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

                                   FORM 10-QSB

                                   (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

           For the Transition period from ____________ to ____________

                         COMMISSION FILE NUMBER 0-27757

                              CASE FINANCIAL, INC.

             (Exact Name of registrant as specified in its charter)

            Delaware                                      33-0529299
            --------                                      ----------
  (State or other jurisdiction                        (I.R.S. Employer
of incorporation or organization)                    Identification No.)

               5950 La Place Court, Suite #155, Carlsbad, CA 92008
              ----------------------------------------------------
                    (Address of principal executive offices)

                                 (760) 804-1449
              (Registrant's telephone number, including area code)

         Securities registered under Section 12(g) of the Exchange Act:

                         COMMON STOCK, $0.001 PAR VALUE
                         ------------------------------
                                (Title of class)

Check whether the Issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the issuer was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes |X| No |_|

 AS OF AUGUST 1, 2005 THERE WERE 24,019,236 SHARES OF COMMON STOCK OUTSTANDING.

Transitional Small Business Disclosure Format (check one). Yes |_| No |X|

<PAGE>

                                TABLE OF CONTENTS

                                                                            Page

                         PART I - FINANCIAL INFORMATION

Item 1.        FINANCIAL STATEMENTS                                           2

Item 2.        MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION     13

Item 3.        CONTROLS AND PROCEDURES                                       18

                           PART II - OTHER INFORMATION

Item 1.        LEGAL PROCEEDINGS                                             18

Item 5.        OTHER INFORMATION                                             20

Item 6.        EXHIBITS                                                      20

SIGNATURES                                                                   20

                                        1
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEET
                                   (Unaudited)

                                  JUNE 30, 2005

<TABLE>
<CAPTION>
<S>                                                                                                   <C>
ASSETS

Cash                                                                                                  $    105,659

Investments in contracts - net of allowance for contract losses of
$496,261                                                                                                 1,862,617

Loans receivable - net of allowance for bad debts of
$99,851                                                                                                    187,613

Prepayments and other assets                                                                               177,379

Receivables and other assets, related parties, net of impairment allowance of
$122,520                                                                                                    34,244

Equipment, at cost, net of accumulated depreciation of $182,006
                                                                                                             6,410

Notes receivable from affiliate , net of impairment allowance of $832,149                                       --
                                                                                                      ------------
     TOTAL ASSETS                                                                                     $  2,373,922
                                                                                                      ============

LIABILITIES AND STOCKHOLDERS' DEFICIENCY


Accounts payable and accrued expenses                                                                 $    995,387
Non recourse loans payable - related parties                                                             1,484,681

Non recourse loans payable                                                                                 278,549

Convertible debentures payable                                                                             271,055

Loans payable - related parties                                                                          3,460,000

Loans payable                                                                                              270,000

     TOTAL LIABILITIES
                                                                                                      $  6,759,672

STOCKHOLDERS' DEFICIENCY

Common stock, par value $0.001 per share,

100,000,000 shares authorized, 24,019,236 shares issued and
 outstanding                                                                                                24,019

Paid-in-capital                                                                                          9,061,042
                                                                                                      ------------
Accumulated deficit                                                                                    (13,470,812)
                                                                                                      ------------

     TOTAL STOCKHOLDERS'  DEFICIENCY                                                                  (4,385,750,)
                                                                                                      ------------
     TOTAL LIABILITIES AND
          STOCKHOLDERS' DEFICIENCY                                                                    $  2,373,922
                                                                                                      ============
</TABLE>


See accompanying notes to unaudited consolidated financial statements.

                                        2
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                     Three month            Three month             Nine month
                                                                     period ended          period ended            period ended
                                                                    June 30, 2005          June 30, 2004           June 30, 2005
                                                                  -------------------    ------------------      ------------------
<S>                                                                 <C>                    <C>                     <C>
REVENUE

      Contract fees                                                 $       --             $    191,535            $     71,027
      Service fees, related parties                                        7,125                 20,017                  11,517
                                                                  -------------------    ------------------      ------------------
            TOTAL REVENUE                                                  7,125                211,552                  82,543

OPERATING EXPENSES

      Provision for losses on investments in contracts                      (500)               104,087                  33,524

      Provision for impairment of notes and other
      receivables from affiliate                                            --                     --                      --

      General and administrative                                         141,251                358,972                 599,139

      Sales and marketing                                                   --                   46,932                   3,542
                                                                  -------------------    ------------------      ------------------
         TOTAL OPERATING EXPENSES                                        140,751                509,991                 636,204
                                                                  -------------------    ------------------      ------------------

      LOSS FROM OPERATIONS                                              (133,626)              (298,439)               (553,661)

OTHER INCOME (EXPENSE)

      Interest income                                                         36                    318                     417

      Interest expense                                                  (107,502)              (104,358)               (314,836)

      Non-cash finance expenses                                          (50,670)              (296,804)               (158,573)

      Miscellaneous Income                                                  --                     --                      --
                                                                  -------------------    ------------------      ------------------

         TOTAL OTHER INCOME (EXPENSE)                                   (158,137)              (400,844)               (472,993)
                                                                  -------------------    ------------------      ------------------

      NET LOSS                                                      $   (291,763)          $   (699,283)           $ (1,026,654,)
                                                                  ===================    ==================      ==================

      Net Loss per common share - basic and diluted                        (0.02)                 (0.04)                  (0.05)

      Weighted average number of common shares                        17,250,005             16,464,485              18,854,371
                                                                  ===================    ==================      ==================

<CAPTION>
                                                                       Nine month
                                                                      period ended
                                                                      June 30, 2004
                                                                    ------------------
<S>                                                                   <C>
REVENUE

      Contract fees                                                   $    499,369
      Service fees, related parties                                         43,541
                                                                    ------------------
            TOTAL REVENUE                                                  542,910

OPERATING EXPENSES

      Provision for losses on investments in contracts                      85,913

      Provision for impairment of notes and other
      receivables from affiliate                                            (8,911)

      General and administrative                                         1,119,144

      Sales and marketing                                                  188,270
                                                                    ------------------
         TOTAL OPERATING EXPENSES                                        1,384,416
                                                                    ------------------

      LOSS FROM OPERATIONS                                                (841,506)

OTHER INCOME (EXPENSE)

      Interest income                                                          489

      Interest expense                                                    (283,579)

      Non-cash finance expenses                                           (390,169)

      Miscellaneous Income                                                   2,313
                                                                    ------------------

         TOTAL OTHER INCOME (EXPENSE)                                     (670,946)
                                                                    ------------------

      NET LOSS                                                        $ (1,512,452)
                                                                    ==================

      Net Loss per common share - basic and diluted                          (0.09)

      Weighted average number of common shares                          16,464,485
                                                                    ==================
</TABLE>

See accompanying notes to unaudited consolidated financial statements.

                                        3

<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (unaudited)
<TABLE>
<CAPTION>
                                                                                Nine month period ended         Nine month period
                                                                                      June 30, 2005             ended June 30, 2004
                                                                                --------------------------    ----------------------
CASH FLOWS FROM OPERATING ACTIVITIES:

<S>                                                                              <C>                           <C>
Net loss                                                                         $    (1,026,654,)             $    (1,512,452)
Adjustments to reconcile net loss to net cash used in operating activities:

      Depreciation                                                                         16,542                       35,964
      Amortization of Debt Premium                                                         50,565                      121,244
      Provision for losses on investments in contracts                                     33,524                       85,913
      Beneficial conversion feature                                                         3,188                            -
      Impairment of notes receivable of affiliate                                                                       (8,911)
      Amortization warrants issued with debt                                               82,300                       18,228
      Common stock issued with debt                                                             -                      294,394
      Common stock and options for compensation                                                 -                      115,566

   Changes in operating assets and liabilities
          (Increase) decrease in prepayments and other assets                              49,076                        7,575

          Increase (decrease) in accounts payable and other liabilities                   108,817                       92,165
                                                                                --------------------------    ----------------------
           Net cash used in operating activities                                         (682,641)                    (750,314)
                                                                                --------------------------    ----------------------

CASH FLOWS FROM INVESTING ACTIVITIES:

      Investment in contracts  -- advances and loans                                            -                     (526,157)
      Investment in contracts  -- collections                                              156,026                     652,455
      Increase in loans receivable-advances                                                     -                     (677,500)
      Decrease in loans receivable - collections                                           603,567                     487,500
      Principal repayments on notes receivable from affiliate                                   -                          141
      Purchase of equipment                                                                (2,881)                           -
                                                                                --------------------------    ----------------------
           Net cash used in investing activities                                           756,712                     (63,561)
                                                                                --------------------------    ----------------------

CASH FLOWS FROM FINANCING ACTIVITIES:

   Proceeds from borrowings                                                                     -                       476,360
   Proceeds from issuance of stocks                                                        490,000                            -
   Repayments of borrowings                                                                (2,216)                    (305,837)
   Proceeds from related party borrowings                                                   70,637                    1,121,673
   Repayments of related party borrowings                                                (560,216)                    (488,086)
                                                                                --------------------------    ----------------------
         Net cash provided by financing activities                                          (1,795)                      804,110
                                                                                --------------------------    ----------------------
NET INCREASE (DECREASE) IN CASH                                                             72,276                      (9,765)

