  for lost revenues. Siebert believes the Pershing claims are without merit. As a result of termination of the Pershing contract, those accounts cleared
  by Siebert through Pershing, other than the accounts of the JBS, are now cleared through NFS and the JBS accounts are expected to be converted to NFS
  during December 2003.  Additionally, Siebert anticipates saving approximately $50,000 per month from operations upon the consolidation into one clearing
  firm.

The
  Agreement with Intuit provides for Incremental Expenses of the JBS
  to be shared equally between Siebert and Intuit. Siebert believes that the advance
  to Pershing, net of any rebate of the advance, should be treated as an Incremental
  Expense. Siebert also believes that the $866,000 cost of a Customer Relationship
  Management System also should be treated as an Incremental Expense. Intuit has
  indicated that it does not agree with Siebert on those items.  Other incremental
  charges of $485,000 relating to construction of the JBS Web site and related
  items have been incurred.  As a result of these and other open issues with
  Intuit, Siebert filed a lawsuit against Intuit on September 17, 2003, as described
  above under Recent Developments.





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On May 15, 2000, the board of directors of the Company authorized the repurchase of up to 1,000,000 shares of the Companys common stock.  Shares will be purchased from time to time, in the discretion of the Company, in the open market and in private transactions.  Through September 30, 2003, 721,803 shares have been purchased at an average price of $4.69 per share.  The Company intends to continue acquiring shares pursuant to its stock repurchase program based upon the price of the stock and in accordance with applicable rules and regulations.

Critical Accounting Policies

The Company follows accounting policies standard in the brokerage industry and believes that its policies appropriately reflect its financial position and results of operations. Management has identified the use of Estimates as its critical accounting policy. These estimates relate primarily to revenue and expense items in the normal course of business as to which the Company receives no confirmations, invoices, or other documentation at the time the books are closed for a period. The Company uses its best judgment, based on its knowledge of these revenue transactions and expenses incurred, to estimate the amounts of such revenue and expense. The Company is not aware of any material differences between the estimates used in closing its books for the last five years and the actual amounts of revenue received and expenses incurred when the Company subsequently receives the actual confirmations, invoices or other documentation.  Estimates are also used in determining the useful lives of tangible and intangible assets, and the fair market value of intangible assets. Management believes that its estimates are reasonable.

Results of Operations

The Company believes that its business is performing relatively well, given the current difficult business environment for discount and online brokers. The Company had net income of $115,000 for the three months ended September 30, 2003 and net income of $67,000 for the nine months ended September 30, 2003. Included in the statement of operations for the nine months ended are direct expenses of approximately $1,546,000 and the nominal revenues attributable to the JBS.

The Company has implemented various cost reduction programs such as reducing head count and related employee expenses, reducing market data costs and renegotiating of vendor contracts. The Company continues to evaluate acquisition opportunities aimed at increasing profitability and enhancing economies of scale within the Companys existing infrastructure.

Three Months Ended September 30, 2003 Compared to Three Months Ended September 30, 2002

Total revenues for the three
  months ended September 30, 2003 were $6.0 million, an increase of $311,000 or 5.5% from the same period in 2002.

Commission and fee income for the three months ended September 30, 2003 was $5.3 million, an increase of $585,000 or 12.5% from the same period in 2002 due to higher trading volume as result of the strengthening market conditions during the third quarter of 2003.

Investment banking revenues
  for the three months ended September 30, 2003 were $213,000, a decrease of $195,000 or 47.8% from the same period in 2002 due to less activity in the
  new issue market.







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Income from the Companys
  equity investment in Siebert Brandford Shank & Co., LLC, an entity in which the Company holds a 49% equity interest (SBS), for the three
  months ended September 30, 2003 was $241,000 compared to income of $397,000, a decrease of $156,000 or 39.3% from the same period in 2002. This decrease
  was due to decreased activity in the municipal bond market.  SBS serves as an underwriter for municipal bond offerings.

