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 December 31, 2004

                                       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 February 1, 2005 there were 17,019,236 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                                       19

                           PART II - OTHER INFORMATION


Item 1.        LEGAL PROCEEDINGS                                             19

Item 5.        OTHER INFORMATION                                             19

Item 6.        EXHIBITS                                                      19

SIGNATURES                                                                   21
<PAGE>

ITEM 1. INTERIM FINANCIAL STATEMENTS

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                           Consolidated Balance Sheet
                                   (Unaudited)

<TABLE>
<CAPTION>

                                                                    December 31, 2004

<S>                                                                <C>
ASSETS

Cash & cash equivalents                                               $    115,139

Investments in contracts - net of allowance for contract losses of
$462,737                                                                 1,587,641

Loans receivable - net of allowance for bad debts of $99,851               377,865

Prepayments and other assets                                               259,406
Equipment, at cost, net of accumulated depreciation of $171,730             13,805
                                                                      ------------
      TOTAL ASSETS                                                    $  2,353,856
                                                                      ============

LIABILITIES AND STOCKHOLDERS' DEFICIENCY

Accounts payable and accrued expenses                                 $    970,207

Non-recourse loans payable - related parties                             1,676,535

Non-recourse loans payable                                                 279,522

Loans payable - related parties                                          3,460,000

Loans payable                                                              270,000
                                                                      ------------
      TOTAL LIABILITIES                                                  6,656,264
                                                                      ------------
STOCKHOLDERS' DEFICIENCY

Common stock, par value $0.001 per share,

100,000,000 shares authorized, 17,019,236 shares issued and
 outstanding at December 31, 2004                                           17,019

Paid-in-capital                                                          8,504,041

Accumulated deficit                                                    (12,823,468)
                                                                      ------------
      TOTAL STOCKHOLDERS'  DEFICIENCY                                   (4,302,408)
                                                                      ------------
      TOTAL LIABILITIES AND
           STOCKHOLDERS' DEFICIENCY                                   $  2,353,856
                                                                      ============

</TABLE>


See accompanying notes to consolidated financial statements.


                                       2
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                      Consolidated Statements of Operations
                                   (unaudited)

<TABLE>
<CAPTION>

                                                             Three month Periods   Three month Periods
                                                             ended December 31,    ended December 31,
                                                             2004                  2003
                                                             -------------------   -------------------

<S>                                                         <C>                   <C>
REVENUE

      Contract fees                                          $     33,403              153,826
      Service fees, related parties                                 2,592               11,845
                                                             ------------          ------------
            TOTAL REVENUE                                          35,994              165,671

OPERATING EXPENSES

      Provision for losses on investments in contracts                 --               (8,791)
      Provision for impairment of notes and other
      receivables from affiliate                                       --               (8,911)
      General and administrative                                  250,232              360,202

      Sales and marketing                                           3,542               84,062
         TOTAL OPERATING EXPENSES                                 253,773              426,562
                                                             ------------         ------------
      LOSS FROM OPERATIONS                                       (217,779)            (260,891)

OTHER INCOME (EXPENSE)

      Interest income                                                 290                    2
      Interest expense                                           (107,702)            (111,157)
      Non-cash finance expenses                                   (54,119)
      Miscellaneous Income                                             --                1,000
                                                             ------------         ------------

         TOTAL OTHER EXPENSE                                     (161,531)            (110,155)
                                                             ------------         ------------

      NET LOSS                                               $   (379,310)        $   (371,046)
                                                             ============         ============

      Net loss per common share - basic and diluted                  (.02)                (.02)
                                                             ============         ============

      Weighted average number of common shares                 17,019,236           15,561,108
                                                             ============         ============
</TABLE>

See accompanying notes to consolidated financial statements.


                                       3
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
                      Consolidated Statements of Cash Flows
                                   (unaudited)

<TABLE>
<CAPTION>

                                                                            Three month Periods          Three month Periods
                                                                            ended December 31, 2004      ended December 31, 2003
                                                                            ------------------------   ------------------------

<S>                                                                         <C>                        <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss                                                                           $(379,310)                $(371,046)
Adjustments to reconcile net loss to net cash used in operating activities:
      Depreciation                                                                     6,266                    11,988
      Amortization of debt premium                                                    18,957                    18,957
      Provision for losses on investments in contracts                                    --                    (8,791)
      Impairment of notes receivable of affiliate                                         --                    (8,911)
      Amortization of warrants issued with debt                                       27,432                        --
      Common stock and options for compensation                                           --                    41,493
       Decrease in prepayments and other assets                                          347                    30,748
       Increase in accounts payable and other liabilities                            120,172                    68,718
       Net cash used in operating activities                                        (206,137)                 (216,844)
                                                                                   ---------                  ---------