CASH - BEGINNING OF PERIOD                                                                  33,383                      192,651
                                                                                --------------------------    ----------------------

CASH - END OF PERIOD                                                             $         105,659             $        182,886
                                                                                ==========================    ======================

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
  Cash paid during the nine month period for:
     Interest                                                                    $           1,226             $        129,611
     Income taxes                                                                $           4,980             $          5,820

See accompanying notes to unaudited consolidated financial statements.
</TABLE>

                                        4
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements For the three and nine
months ended June 30, 2005

NOTE 1: NATURE OF ACTIVITIES

Case Financial, Inc. was incorporated in 1998 and completed a reverse
acquisition with Asia Web Holdings, Inc. ("Asia Web"), a publicly traded company
incorporated in the State of Delaware, on May 24, 2002. As part of the
transaction, Asia Web changed its name to Case Financial, Inc. and continued the
business of the Company. Case Financial, Inc. and its subsidiaries, Case
Financial, LLC, and Case Capital Corporation, (collectively "Case" or the
"Company") provide pre-settlement and post-settlement litigation funding
services to attorneys (and, previously, plaintiffs) involved in personal injury
and other contingency litigation, conducted primarily within the California
courts.

The Company's funding services have included advances to attorneys and
previously, plaintiffs, which are non-recourse, meaning that the investment
principal, success fees and interest are repaid only when the case is settled or
favorably adjudicated in court. These investments are collateralized solely by
the potential proceeds of underlying litigation. The Company records such
advances as investments in contracts.

In April 2003, Case Capital Corporation became a licensed California finance
lender and making interest-bearing short-term collateralized loans (Recourse
Bridge Loan Program) to attorneys for cases which have settled but are awaiting
disbursement of settlement proceeds. The Company charges loan fees in connection
with these loans. In addition, interest is charged on these loans if they are
not repaid by a specified date. These term loans are typically recourse and
collateralized by the proceeds of the case as well as the assets of the
borrowers, typically law firms and attorneys, and personal guarantees from the
attorneys. These loans are recorded by the Company as Loans Receivable.

At a Board of Directors meeting held October 7, 2004, five directors resigned
from the Board and an officer of the Company relinquished his positions as Chief
Executive Officer and Chief Financial Officer of the Company. At the same
meeting, the Board of Directors appointed five directors to fill the seats
created by submission of resignations effective as of the adjournment of the
meeting and a new Chairman of the Board of Directors was appointed in the
meeting.

The Company has experienced substantial operating losses since completing its
reverse acquisition with Asia Web and, as a result, depleted its working capital
available for new advances under its loan programs. The new Board of Directors
and management is evaluating the viability of its litigation financing business
and, if determined not viable, will seek out new business opportunities. In the
interim, management efforts are being focused on maximizing revenues and
collections on existing investments in addition to raising additional capital to
provide the Company needed cash resources to either resume its existing business
or pursue new opportunities

Operations are conducted from leased premises in Carlsbad, California.

Basis of presentation:

The accompanying unaudited condensed consolidated interim financial statements
have been prepared in accordance with the rules and regulations of the
Securities and Exchange Commission for the presentation of interim financial
information, but do not include all the information and footnotes required by
generally accepted accounting principles for complete financial statements. The
audited consolidated financial statements for the year ended September 30, 2004
were filed on February 2, 2005 with the Securities and Exchange Commission and
are hereby referenced. In the opinion of management, all adjustments considered
necessary for a fair presentation have been included. Operating results for the
three and nine months ended June 30, 2005 are not necessarily indicative of the
results that may be expected for the year ended September 30, 2005. The
accompanying financial statements include the accounts of Case Financial Inc.
and its subsidiaries Case Financial, LLC, and Case Capital Corporation. All
significant inter-company accounts, transactions and profits have been
eliminated upon consolidation and combination.

Revenue recognition:

Contract fee income from investments in contracts is recognized once collection
is assured, usually upon receipt of cash, after a case is settled or favorably
adjudicated. Selling commissions are expensed as incurred. An investment in a
contract is deemed fully or partially uncollectible when the case is dismissed,
abandoned, or settled for an amount less than the Company's investment.

The Company also participates in and services investments in contracts with
third party investors. At times, the Company participates in these investments.
In the case of these third party investments, the Company receives a success fee
equal to a percentage of the income generated upon successful resolution of the
underlying case, at which time revenue is recorded. These third party
investments are collateralized by specifically identified investments in
contracts and are repayable to the investor only upon successful resolution and
collection on the underlying case, along with the fees earned, less the agreed
upon success fee to the Company. Third party investors bear financial risk with
respect to the underlying investment in a contract in relation to their
proportionate interest in the principal advanced for such contract. These
advances from third party investors are recorded as loans payable, non recourse.
Contract fees are presented net of amounts paid to third party participants.

                                       5
<PAGE>
                      CASE FINANCIAL, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements For the three and nine
months ended June 30, 2005

The Company has established an allowance for investments in contracts and loans
receivable that may become uncollectible. These allowances are maintained at a
level which, in management's judgment, is adequate to absorb losses in the
contract investment portfolio.

No allowance is recorded for investments in contracts or loans receivable to the
extent funded through third party investments as the risk of loss is born by the
investor and, in the event of such loss, the loans payable non recourse accounts
would be reduced pro rata with the loss recorded.

Loan fees and interest, net of direct costs, charged on loans receivable with
terms in excess of ninety (90) days are deferred and amortized over the life of
the related loan using the effective interest method. Loan fees on short term
loans are generally recognized over the term of the loan. Interest on these
loans is accrued as earned.

The Company earns service fees from a contract entered into with two entities
including the prior Case Financial, Inc. and its affiliate, Case Financial
Funding, Inc ("Old CFI"). The Company manages Old CFI's portfolios of
investments for a fee equal to 15% of gross amounts collected on its behalf.
Further, in February 2005, the Company has acquired a 65.63% interest in the
outstanding case portfolio of Case Financial Funding Inc., a subsidiary of Old
Case. This investment was recorded by the Company as investment in contracts.

Use of estimates:

The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
certain estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual amounts could differ from those estimates.

A significant estimate is the allowance for losses on investments in contracts
and loans receivable. Because of the inherent uncertainties in estimating the
allowance for losses on investments in contracts and loans receivable, it is
likely that the Company's estimate of the allowance for losses on investments in
contracts and loans receivable will change as circumstances become better known.
Management closely monitors the progress of each case in order to reevaluate its
estimate of uncollectible investments in contracts and loans receivable.

RECLASSIFICATIONS

Certain comparative amounts have been reclassified to conform with the current
year's presentation.

Stock-based compensation:

The Company accounts for stock-based compensation arrangements in accordance
with the provisions of SFAS No. 123, "Accounting for Stock-Based Compensation"
which establishes a fair value-based method of accounting for stock-based
compensation plans. Under SFAS No. 123, compensation cost is recognized based on
the difference, if any, on the date of grant between the fair value of the
Company's common stock and the amount the grantee must pay to acquire the stock.
The Company uses the Black-Scholes option pricing model to determine the fair
value of each stock option granted

Loss per common share:

Basic and diluted loss per common share is computed by dividing the net loss by
the weighted average number of common shares outstanding for each of the periods
presented. The weighted average number of common shares outstanding for
computing the basic and diluted loss per common share was 17,250,005 and 18,854
,371 for the three month period and nine month period ending June 30, 2005 and
16,464,485 for both basic and diluted loss per share for the three months and
nine months ended June 30, 2004. The weighted average number of common shares
outstanding does not include 4,935,833 and 6,560,833 options and warrants
outstanding at June 30, 2005 and 2004, respectively, because they are
anti-dilutive.

CUSTOMER CONCENTRATIONS

As of June 30, 2005, one law firm customer represented approximately 53% of the
portfolio of investments in contracts and loans receivable. For the nine months
ended June 30, 2005, two other law firms represented approximately 49% and 17%,
respectively of the total revenue for the period.

NOTE 2: INVESTMENTS IN CONTRACTS

At June 30, 2005, investments in contracts, net of allowance for contract losses
of $496,261, were $ 1,862,617.

                                       6
<PAGE>
                      CASE FINANCIAL, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements For the three and nine
months ended June 30, 2005

The Company's investment in contracts consists of investments funded through the
Company's own cash resources as well as investments funded through non recourse
loans payable from third parties. Third party investors bear financial risk with
respect to the underlying investment in a contract in relation to their
proportionate interest in the principal advanced for such contract.