Trading profits were $213,000 for the three months ended September 30, 2003, an increase of $121,000 or 131.5% over the same period in 2002 due to an overall increase in trading margins.

Interest and dividends for the three months ended September 30, 2003 were $85,000, a decrease of $44,000 or 34.1% from the same period in 2002 primarily due to slightly lower cash balances available for temporary investment coupled with lower interest rates.

Total expenses for the three months ended September 30, 2003 were $5.8 million, a decrease of $1.1 million or 15.5% from the same period in 2002.

Employee compensation and benefit costs for the three months ended September 30, 2003 were $2.0 million, a decrease of $168,000 or 7.7% from the same period in 2002. This decrease was primarily due to a reduction in the number of employees to reflect trading volumes lower than experienced in past years and a decrease in commission payouts, offset in part by an increase in employee expenses of $41,000 due to the Companys participation in the JBS with Intuit.

Clearing and floor brokerage costs for the three months ended September 30, 2003 were $1.1 million, an increase of $103,000 or 10.8% from the same period in 2002 primarily due to increased volume of trade executions, offset in part by an increase in clearing costs of $24,000 due to the Companys participation in the JBS.

Advertising and promotion expenses for the three months ended September 30, 2003 were $300,000, a decrease of $615,000 or 67.2% from the same period in 2002 primarily due to managements decision to spend less for advertising and promotion as a result of the continued weakness in the marketplace, offset in part by an increase in advertising and promotion expenses of $41,000 due to the Companys participation in the JBS.

Communications expense for the three months ended September 30, 2003, was $605,000, an increase of $37,000 or 6.5% from the same period in 2002 due primarily to a higher volume of call traffic and quotes and $90,000 relating to the Companys participation in the JBS.

Occupancy
  costs for the three months ended September 30, 2003 were $277,000, an increase
  of $54,000 or 24.2% from the same period in 2002. This increase was primarily
  due to the temporary rental addition of office space in Boca Raton, Florida,
  previously occupied by YDB, as well as an increase in occupancy cost relating
  to the JBS.

Other general and administrative expenses were $1.6 million, a decrease of $484,000 or 23.6% from the same period in 2002. This decrease was the result of the implementation of the Companys cost reduction program which included decreases in equipment rental costs, placement fees, professional fees, and supply, printing, postage and repair expenses, offset in part by an increase of $177,000 for the development of products relating to the JBS.

For the three months ended
  September 30, 2003, the Company made a provision for taxes of $60,000 due to the Companys income before income tax of $175,000. For the three months
  ended September 30, 2002, the benefit for income taxes was $483,000 due to loss before taxes of $1.2 million.





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Nine Months Ended September 30, 2003 Compared to Nine Months Ended September 30, 2002

Total revenues for the nine months ended September 30, 2003 were $18.2 million, a decrease of $67,000 or 0.4% from the same period in 2002.

Commission and fee income for the nine months ended September 30, 2003 was $14.6 million, a decrease of $325,000 or 2.2% from the same period in 2002 due to lower trading volume as result of the weak market conditions prevailing during the first quarter of 2003.

Investment banking revenues for the nine months ended September 30, 2003 were $931,000, a decrease of $279,000 or 23.1% from the same period in 2002 due to less activity in the new issue market.

Income from the Companys
  equity investment in SBS, for the nine months ended September 30, 2003 was $1,704,000 compared to income of $1,023,000, an increase of $681,000 or 66.6%
  from the same period in 2002. This increase was due to increased activity in the municipal bond market in the first and second quarter of 2003.  SBS
  serves as an underwriter for municipal bond offerings.

Trading profits were $617,000 for the nine months ended September 30, 2003, a decrease of $2,000 or 0.3% over the same period in 2002.

Interest and dividends for the nine months ended September 30, 2003 were $328,000, a decrease of $142,000 or 30.2% from the same period in 2002 primarily due to slightly lower cash balances available for temporary investment coupled with lower interest rates.