On February 28, 2005, the Company purchased a 65.63% interest in the remaining
case portfolio of Case Financial Funding, Inc, a subsidiary of Old Case ("CFF"),
by acquiring 65.63% of the secured notes issued by CFF that provide the holder
with a secured interest in the proceeds of the outstanding cases of CFF. As
consideration for this purchase, the Company issued a convertible debenture in
the amount $287,000. The principal amount of the debenture is due and payable in
full two years from the date of issue unless converted into common stock of the
Company at a conversion price of $0.15 per share. The Company has the right at
anytime, after one year, to require conversion of the debenture into shares of
common stock at $0.15 per share, provided that: the stock at anytime trades at
30 cents or higher for a consecutive period of 30 trading days. Interest is
payable semi-annually at a rate of 5% per annum.

The Company records fee income once collection is assured, usually upon receipt
of cash, after the case is settled or successfully adjudicated.

A summary of the activity in investments in contracts (excluding the allowance
for contract losses) for the three and nine months ended June 30, 2005 is as
follows:

                                  Three Months Ended           Nine Months Ended
                                    June 30, 2005              June 30, 2005
                                 ----------------------------------------------
Beginning Balance                $        2,359,378            $      2,227,904
Adjustments to Receivables                        0                      35,000
Purchase of CFF portfolio                         0                     287,000
Collections                                    (500)                   (191,026)
Write-Offs                                        0                           0
                                 ----------------------------------------------
Ending Balance                   $        2,358,878            $      2,358,878
                                 ==============================================

In conjunction with new management's investigation of the Company's finances,
outside counsel has been retained to pursue collection on the majority of the
Company's portfolio of investments in contracts and loans receivable and the
allowance for contract losses for both loans receivable and investments in
contracts has been increased to an amount equal to the principal and accrued
revenue balances outstanding as of June 30, 2005 on all non third party funded
loans receivable and investments in contracts less collections to date. A
summary of allowance for contract losses is as follows:

                                 Three Months Ended            Nine Months Ended
                                   June 30, 2005               June 30, 2005
                                 ----------------------------------------------
Beginning Balance                $          496,761            $        462,737

Increases to the Allowance                        0                      34,024

Adjustment to the Allowance                    (500)                       (500)
                                 ----------------------------------------------
Ending Balance                   $          496,261            $        496,261
                                 ==============================================

NOTE 3: LOANS RECEIVABLE

In April 2003, Case Capital Corporation became a licensed California finance
lender and in August 2003 began making interest-bearing collateralized term
loans. The Company charges loan fees in connection with these term loans. In
addition, interest is charged on these loans if the loans are not repaid by a
specified date, which is generally before the maturity date.

A summary of the activity in loans receivable excluding the allowance for bad
debts of $ 99,851 for the three and nine months ended June 30, 2005 is as
follows:

                                       7
<PAGE>
                      CASE FINANCIAL, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements For the three and nine
months ended June 30, 2005
                                 Three Months Ended            Nine Months Ended
                                   June 30, 2005               June 30, 2005
                                 ----------------------------------------------
Beginning Balance                $          289,459            $        891,031

New Loans                                         0                           0

Collections                                  (1,995)                   (603,567)
                                 ----------------------------------------------
Ending Balance                   $          287,464            $        287,464
                                 ==============================================

Included in loans receivable as of June 30, 2005 is $170,000 in loans to a
single law firm for a group of similar cases, $100,000 of which have been funded
through third party investments. In addition, as of June 30, 2005 the Company
had accrued revenue to accounts receivable of $206,338 on these cases and
collected $132,276 as of June 30, 2005. These funds were advanced over a
seven-month period while the cases were in the process of settling. The Company
had received notification that the settlements are now substantially complete on
these cases however there have been numerous legal delays in obtaining final
court approval for disbursement of funds. Accordingly, the Company has entered
into an agreement with PCI LLC, the principal third party investor in these
cases, and a related party through its affiliation with a major stockholder, to
oversee collection of the remaining balances under these cases. Further, the
Company has increased its allowance for bad debts by $99,851 as of June 30, 2005
representing 100% of uncollected principal and accrued fees still outstanding.

NOTE 4: LOANS PAYABLE, RELATED PARTIES

As of June 30, 2005, related party debt consists of the following:

<TABLE>
<CAPTION>
<S>                                                                                  <C>
Non recourse loans payable - Notes to major stockholders, officers and directors
collateralized by specifically identified investments in contracts, payable upon
settlement of the related investments in contracts plus either 75% or 50% of the
fee income earned thereon. Repayment of these notes is contingent upon recovery
of the specifically identified investments in contracts.                             $  1,484,681

Note payable to major stockholder, uncollateralized, interest
payable monthly at 12.0% per annum, due December 12, 2006(1)                            2,000,000

Secured note payable, major shareholder,  secured by a lien on all assets of the
Company,  interest  payable  monthly at 12.0% per annum,  due September 8, 2004,
This note payable is currently in default. (2)                                            500,000

Note payable, unsecured,  payable May 23, 2004 plus interest at
8% per annum. This note payable is currently in default (3)                               600,000

Notes payable, uncollateralized, interest payable monthly at
12.0% per annum, due January 1, 2007 (4)                                                  150,000

Promissory demand notes, unsecured , interest payable monthly
at 12.0% per annum (5)                                                                    140,000

Loan payable, unsecured, to a former director                                              70,000
                                                                                    -------------
                                                                                     $  4,944,681
                                                                                    =============
</TABLE>

(1) This loan also included warrants to purchase 2,000,000 shares of the common
stock of the Company at $0.50 per share and warrants to purchase 1,000,000
shares of the common stock of the Company at $0.80 per share that expire in four
years. CCWIPP agreed to a deferral on interest payments and a suspension of any
collection actions for defaults previously asserted under this note, including
the failure to register the common shares underlying these warrants for resale,
for a period of six months, commencing with the date of the interest payment
that had been due for February 2004. In consideration of this deferral, the
Company agreed to reduce the exercise price on the warrants to purchase
1,000,000 shares of the common stock of the Company at $0.80 to a revised
exercise price of $0.50 per share. The Company is in default on this loan and
has been unable to resume interest subsequent to the expiration of this deferral
in July 2004 and, as of June 30, 2005, total accrued interest totaled $339,288.

                                       8
<PAGE>

(2) In March 2004, the Company entered into a $500,000 secured loan agreement
with the CCWIPP. This loan was due and payable in a lump sum, inclusive of
interest at the rate of 12% per annum, on or before the sooner of the date the
Company had completed additional equity financings aggregating in excess of $3.0
million or September 8, 2004. The loan is secured by a lien on all assets of the
Company. As additional consideration for this loan, the Company issued 1,000,000
shares of its common stock to the lender. The market value as of the date of the
loan of the common stock issued has been amortized over the life of the loan
resulting in a charge for three months ended March 31, 2005 of $450,000 to
non-cash finance expense. The Company is in default on this loan and, as of June
30, 2005, total accrued interest totaled $78,833.

(3) In May 2002 in conjunction with the acquisition of Case Financial LLC, the
Company assumed $700,000 in unsecured promissory notes, bearing interest at 8%,
which, at the time assumed were payable to two related-party stockholders. The
first note for $600,000, which was due in May 2004, was to Harvey Bibicoff, a
former director and former interim CEO and CFO of the Company. On March 30,
2004, Mr. Bibicoff agreed to a six month deferral on interest payments
commencing with the interest payment that had been due for March 2004 and a
deferral of the principal payment to December 31, 2004. In addition, he agreed
to a suspension of any collection actions for any prior defaults under this
note. The second note, for $100,000, was to a relative of Eric Alden, the
Company's former CEO. As of June 7, 2004, the Company entered into an agreement
and mutual release with Eric Alden which included provisions for this former
officer, director and shareholder to divest of the majority of his shares of the
Company's common stock. The new management, which assumed control as of October
7, 2004 is investigating the adequacy of the consideration and the legal
validity of the release. As a result of the foregoing, the Company has
reclassified the $100,000 unsecured promissory note due May 2005 from Loans
Payable-Related Parties to Loans Payable. The noteholder has informed the
Company that this $100,000 note was due May 2004. The Company is investigating
this matter. The Company is in default on both of these notes due to non payment
of interest (and principal, in the case of the $600,000 note) and, as of June
30, 2005, total accrued interest on the $600,000 totaled $76,000.

(4) Effective January 1, 2003, an accredited investor, which is now a related
party through its affiliation with CCWIPP, converted an investment in the
Company by exchanging a four year, 9.85% per annum promissory note for a four
year, 12% per annum promissory note issued by the Company. The principal amount
of the promissory note was $150,000. As part of the conversion, the Company
cancelled four year warrants to purchase 75,000 shares of common stock at $0.60
per share, and issued four year warrants to purchase: (i) 150,000 shares of
common stock at an exercise price of $0.50 and (ii) 75,000 shares of common
stock at an exercise price of $0.80. The Company also agreed to register the
common stock underlying the warrants for resale. On March 30, 2004, in
conjunction with changes the Company implemented with respect to its senior
management and its Board of Directors, the lender agreed to a deferral on
interest payments under this note and a suspension of any collection actions for
prior defaults under this note, commencing with the payment that had been due
for January 2004 for a period of six months. In consideration of this deferral,
the Company agreed to reduce the exercise price on warrants to purchase 75,000
shares of the common stock of the Company at $0.80 to a revised exercise price
of $0.50 per share. All other terms of the warrants remain unchanged. The
increase in the fair value of the foregoing warrants as a result of the
reduction in the exercise price as well as the initial value are being amortized
over the remaining life of the warrants and charged to non-cash finance expense.
The Company is in default on this note due to non payment of interest and, as of
June 30, 2005, total accrued interest totaled $27,000.