Total
  expenses for the nine months ended September 30, 2003 were $18.1 million, a
  decrease of $2.4 million or 11.8% from the same period in 2002.

Employee compensation and benefit costs for the nine months ended September 30, 2003 were $6.5 million, a decrease of $318,000 or 4.7% from the same period in 2002. This decrease was primarily due to a reduction in the number of employees to reflect trading volumes lower than experienced in past years and a decrease in commission payouts, offset in part by an increase in employee expenses of $169,000 due to the Companys participation in the JBS with Intuit.

Clearing and floor brokerage costs for the nine months ended September 30, 2003 were $3.0 million, an increase of $140,000 or 5.0% from the same period in 2002 primarily due to increased volume of trade executions, in addition to clearing costs of $60,000 due to the Companys participation in the JBS.

Advertising and promotion expenses for the nine months ended September 30, 2003 were $963,000, a decrease of $1,046,000 or 52.1% from the same period in 2002 primarily due to managements decision to spend less for advertising and promotion as a result of the continued weakness in the marketplace, offset in part by an increase in advertising and promotion expenses of $233,000 due to the Companys participation in the JBS.

Communications expense for the nine months ended September 30, 2003, was $2.1 million, an increase of $386,000 or 22.6% from the same period in 2002 due primarily to a higher volume of call traffic and quotes and $281,000 relating to the Companys participation in the JBS.

Occupancy costs for the nine
  months ended September 30, 2003 were $842,000, an increase of $158,000 or 23.1% from the same period in 2002. This increase was primarily due to the temporary
  addition of office space in Aventura and Boca Raton, Florida, previously occupied by YDB, as well as an increase in occupancy cost of $46,000 relating
  to the JBS.







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Other general and administrative expenses were $4.8 million, a decrease of $1.7 million or 26.5% from the same period in 2002. This decrease was primarily due to the expensing of start-up costs of $1.4 in the nine months ended September 30, 2002, as well as a result of the implementation of the Companys cost reduction program which included decreases in placement fees, professional fees, and supply and printing expenses, offset in part by an increase of $758,000 for the development of products relating to the JBS for the nine months ended September 30, 2003.

For the nine months ended September 30, 2003, the Company made a provision for taxes of $22,000 due to the Companys income before income tax of $89,000. For the nine months ended September 30, 2002, the benefit for income taxes was $922,000 due to loss before taxes of $2.3 million.

Liquidity and Capital Resources

The Companys assets are highly liquid, consisting generally of cash, money market funds and marketable securities.  The Companys total assets at September 30, 2003 were $40.2 million. As of that date, $27.3 million, or 68%, of total assets were regarded by the Company as highly liquid.

Siebert is subject to the net capital requirements of the SEC, the NYSE and other regulatory authorities.  At September 30, 2003, Sieberts regulatory net capital was $15.6 million, $15.3 million in excess of its minimum capital requirement of $250,000.

As
  described under Recent Developments above, Siebert and Intuit have
  incurred other charges aggregating approximately $485,000 for the setup of the
  JBSs Web site and related matters. Siebert and Intuit  shared equally
  in these charges under the Agreement. See Recent Developments above
  concerning litigation with Intuit over the JBS and the Agreement.

The Company also intends to acquire additional shares of its common stock pursuant to its share buy back program.

Siebert has entered into a Secured Demand Note Collateral Agreement with SBS under which it is obligated to lend to SBS up to $1.2 million pursuant to a secured promissory note on a subordinated basis.  Amounts pledged by Siebert under the facility are reflected on the Companys balance sheet as cash equivalents  restricted.  SBS pays Siebert interest on this amount at the rate of 10% per annum.  The facility expires on August 31, 2005, at which time SBS is obligated to repay to Siebert any amounts borrowed by SBS thereunder.