(5) The Company had outstanding as of June 30, 2005, $140,000 in unsecured
promissory demand notes ($40,000 at an interest rate of 12% per annum,$75,000 at
an interest rate of 12% per annum and $25,000 at an interest rate of 12% per
annum), all to former directors. The holders of these demand notes agreed to a
deferral on interest payments and the principal payment commencing with the
interest payment due March 2004 for a period of six months. The Company is in
default on these notes due to non payment of interest and, as of June 30, 2005,
total accrued interest totaled $28,499

The Company recorded interest expense of $ 287,553 and $97,617 for the nine
month period and three month period ending June 30, 2005. The Company recorded
interest expense of $ 259,441 and $95,524 for the nine month period and three
month period ending June 30, 2004.

                                       9
<PAGE>

NOTE 5: LOANS PAYABLE, UNRELATED PARTIES
<TABLE>
<CAPTION>
As of June 30, 2005, unrelated party debt consists of the following:
                                                                                       June 30, 2005
<S>                                                                                      <C>
Non recourse loans payable - Notes collateralized by specifically identified
investments in contracts, payable upon settlement of the related investments in
contracts plus either 75% or 50% of the fee income earned thereon. Repayment of
these notes is contingent upon recovery of the specifically identified
investments in contracts
                                                                                           $ 278,549

Note payable unsecured payable May 23, 2004 plus interest at 8% per annum.,
This note payable is currently in default.                                               (1) 100,000

Notes payable, uncollateralized, interest payable monthly at 12.0% per annum,
due January 1, 2007                                                                       (2) 50,000

Promissory demand notes, unsecured, interest payable monthly at
12.0% per annum                                                                           (3)120,000

                                                                                            $548,549
                                                                                          ----------
</TABLE>

(1) In May 2002 in conjunction with the acquisition of Case Financial LLC, the
Company assumed $700,000 in unsecured promissory notes, bearing interest at 8%,
which, at the time assumed were payable to two related-party stockholders. The
first note for $600,000, which was due in May 2004, was to a former director and
former interim CEO and CFO of the Company. The second note, for $100,000, was to
a relative of the Company's former CEO. As of June 7, 2004, the Company entered
into an agreement and mutual release with the former CEO which included
provisions for this former officer, director and shareholder to divest of the
majority of his shares of the Company's common stock. The new management, which
assumed control as of October 7, 2004 is investigating the adequacy of the
consideration and the legal validity of the release. As a result of the
foregoing, the Company has reclassified the $100,000 unsecured promissory note
due May 2005 from Loans Payable-Related Parties to Loans Payable. The noteholder
has informed the Company that this $100,000 note was due May 2004. The Company
is investigating this matter. The Company is in default on this note due to non
payment of interest and, as of June 30, 2005, accrued interest totaled $6,667.

(2) The principal amount of this promissory note was $50,000. Effective January
1, 2003, the noteholder converted their investment in the Company by exchanging
a four year, 9.85% per annum promissory note for a four year, 12% per annum
promissory note. As part of the conversion, the Company cancelled four year
warrants to purchase 25,000 shares of common stock at $0.60 per share, and
issued four year warrants to purchase: (i) 50,000 shares of common stock at an
exercise price of $0.50 and (ii) 25,000 shares of common stock at an exercise
price of $0.80. The Company also agreed to register the common stock underlying
the warrants for resale. The Company is in default on this note due to non
payment of interest and, as of June 30, 2005, accrued interest totaled $6,000.

(3) The Company had outstanding as of June 30, 2005, $120,000 in unsecured
promissory demand notes to the former CEO and a relative of the former CEO which
bear interest at 12%. The Company is in default on these notes due to non
payment of interest and, as of June 30, 2005, accrued interest totaled $21,340.

The Company recorded interest expense of $ 21,268 and $ 7,090 for the nine month
period and three month period ending June 30, 2005. The Company recorded
interest expense of $ 23,463 and $ 8,589 for the nine month period and three
month period ending June 30, 2004.

NOTE 6: CONVERTIBLE DEBENTURES AND ACQUISITION OF CASE PORTFOLIO

On February 28, 2005, the Company purchased a 65.63% interest in the remaining
case portfolio of Case Financial Funding, Inc, a subsidiary of Old Case ("CFF"),
by acquiring 65.63% of the secured notes issued by CFF that provide the holder
with secured interest in the proceeds of the outstanding cases of CFF. As
consideration for this purchase, the Company issued a convertible debenture in
the amount $287,000. The principal amount of the debenture is due and payable in
full two years from the date of issue unless converted into common stock of the
Company at a conversion price of $0.15 per share. The Company has the right at
anytime, after one year, to require conversion of the debenture into shares of
common stock at 15 cents per share, provided that: the stock at anytime trades
at 30 cents or higher for a consecutive period of 30 trading days. Interest is
payable semi-annually at a rate of 5% per annum. The Company recorded the
beneficial conversion feature associated with the convertible debentures for $
19,133. The Company has recorded interest expense for $ 3,188 for the nine month
period ended June 30, 2005. The convertible debentures have been shown net of
beneficial conversion feature at $ 271,055 as on June 30, 2005.

                                       10
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES

Notes to Unaudited Consolidated Financial Statements For the three and nine
months ended June 30, 2005

NOTE 7: STOCKHOLDER'S DEFICIENCY

PRIVATE PLACEMENT:

During the nine month period ended June 30, 2005, the Company issued 7,000,000
shares of common stock in a private placement issued pursuant to Rule 506 of
Regulation D of the Securities Act of 1933 (the "Offering"). The Offering
consisted of 14 units each including 500,000 shares of the Company's common
stock at a purchase price of $0.07 per share together with a warrant to purchase
an additional 500,000 shares of the Company's common stock at $0.10 per share.
The warrant shall expire two years from the date of issue. After one year from
date of issue, if the Company's common stock closing price exceeds $0.20 per
share for a continuous 30 day period, the holder of the warrant shall have 45
days from the end of such 30 day period to exercise. The gross proceeds received
for this offering were $490,000. (See Note 8- Related Party Transactions )

STOCK OPTIONS:

During the nine month period ended June 30, 2005, the Company did not issue any
options to purchase shares of common stock. In addition, options to purchase
1,625,000 shares of its common stock expired during the nine month period ended
June 30, 2005.

NOTE 8: RELATED PARTY TRANSACTION

Participating in the Offering described in Note 7 above were the following
related parties:

                                     Investment      Number of     Number of
  Relationship to Company               Amount         Shares       Warrants
  -----------------------             ---------      ---------     ---------
Chief Operating Officer,
Director                              $  57,750        825,000       825,000

CEO,Chariman of the Board of
Directors                                35,000        500,000       500,000

A company owned by Waddy
Stephenson, a Director                   17,500        250,000       250,000

President, CFO, Director                 26,250        375,000       375,000
                                      ---------      ---------     ---------
                                      $  84,000      1,200,000     1,200,000
                                      =========      =========     =========

During the nine months ended June 30, 2005, the Company's CEO and Chairman of
the Board of Directors, received a payment of $44,444 for finder's fees earned
by him for securing $2.0 million in financing for the Company in December 2002.
Also, the Company honored an indemnification agreement that it entered into with
the same party in June 2003 and paid the outstanding balance of $60,000.

During the nine months ended June 30, 2005, the Company paid to Measurable
Software Corporation , a company owned and controlled by a director, $10,881 in
fees for computer services and equipment.

NOTE 9: COMMITMENTS AND CONTINGENCIES

The Company conducts its operations utilizing leased facilities under
non-cancelable operating lease agreements for two years expiring on October 31,
2006. Future minimum lease commitments, excluding property taxes and insurance,
are approximately as follows:

Period ending December 31,

                      2005               $11,663
                      2006                19,790
                      Total              $31,453

                                       11
<PAGE>

The Company was served with a complaint in May 2004 filed in the Los Angeles
Superior Court, Central District, Case Number BC 316068, from an unrelated third
party asserting securities fraud, fraud, breach of contract and unfair business
practices against the Company and seeking damages of $65,000. The plaintiff
claims that she had loaned the Company the sum of $40,000 pursuant to a verbal
agreement and was promised repayment within 45 days plus a 25% profit. The funds
were utilized by the Company for a non-recourse advance which the Company was
unable to recover and the principal amount of this obligation is included in non
recourse loans payable-unrelated parties on the Company's balance sheet. The
Company has made offers to settle this matter and believes the ultimate outcome
will not have a material impact on the Company's financial condition. The
Company has accrued $25,000 as of June 30, 2005 as general and administrative
expenses for this potential claim.

The Company was served with a complaint in February 2004 filed with the Los
Angeles Superior Court, Northwest District, Case Number LC 067786, naming the
Company and a former director of the Company Harvey Bibicoff, as co-defendants
in a case against Old CFI claiming a breach of a promissory note by Old Case and
asserting fraud seeking damages of $140,000 plus attorneys fees and punitive
damages. The Company is defending this suit and believes the ultimate outcome
will not have a material impact on the Company's financial condition. The
Company has accrued $140,000 as of June 30, 2005 as general and administrative
expenses for this potential claim.

The Company was served with a complaint in October 2004 filed in the San Diego
Superior Court, North County District, Case Number GIN040080 from an attorney
who had represented the Company on a previous legal matter for contract, breach
of contract, common counts, imposition and foreclosure of attorneys' lien,
injunctive relief and declaratory relief seeking damages in the amount of
$31,741.32 for legal services rendered. The Company believes the amount sought
to be in excess of the fair value of the services rendered and is defending this
suit. The full amount of the claim asserted by the plaintiff in this matter has
been recorded in the Company's books as legal expense as of June 30, 2005.

On March 25, 2005 a derivative lawsuit was filed by a major stockholder and
secured lender of the Company. The lawsuit was filed in the Court of Chancery of
the State of Delaware against former officers and directors of the Company,
specifically Eric Alden, a former CEO and CFO and Chairman of the Board, Harvey
Bibicoff, a former interim CEO and CFO and director, Lorne Pollock, former Vice
President of Underwriting, Secretary and director and Gordon Gregory, a former
director alleging that these officers and directors had damaged the Company by
(a) engaging in self dealing transactions in breach of their fiduciary duty of
loyalty; (b) mismanaging the Company in violation of their oversight duties and
duty of care; (c) wasting corporate assets; and (d) making fraudulent
misrepresentations which induced the corporate entity to issue shares to these
individuals. The Company's Board of Directors has elected to consent to the
filing of this complaint. The Company was named as a nominal defendant in this
complaint. Management believes that the outcome of this case will not have a
material impact on the financial condition of the Company.

The Company is in default on all of its recourse debt obligations as described
in Notes 4 and 5.

NOTE 10: GOING CONCERN

The accompanying financial statements contemplate continuation of the Company as
a going concern. The Company has incurred net losses of $1,026,654 and
$1,512,452 during the nine months ended June 30, 2005 and 2004, respectively,
and anticipates continued losses for the current fiscal year. There was an
accumulated deficit of $13,470,812 as of June 30, 2005, total liabilities
exceeded total assets by $4,385,750 as of June 30, 2005, the Company has minimal
cash resources and new management has reduced its overhead to minimal levels
while evaluating whether the overall business model is sustainable or should be
discontinued so the Company can pursue a different business strategy. Those
conditions raise substantial doubt about the Company's ability to continue as a
going concern. The financial statements do not include any adjustments that
might result from the outcome of this uncertainty. In the report dated December
8, 2004 on the financial statements for the fiscal year ended September 30,
2004, the Company's independent auditors expressed substantial doubt about the
Company's ability to continue as a going concern.

NOTE 11:  LEGAL PROCEEDINGS

On March 25, 2005 a derivative lawsuit was filed by a major stockholder and
secured lender of the Company. The lawsuit was filed in the Court of Chancery of
the State of Delaware against former officers and directors of the Company,
specifically Eric Alden, a former CEO and CFO and Chairman of the Board, Harvey
Bibicoff, a former interim CEO and CFO and director, Lorne Pollock, former Vice
President of Underwriting, Secretary and director and Gordon Gregory, a former
director alleging that these officers and directors had damaged the Company by
(a) engaging in self dealing transactions in breach of their fiduciary duty of
loyalty; (b) mismanaging the Company in violation of their oversight duties and
duty of care; (c) wasting corporate assets; and (d) making fraudulent
misrepresentations which induced the corporate entity to issue shares to these
individuals. The Company's Board of Directors has elected to consent to the
filing of this complaint. The Company was named as a nominal defendant in this
complaint. Management believes that the outcome of this case will not have a
material impact on the financial condition of the Company.

                                       12
<PAGE>
The Company was served with a complaint in May 2004 filed in the Los Angeles
Superior Court, Central District, Case Number BC 316068, from an unrelated third
party asserting securities fraud, fraud, breach of contract and unfair business
practices against the Company and seeking damages of $65,000. The plaintiff
claims that she had loaned the Company the sum of $40,000 pursuant to a verbal
agreement and was promised repayment within 45 days plus a 25% profit. The funds
were utilized by the Company for a non-recourse advance which the Company was
unable to recover and the principal amount of this obligation is included in non
recourse loans payable-unrelated parties on the Company's balance sheet. The
Company has made offers to settle this matter and believes the ultimate outcome
will not have a material impact on the Company's financial condition. The
Company has accrued $25,000 as of June 30, 2005 as general and administrative
expenses for this potential claim.

The Company was served with a complaint in February 2004 filed in the Los
Angeles Superior Court, Northwest District, Case Number LC 067786, naming the
Company and Harvey Bibicoff, a former director of the Company, as co-defendants
in a case against Old CFI claiming a breach of a promissory note by Old Case and
asserting fraud seeking damages of $140,000 plus attorneys fees and punitive
damages. The Company is defending this suit and believes the ultimate outcome
will not have a material impact on the Company's financial condition. The
Company has accrued $140,000 as of June 30, 2005 as general and administrative
expenses for this potential claim.

The Company was served with a complaint in October 2004 filed in the San Diego
Superior Court, North County District, Case Number GIN040080 from an attorney
who had represented the Company on a previous legal matter for contract, breach
of contract, common counts, imposition and foreclosure of attorneys' lien,
injunctive relief and declaratory relief seeking damages in the amount of
$31,741.32 for legal services rendered. The Company believes the amount sought
to be in excess of the fair value of the services rendered and is defending this
suit. The full amount of the claim asserted by the plaintiff in this matter has
been recorded in the Company's books as legal expense as of June 30, 2005.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

The following discussion and analysis of our financial condition and results of
operations should be read in conjunction with our financial statements and the
related notes thereto appearing elsewhere herein.

FORWARD LOOKING STATEMENTS

The following "Management's Discussion and Analysis of Financial Condition and
Plan of Operation" includes "forward looking statements." All statements other
than statements of historical fact made in this Form 10Q-SB are forward-looking.
In particular, any statements made in this Form 10Q-SB regarding industry
prospects or our future results of operations or financial position are
forward-looking statements. Forward-looking statements reflect our current
expectations and are inherently uncertain. The forward-looking statements
contained herein are subject to a variety of risks and uncertainties, including
those discussed later under the heading "Factors That May Affect Future Results"
and elsewhere in this Quarterly Report on Form 10Q-SB that could cause actual
results to differ materially from those anticipated by us. Our actual results
may differ significantly from our expectations.

OVERVIEW

Case's business has been to provide pre-settlement and post-settlement
litigation funding services to attorneys (and, previously, plaintiffs) involved
in personal injury and other contingency litigation, conducted primarily within
the California courts.

Our funding services have included advances to attorneys and previously,
plaintiffs, which are non-recourse, meaning that the investment principal,
success fees and interest are repaid only when the case is settled or favorably
adjudicated in court. These investments are collateralized solely by the
potential proceeds of underlying litigation. We record such advances as
investments in contracts.

Since the reverse acquisition in March 2002, we have incurred operating losses
in every quarter, net losses have exceeded $7,000,000. In February 2004, we
appointed Harvey Bibicoff interim Chief Executive Officer and interim Chief
Financial Officer and accepted the resignation of Eric Alden as Chief Executive
Officer and Chief Financial Officer. Also in February 2004, we appointed a new
Chairman of the Board of Directors and three other new directors were appointed
replacing two director positions previously held by members of management and
filling a vacant position. In March 2004, in conjunction with the foregoing
changes we implemented with respect to our senior management and our Board of
Directors, we obtained a secured short term bridge loan from the Canadian
Commercial Workers Industrial Pension Plan ("CCWIPP") and obtained deferrals on
other debt obligations while we sought additional capital which we were unable
to obtain. In June 2004, the Board of Directors appointed a new Chief Executive
Officer and Chief Financial Officer to develop a new strategy for our litigation
financing business as well as assist us in our efforts to raise additional
capital.

On October 7, 2004, five of our six directors resigned including the Chairman
and our recently appointed CEO and CFO who also resigned his positions as CEO,
CFO. At the same Board of Directors meeting, four new directors were appointed
to fill all but one of the seats to be vacated. Effective as of the adjournment
of the meeting, Michael Schaffer, previously Chairman of the Board and Chief
Executive Officer of our Company from April 1994 to March 2002, was elected as
the new Chairman of the Board of Directors. At a second Board of Directors
meeting several days later, Michael Schaffer was appointed Chief Executive
Officer and newly appointed director Lawrence Schaffer was appointed Chief
Financial Officer and President; newly appointed director William Rapaglia was
appointed Chief Operating Officer; and newly appointed director Waddy Stephenson
as Corporate Secretary.