Item
  3.  Quantitative and Qualitative Disclosures About Market Risk

Working capital is generally temporarily invested in dollar denominated money market funds and overnight certificates of deposits.  These investments are not subject to material changes in value due to interest rate movements. The Company also invests in certain short-term municipal bonds, the values of which may fluctuate during the period they are held by the Company.

In the normal course of its
  business, Siebert enters into transactions in various financial instruments with off-balance sheet risk.  This risk includes both market and credit
  risk, which may be in excess of the amounts recognized in the Companys financial statements.  Retail customer transactions are cleared through
  clearing brokers on a fully disclosed basis. If customers do not fulfill their contractual obligations, the clearing broker may charge Siebert for any
  loss incurred in connection with the purchase or sale of securities at prevailing market prices to satisfy the customers obligations. Siebert regularly
  monitors the activity in its customer accounts for compliance with its margin requirements. Siebert is exposed to the risk of loss on unsettled customer
  transactions if customers and other counter parties are unable to fulfill their contractual obligations.







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Item 4.  Controls and Procedures

The
  Company carried out an evaluation, under the supervision and with the participation of management, including the Companys Chief Executive Officer
  and Chief Financial Officer, of the effectiveness of the design and operation of the Companys disclosure controls and procedures as of the end of
  the period covered by this report pursuant to Exchange Act Rule 13a-15. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer
  concluded that the Companys disclosure controls and procedures were effective in timely alerting them to material information relating to the Company
  (including its consolidated subsidiaries) required to be included in the Companys periodic Securities and Exchange Commission filings.



There were no changes in the Companys internal control over financial reporting that occurred during the Companys most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Companys internal control over financial reporting.

SFC Third Quarter 2003



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Part II - OTHER INFORMATION

Item 1.

Legal Proceedings

See Part I-Item 1 Financial Statements-Strategic Alliance Agreement and Part I-Item 2 Managements Discussion and Analysis of Financial Condition and Results of Operations-Recent Development with respect to the Companys lawsuit against Intuit Inc. In addition, the Company is involved in various routine lawsuits of a nature deemed by the Company customary and incidental to its business which in the opinion of management, the ultimate disposition of such actions will not have a material adverse effect on its financial position or results of operations.

Item 2.

Changes in Securities and Use of Proceeds

None

Item 3.

Defaults Upon Senior Securities

None

Item 4.

Submission of Matters to a Vote of Security Holders

None

Item 5.

Other Information

None

Item 6.

Exhibits and Reports on Form 8-K



(a)

Exhibits.



|31.1 | Certification of Muriel F. Siebert pursuant to Exchange Act Rules 13a-14 and 15d-14, as adopted pursuant to Section
      302 of the Sarbanes-Oxley Act of 2002.  
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------
|31.2 | Certification of Joseph M. Ramos, Jr. pursuant to Exchange Act Rule 13a-14 and 15d-14, as adopted pursuant to
      Section 302 of the Sarbanes-Oxley Act of 2002.
|32.1 | Certification of Muriel F. Siebert of Periodic Financial Report under Section 906 of the Sarbanes-Oxley Act of
      2002.                                        
|32.2 | Certification of Joseph M. Ramos, Jr. of Periodic Financial Report under Section 906 of the Sarbanes-Oxley Act
      of 2002.                                     



(b)

Reports on Form 8-K.

The
  Companys Current Report on Form 8-K, dated September 18, 2003, relating to the lawsuit against Intuit Inc.



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SIGNATURES



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



SIEBERT FINANCIAL CORP.



By: /s/ Muriel F. Siebert

Muriel F. Siebert

Chairwoman and
  President

(principal
  executive officer)







Dated:  November 14, 2003





By: /s/ Joseph M. Ramos, Jr



Joseph M. Ramos,
  Jr.

Executive Vice
  President and Chief Financial Officer

(principal
  financial and accounting officer)







Dated:  November 14,
  2003







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