                                       13
<PAGE>

The new Board of Directors and management is conducting a full investigation of
the finances of Case over the past several years, as well as evaluating the
viability of our litigation financing business and, if determined not viable,
seek out new business opportunities.

In November of 2004 we received a letter from a law firm representing a large
shareholder and secured creditor, demanding the Company undertake an
investigation into, among other things the asserted negligence of certain
officers and directors. In March 2005, with the new Board of Directors consent,
this same large shareholder and secured creditor filed a derivative lawsuit
alleging that prior officers and directors had damaged us by (a) engaging in
self dealing transactions in breach of their fiduciary duty of loyalty; (b)
mismanagement in violation of their oversight duties and duty of care; (c)
wasting corporate assets; and (d) making fraudulent misrepresentations which
induced the corporate entity to issue shares to these individuals.

REVENUE GENERATION, RECOGNITION, AND RESERVE FOR CONTRACT LOSSES

The majority of our advances, loans and guaranties are risk-based investments in
contracts subject to the uncertainty of future events in the prosecution of the
underlying litigation. We charge success fees which are recognized only at
conclusion of the case, and only if such litigation is successful. We establish
an allowance for investments in contracts that may become uncollectible. It is
maintained at a level, which in our judgment is sufficient to cover future
losses. The amount of the allowance is based on trends in historical loss
experience, and exceeds the amount experienced on resolved cases.

Contract Fees - There are two categories of Contract Fees: i) fees generated
from the resolution of successful cases and through the Short Term Loan Program
funded entirely by us, and ii) fees generated from the resolution of successful
cases and through the Short Term Loan Program arranged and serviced by us, but
funded by third parties, referred to herein as "Third Party Investments."

We utilized Third Party Investments in order to provide funding in situations
when our available internal capital was insufficient to fund the transactions
entirely by ourselves, or when the size of the transaction is larger than was
prudent for us to undertake directly. We receive a success fee for servicing the
investment, generally equal to 25% to 50% of the income, if any, received upon
successful resolution of the underlying case. The third party investors bear the
entire financial risk with respect to the underlying investment in the contract.
In addition, if we also participated in the funding, we share in the remaining
fees and principal with the third party investors according to our pro-rata
share of the total capital invested.

CRITICAL ACCOUNTING POLICIES

Revenue recognition:

Contract fee income from investments in contracts is recognized once collection
is assured, usually upon receipt of cash after a case is successfully settled or
favorably adjudicated. Selling commissions are incurred and expensed when the
contract investments are funded. An investment in a contract is deemed fully or
partially uncollectible when the case is dismissed, abandoned or settled for an
amount less than the amount invested.

In addition to contract fees from investments in contracts made by us, we made
service fees from investments in contracts on behalf of third party investors
for which we receive a success fee equal to 25% to 50% of the income generated
upon successful resolution of the underlying case. These third party investments
are collateralized by specifically identified investments in contracts and are
repayable only upon successful resolution and collection of the underlying case,
along with fees equal to 50% to 75% of the amount earned. Contract fees are
presented net of amounts paid to third party participants.

We have established an allowance for investments in contracts that may become
uncollectible. The allowance for contract investment losses is maintained at a
level, which in our judgment is adequate to absorb losses in the contract
investment portfolios.

TRENDS AND UNCERTAINTIES

The principal uncertainties we face are access to adequate capital to either
rebuild our litigation finance business with significant modifications or seek
other business opportunities.

RESULTS OF OPERATIONS

Results of operations for the three and nine months ended June 30, 2005 compared
with the three and nine months ended June 30, 2004.

REVENUES:

Revenues consist primarily of fees earned on investments in contracts, which are
recognized upon receipt when the case is settled or favorably adjudicated.
Consequently, contract fee revenue is a function of the size and maturity of the
investment portfolio. In addition, subsequent to the reverse acquisition, the
Company manages the investments in contract portfolios of affiliates and earns a
15% service fee based upon the gross amount collected on behalf of such
affiliates when the underlying case is settled or favorably adjudicated, and the
payment has been received.

                                       14
<PAGE>

TOTAL REVENUE

Total revenues consisting of contract fees and service fees aggregated $7,125
for the three months ended June 30, 2005 compared with $211,552 for the three
months ended June 30, 2004, a decrease of $204,427 or 96.6%. Total revenues
aggregated $82,543 for the nine months ended June 30, 2005 compared with total
revenues of $542,910 for the nine months ended June 30, 2004, a decrease of
$460,366 or 84.8%.

CONTRACT FEES

There were no contract fee revenues for the three months ended June 30, 2005
compared with $191,535 for the three months ended June 30, 2004, a decrease of
$191,535 or 100%. For the nine months ended June 30, 2005 and 2004, contract fee
revenues were $71,027 and $499,369 respectively, a decrease of $428,342 or
85.8%.

The decrease in contract fee revenues for the three and nine months ended June
30, 2005 is attributable to receiving partial payments which were applied to
principal first. In addition, the remaining portfolio of cases represents the
most problematic cases with the lowest likelihood of successful resolution.
Accordingly, we have reserved 100% of at risk principal as an allowance for
contract losses excluding investments acquired after January 1 , 2005.

SERVICE FEES

Service fee revenues were $7,125 for the three months ended June 30, 2005
compared with $20,017 for the three months ended June 30, 2004, a decrease of
$12,892 or 64.4%. For the nine months ended June 30, 2005 and 2004, service fee
revenues were $11,517 and $43,541 respectively, a decrease of $32,024 or 73.6%.

Service fees are based upon collections from the portfolios of Old CFI and Case
Financial Funding, Inc. under management by us and are anticipated continuing
their decline as this portfolio matures.

OPERATING COSTS AND EXPENSES:

Operating costs and expenses consist of provision for losses on investments in
contracts, general and administrative expenses, and sales and marketing
expenses.

PROVISION FOR LOSSES ON INVESTMENTS IN CONTRACTS

Fee income is recognized upon receipt when a case is settled or favorably
adjudicated. An investment in a contract is deemed fully or partially
uncollectible when the case is dismissed or settled for an amount less than the
Company's investment. The Company has established an allowance for investments
in contracts for contracts that may become uncollectible.

The allowance for contract losses for both loans receivable and investments in
contracts had been increased to an amount equal to the principal and accrued
revenue balances outstanding as of June 30, 2005 on all uncollected non third
party funded loans receivable and investments in contracts funded prior to
October 2004. As a result, there will be no further provision for losses on
investment in contracts recognized in future periods unless new loans or
investments are initiated by us. On February 28, 2005, we purchased a 65.63%
interest in the remaining case portfolio of Case Financial Funding, Inc, a
subsidiary of Old Case ("CFF"), by acquiring 65.63% of the secured notes issued
by CFF that provide the holder with a secured interest in the proceeds of the
outstanding cases of CFF. Based upon our evaluation, we have not recorded any
allowance for contract losses applicable to this portfolio.

GENERAL AND ADMINISTRATIVE

General and administrative costs and expenses were $141,251 for the three months
ended June 30, 2005 as compared with $358,972 for the three months ended June
30, 2004. Accordingly, general and administrative expenses decreased by $217,721
or 60.6% for the three months ended June 30, 2005 as compared with the three
months ended June 30, 2004. For the nine months ended June 30, 2005 and 2004,
general and administrative costs were $599,139 and $1,119,144, respectively, a
decrease of $520,006 or 46.5%.

The decrease in general and administrative costs and expenses for the nine
months ended June 30, 2005 as compared with the nine months ended June 30, 2004
is primarily attributable to the decrease in administrative overhead costs in
conjunction with our change in management in October 2004. At that time, we
terminated all employees except for our CEO, CFO and a bookkeeper as well as
relocated to less expensive office facilities which minimized general and
administrative costs while we evaluate our future plans.

SALES AND MARKETING

There were no sales and marketing expenses for the three months ended June 30,
2005 as compared with $46,932 for the three months ended June 30, 2004.
Accordingly, sales and marketing expenses decreased $46,932 or 100% for the
three months ended June 30, 2005 as compared with the three months ended June
30, 2004. For the nine months ended June 30, 2005 and 2004, sales and marketing
expenses were $3,542 and $188,270, respectively, a decrease of $184,728 or
98.1%. The decrease was a result of the termination of sales and marketing
personnel which is now being handled by existing officers and employees and we
are not presently seeking new opportunities in litigation financing until we
have determined that we will continue to pursue this business segment.

                                       15
<PAGE>
OTHER INCOME (EXPENSE):

INTEREST EXPENSE

Interest expense was $107,502 for the three months ended June 30, 2005, as
compared with $104,358 during the three months ended June 30, 2004. Accordingly,
interest expense increased by $3,145 for the three months ended June 30, 2005 as
compared with the three months ended June 30, 2004. For the nine months ended
June 30, 2005 and 2004, interest expense was $314,836 and $283,579,
respectively, an increase of $31,257.

NON-CASH FINANCE EXPENSE

Non-cash finance expenses were $50,670 for the three months ended June 30, 2005,
as compared with $296,804 during the three months ended June 30, 2004.
Accordingly, non-cash finance expenses decreased $246,134 for the three months
ended June 30, 2005as compared with the three months ended June 30, 2004. For
the nine months ended June 30, 2005 and 2004, non-cash finance expenses were
$158,573 and $390,169, respectively, a decrease of $231,595.

Non-cash finance expenses represent amortized costs of common stock, options and
warrants granted in conjunction with financing transactions. The amortization of
costs associated with the booking of the 1.0 million shares of stocks granted to
a holder of $2.0M note ended in September 2004. It explains the decrease in non
cash finance charges for the three and nine months ended June 30, 2005.

COMMITMENTS

Other than as described in Note 9 to our financial statements, we have no other
material off balance sheet arrangements.

LIQUIDITY AND CAPITAL RESOURCES:

Our independent auditors have indicated in their report dated December 8, 2004
for the year ended ended September, 2004 that there is substantial doubt about
our ability to continue as a going concern. We have been experiencing cash flow
problems and new management is evaluating whether the overall business model is
sustainable or should be discontinued so we can pursue a different business
strategy. Those conditions raise substantial doubt about our ability to continue
as a going concern. The financial statements do not include any adjustments that
might result from the outcome of this uncertainty. Further, we are actively
seeking additional capital which may result in significant and substantial
dilution to existing shareholders.

Our balance sheet at June 30, 2005 reflects cash of $105,659, a decrease of
$77,227 for the nine months then ended as compared with cash of $182,886 in the
nine months ended June 30, 2004. Net cash used in operating activities was
$682,641 for the nine months ended June 30, 2005 and $750,314 for the nine
months ended June 30, 2004. Net cash used in operating activities is due
primarily to our losses from operations, which remained constant for the nine
months ended June 30, 2005 as compared to the same period a year earlier due
primarily to significant decreases in revenues for the nine months ended June
30, 2005 offset by similar decreases in operating expenses instituted by new
management.

Net cash provided from investing activities was $ 756,712 for the nine months
ended June 30, 2005 as compared to net cash used in investing activities of
$63,561 for the nine months ended June 30, 2004. The increase in cash provided
from investing activities is due primarily to our efforts to liquidate the
current portfolio resulting in collections of $603,567 in loans receivable and
$156,026 in investments in contracts.

Net cash used in financing activities was $1,795 for the nine months ended June
30, 2005 as compared with $804,110 in net cash provided from financing
activities for the nine months ended June 30, 2004. Net cash provided consisted
of $490,000 in proceeds from a private placement of 7,000,000 shares of common
stock pursuant to Rule 506 of Regulation D of the Securities Act of 1933 (the
"Offering"). The Offering consisted of 14 units each including 500,000 shares of
common stock at a purchase price of $0.07 per share together with a warrant to
purchase an additional 500,000 shares of common stock at $0.10 per share. The
warrant shall expire two years from the date of issue. In addition, during the
nine months ended June 30, 2005, the Company borrowed $70,000 from one related
party. The foregoing cash provided was offset by a decrease in our obligations
under 3rd party investments of $562,432 resulting from our collections of
outstanding loans receivable and investments in contracts as follows:

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<PAGE>

                                                   Unrelated
                                Related Party       Parties            Total
                                 -----------      -----------      -----------
Balance at October 1, 2004       $ 2,048,832      $   281,022      $ 2,329,854

New 3rd party advances                     0                0                0

Adjustments                           (3,935)            (257)          (4,192)

Repayments                          (560,216)          (2,216)        (562,432)
                                 -----------      -----------      -----------

Balance at March 31, 2005        $ 1,484,681     $   278,549      $ 1,763,230
                                 ===========      ===========      ===========



Our capital expenditures for the nine months ended June 30, 2005 totaled $2,881.

FACTORS THAT MAY AFFECT FUTURE RESULTS

Our independent auditors have expressed doubt about our ability to continue as a
going concern, which may hinder our ability to obtain future financing.

In their report dated December 8, 2004 for the year ended September 30, 2004,
our independent auditors have expressed doubt about our ability to continue as a
going concern. Our ability to continue as a going concern is a result of
recurring losses from operations, a stockholders' deficit, and requirement for a
significant amount of capital financing to proceed with our business plan. Our
ability to continue as a going concern is subject to our ability to generate a
profit and/or obtain necessary funding from outside sources, including obtaining
additional funding from the sale of our securities, increasing sales or
obtaining loans where possible. The going concern uncertainty in the auditor's
report increases the difficulty in meeting such goals and there can be no
assurances that such methods will prove successful.

The Company's results may be volatile due to the uncertainty of litigation
outcomes

The Company's business is dependent on litigation outcomes and the judgments
rendered in connection with such outcomes and settlements of claims. Settlements
are in turn dependent upon perceived probabilities of litigation outcomes and
the attending judgments. However, litigation entails greater or lesser degrees
of uncertainty. Such uncertainties include uncertainty as to the assessment of
the credibility of witnesses, the trier of fact's perception of counsel, the
assessment of fault, the legal nature of the claim and the amount of damages.
Although the Company seeks to weigh such uncertainties when it makes the
underwriting decision, there can be no assurance that the outcome of any given
litigated claim will be as predicted whether or not the probabilities were
correctly assessed. The vagaries of litigation may result in judgments against
the Company's interests, settlements for lower amounts than predicted, or
failures to reach settlements. Although the Company maintains reserves for
contract losses which management believes are adequate, such outcomes would have
a negative impact on the Company's business, prospects and results of
operations.

The Company's inability to collect upon judgment, on a timely basis or at all,
will have a negative impact on its business

The Company may not be able to collect upon the judgment recovery when and if it
is paid to the plaintiff, or the Company may not be able to collect without
bringing a legal action against the former plaintiff. Either event, the failure
to collect or the necessity of legal action to collect can have an adverse
impact on the Company's business, prospects and results of operations.

Company common stock is listed on the Over-The-Counter (OTC) Bulletin Board,
which may make it more difficult for stockholders to sell their shares and may
cause the market price of Company common stock to decrease.

Because the Company's common stock is listed on the OTC Bulletin Board, the
liquidity of the common stock is impaired, not only in the number of shares that
are bought and sold, but also through delays in the timing of transactions, and
limited coverage by security analysts and the news media, if any, of the
Company. As a result, prices for shares of the Company's common stock may be
lower than might otherwise prevail if the Company's common stock was traded on
NASDAQ or a national securities exchange, like the American Stock Exchange.

The Company's stock price may be volatile and an investment in such common stock
could suffer a decline in value.

The market price of the Company's common stock may fluctuate significantly in
response to a number of factors, some of which are beyond the Company's control.
These factors include:

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<PAGE>

o     government regulatory action affecting the Company's services or
      competitors' services;

o     actual or anticipated fluctuations in operating results;

o     the loss of key management or other personnel;

o     the loss of major customers;

o     the outcome of any future litigation;

o     broad market fluctuations; and

o     economic conditions in the United States or abroad.

The Company's charter documents and Delaware law may have the effect of making
it more expensive or more difficult for a third party to acquire, or to acquire
control, of the Company.

The Company's certificate of incorporation makes it possible for the Company's
Board of Directors to issue preferred stock with voting or other rights that
could impede the success of any attempt to change control of the Company.
Delaware Law prohibits a publicly held Delaware corporation from engaging in
certain business combinations with certain persons, who acquire the Company's
securities with the intent of engaging in a business combination, unless the
proposed transaction is approved in a prescribed manner. This provision has the
effect of discouraging transactions not approved by the Company's Board of
Directors as required by the statute which may discourage third parties from
attempting to acquire or to acquire control of the Company even if the attempt
would result in a premium over market price for the shares of common stock held
by the Company's stockholders.

ITEM 3. CONTROLS AND PROCEDURES

The Company's management with the participation of principal executive and
financial officers evaluated the effectiveness of the Company's disclosure
controls and procedures as defined by Rule 13a-15(e) of the Exchange Act as of
the end of the period covered by this report. The Company's disclosure controls
and procedures are designed to ensure that information required to be disclosed
by the Company in reports it files or submits under the Exchange Act are
recorded, processed, summarized and reported on a timely basis. Based upon their
evaluation, the Company's principal executive and financial officer concluded
that the Company's disclosure controls and procedures are effective to
accumulate and communicate to the Company's management as appropriate to allow
timely decisions regarding disclosure.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

On March 25, 2005 a derivative lawsuit was filed by a major stockholder and
secured lender of the Company. The lawsuit was filed in the Court of Chancery of
the State of Delaware against former officers and directors of the Company,
specifically Eric Alden, a former CEO and CFO and Chairman of the Board, Harvey
Bibicoff, a former interim CEO and CFO and director, Lorne Pollock, former Vice
President of Underwriting, Secretary and director and Gordon Gregory, a former
director alleging that these officers and directors had damaged the Company by
(a) engaging in self dealing transactions in breach of their fiduciary duty of
loyalty; (b) mismanaging the Company in violation of their oversight duties and
duty of care; (c) wasting corporate assets; and (d) making fraudulent
misrepresentations which induced the corporate entity to issue shares to these
individuals. The Company's Board of Directors has elected to consent to the
filing of this complaint. The Company was named as a nominal defendant in this
complaint. Management believes that the outcome of this case will not have a
material impact on the financial condition of the Company.

The Company was served with a complaint in May 2004 filed in the Los Angeles
Superior Court, Central District, Case Number BC 316068, from an unrelated third
party asserting securities fraud, fraud, breach of contract and unfair business
practices against the Company and seeking damages of $65,000. The plaintiff
claims that she had loaned the Company the sum of $40,000 pursuant to a verbal
agreement and was promised repayment within 45 days plus a 25% profit. The funds
were utilized by the Company for a non-recourse advance which the Company was
unable to recover and the principal amount of this obligation is included in non
recourse loans payable-unrelated parties on the Company's balance sheet. The
Company has made offers to settle this matter and believes the ultimate outcome
will not have a material impact on the Company's financial condition. The
Company has accrued $25,000 as of June 30, 2005 as general and administrative
expenses for this potential claim.

The Company was served with a complaint in February 2004 filed in the Los
Angeles Superior Court, Northwest District, Case Number LC 067786, naming the
Company and Harvey Bibicoff, a former director of the Company, as co-defendants
in a case against Old CFI claiming a breach of a promissory note by Old Case and
asserting fraud seeking damages of $140,000 plus attorneys fees and punitive
damages. The Company is defending this suit and believes the ultimate outcome
will not have a material impact on the Company's financial condition. The
Company has accrued $140,000 as of June 30, 2005 as general and administrative
expenses for this potential claim.

                                       18
<PAGE>
The Company was served with a complaint in October 2004 filed in the San Diego
Superior Court, North County District, Case Number GIN040080 from an attorney
who had represented the Company on a previous legal matter for contract, breach
of contract, common counts, imposition and foreclosure of attorneys' lien,
injunctive relief and declaratory relief seeking damages in the amount of
$31,741.32 for legal services rendered. The Company believes the amount sought
to be in excess of the fair value of the services rendered and is defending this
suit. The full amount of the claim asserted by the plaintiff in this matter has
been recorded in the Company's books as legal expense as of June 30, 2005.

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

On February 28, 2005, the Company purchased a 65.63% interest in the remaining
case portfolio of Case Financial Funding, Inc, a subsidiary of Old Case ("CFF"),
by acquiring 65.63% of the secured notes issued by CFF that provide the holder
with secured interest in the proceeds of the outstanding cases of CFF. As
consideration for this purchase, the Company issued a convertible debenture in
the amount $287,000. The principal amount of the debenture is due and payable in
full two years from the date of issue unless converted into common stock of the
Company at a conversion price of $0.15 per share. The Company has the right at
anytime, after one year, to require conversion of the debenture into shares of
common stock at 15 cents per share, provided that: the stock at anytime trades
at 30 cents or higher for a consecutive period of 30 trading days. Interest is
payable semi-annually at a rate of 5% per annum.

During the nine months ended June 30, 2005, the Company issued 7,000,000 shares
of common stock in a private placement issued pursuant to Rule 506 of Regulation
D of the Securities Act of 1933 (the "Offering"). The Offering consisted of 14
units each including 500,000 shares of the Company's common stock at a purchase
price of $0.07 per share together with a warrant to purchase an additional
500,000 shares of the Company's common stock at $0.10 per share. The warrant
shall expire two years from the date of issue. After one year from date of
issue, if the Company's common stock closing price exceeds $0.20 per share for a
continuous 30 day period, the holder of the warrant shall have 45 days from the
end of such 30 day period to exercise. The gross proceeds received for this
offering were $490,000 and the Company recognized no expenses directly
associated with this transaction.

ITEM 3. DEFAULTS IN SENIOR SECURITIES.

As of June 30, 2005, the Company is in default on the following notes:

(a) A $2,000,000 note payable to a major stockholder, uncollateralized, with
interest payable monthly at 12.0% per annum, due December 12, 2006. The Company
is in default on this loan and, as of June 30, 2005, accrued interest totaled
$339,288.

(b) A $500,000 secured note payable from a major shareholder, secured by a lien
on all assets of the Company, interest payable monthly at 12.0% per annum, due
September 8, 2004. The Company is in default on this loan and, as of June 30,
2005, accrued interest totaled $78,833.

(c) In May 2002 in conjunction with the acquisition of Case Financial LLC, the
Company assumed $700,000 in unsecured promissory notes, bearing interest at 8%,
which, at the time assumed were payable to two related-party stockholders. The
first note for $600,000, which was due in May 2004, was to Harvey Bibicoff, a
former director and former interim CEO and CFO of the Company. On March 30,
2004, Mr. Bibicoff agreed to a six month deferral on interest payments
commencing with the interest payment that had been due for March 2004 and a
deferral of the principal payment to December 31, 2004. In addition, he agreed
to a suspension of any collection actions for any prior defaults under this
note. The second note, for $100,000, was to a relative of Eric Alden, the
Company's former CEO. As of June 7, 2004, the Company entered into an agreement
and mutual release with Eric Alden which included provisions for this former
officer, director and shareholder to divest of the majority of his shares of the
Company's common stock. The new management, which assumed control as of October
7, 2004 is investigating the adequacy of the consideration and the legal
validity of the release. The noteholder has informed the Company that this
$100,000 note was due May 2004. The Company is investigating this matter. The
Company is in default on both of these notes due to non payment of interest (and
principal, in the case of the $600,000 note) and, as of June 30, 2005, total
accrued interest on the $600,000 totaled $76,000.

(d) Effective January 1, 2003, an accredited investor, converted an investment
in the Company by exchanging a four year, 9.85% per annum promissory note for a
four year, 12% per annum promissory note issued by the Company. The principal
amount of the promissory note was $150,000. As part of the conversion, the
Company cancelled four year warrants to purchase 75,000 shares of common stock
at $0.60 per share, and issued four year warrants to purchase: (i) 150,000
shares of common stock at an exercise price of $0.50 and (ii) 75,000 shares of
common stock at an exercise price of $0.80. The Company also agreed to register
the common stock underlying the warrants for resale. On March 30, 2004, in
conjunction with changes the Company implemented with respect to its senior
management and its Board of Directors, the lender agreed to a deferral on
interest payments under this note and a suspension of any collection actions for
prior defaults under this note, commencing with the payment that had been due
for January 2004 for a period of six months. In consideration of this deferral,
the Company agreed to reduce the exercise price on warrants to purchase 75,000
shares of the common stock of the Company at $0.80 to a revised exercise price
of $0.50 per share. All other terms of the warrants remain unchanged. The
increase in the fair value of the foregoing warrants as a result of the
reduction in the exercise price as well as the initial value are being amortized
over the remaining life of the warrants and charged to non-cash finance expense.
The Company is in default on this note due to non payment of interest and, as of
June 30, 2005, total accrued interest totaled $27,000.

                                       19
<PAGE>
(e) The Company had outstanding as of March 31, 2005, $140,000 in unsecured
promissory demand notes ($40,000 at an interest rate of 12% per annum,$75,000 at
an interest rate of 12% per annum and $25,000 at an interest rate of 12% per
annum), all to former directors. The holders of these demand notes agreed to a
deferral on interest payments and the principal payment commencing with the
interest payment due March 2004 for a period of six months. The Company is in
default on these notes due to non payment of interest and, as of June 30, 2005,
total accrued interest totaled $28,499.

(f) The Company had outstanding as of June 30, 2005, $120,000 in unsecured
promissory demand notes to the former CEO and a relative of the former CEO which
bear interest at 12%. The Company is in default on these notes due to non
payment of interest and, as of June 30, 2005, accrued interest totaled $21,340.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

None

ITEM 5. OTHER INFORMATION.

None

ITEM 6. EXHIBITS

The following documents are filed as part of this report:

31.1 Certification of Chief Executive Officer Pursuant to the Securities
Exchange Act of 1934, Rules 13a-14 and 15d-14, as adopted pursuant to Section
302 of the Sarbanes-Oxley Act of 2002

31.2 Certification of Chief Financial Officer Pursuant to the Securities
Exchange Act of 1934, Rules 13a-14 and 15d-14, as adopted pursuant to Section
302 of the Sarbanes-Oxley Act of 2002

32. Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002

                                   SIGNATURES

In accordance with the requirements of the Securities Exchange Act of 1934, the
Registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

CASE FINANCIAL, INC.

                  By: /s/ Michael Schaffer
                      -----------------------
                      Chief Executive Officer
                      Date: August 15, 2005

                  By: /s/ Lawrence Schaffer
                      -----------------------
                      Chief Financial Officer
                      Date: August 15, 2005

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