CASH FLOWS FROM INVESTING ACTIVITIES:
     Investment in contracts  -- advances and loans                                       --                 (331,656)
     Investment in contracts  -- collections                                         177,526                  187,780
     Increase in loans receivable-advances                                                --                 (369,500)
     Decrease in loans receivable - collections                                      413,314                  325,000
                                                                                   ---------                 --------
      Net cash provided by (used in) investing activities                            590,840                 (188,376)
                                                                                   ---------                 --------

CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from borrowings                                                                --                  351,071
  Repayments of borrowings                                                            (1,500)                (145,000)
  Proceeds from related party borrowings                                              70,850                  351,500
  Repayments of related party borrowings                                            (372,297)                (315,938)
                                                                                   ---------                 ---------
   Net cash provided by (used in) financing activities                              (302,947)                 241,633
                                                                                   ---------                 ---------
NET INCREASE (DECREASE) IN CASH
                                                                                      81,756                 (163,587)

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

CASH AND CASH EQUIVALENTS  - END OF PERIOD                                         $ 115,139                $  29,064
                                                                                   =========                =========

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
  Cash paid during the three month period for:
   Interest                                                                        $     981                $  57,158
                                                                                   =========                =========
   Income taxes                                                                    $      25                $      --
                                                                                   =========                =========

</TABLE>

See accompanying notes to consolidated financial statements.


                                       4
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
              Notes to Unaudited Consolidated Financial Statements
                  For the three months ended December 31, 2004

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 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. In order to continue to
generate revenues, the Company had increased its reliance upon third party
investors to provide non recourse funding for its loan programs. The new Board
of Directors and management is conducting a full investigation of the finances
of the Company over the past several years, as well as evaluating the viability
of its litigation financing business and, if determined not viable, seek out new
business 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 months ended December 31, 2004 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 months ended December 31, 2004

The Company has established an allowance for investments in contracts and loans
receivable that may become uncollectible. Theses 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.

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 17,019,236 and
15,561,108 for the years ended December 31, 2004 and 2003, respectively. The
weighted average number of common shares outstanding does not include 6,410,833
and 8,990,000 options and warrants outstanding at December 31, 2004 and 2003,
respectively, because they are antidilutive.

Customer Concentrations

As of December 31, 2004, one law firm customer represented approximately 58% of
the portfolio of investments in contracts and loans receivable. For the three
months ended December 31, 2004, two other law firms represented approximately
45% and 29% respectively of the total revenue for the period.

NOTE 2: INVESTMENTS IN CONTRACTS

At December 31, 2004, investments in contracts, net of allowance for contract
losses of $462,737, were $ 1,587,641. Management reviews each case prior to
making an advance.

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.


                                       6
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
              Notes to Unaudited Consolidated Financial Statements
                  For the three months ended December 31, 2004

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 months ended December 31, 2004 is as follows:


               Balance - October 1, 2004            $ 2,227,904

               New advances                                   0
               Collections                             (177,526)
               Write-offs due to uncollectibility             0
                                                    -----------
               Balance - December 31, 2004          $ 2,050,378
                                                    ===========

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 December 31, 2004 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 month Periods ended
                                                  December 31, 2004
                                                  -----------------
                 Balance at beginning of period       $462,737
                 Increases to the allowances                 0
                 Write-offs due to uncollectibility          0
                                                      --------
                 Balance at end of period             $462,737
                                                      ========



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 months ended December 31, 2004 is as follows:

                    Balance - October 1, 2004     $ 891,031

                    New loans                             0
                    Repayments                     (413,315)
                                                  ---------
                    Balance - December 31, 2004   $ 477,716
                                                  =========

Included in loans receivable as of December 31, 2004 is $356,453 in loans to a
single law firm for a group of similar cases, $286,453 of which have been funded
through third party investments. In addition, as of December 31, 2004, the
Company had accrued revenue to accounts receivable of $206,338 on these cases
and collected $167,276 for the quarter ended December 31, 2004. 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 December 31, 2004 representing 100% of uncollected principal and accrued
fees still outstanding.


                                       7
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
              Notes to Unaudited Consolidated Financial Statements
                  For the three months ended December 31, 2004

NOTE 4: LOANS PAYABLE, RELATED PARTIES

As of December 31, 2004, 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.                                                            $  1,676,535

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
                                                                                     ------------
                                                                                     $  5,136,535
                                                                                     ============

</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 December 31, 2004, total accrued interest totaled
$220,274.

(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 December 31, 2004 of $450,000 to
non-cash finance expense. The Company is in default on this loan and, as of
December 31, 2004, total accrued interest totaled $48,833.

(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
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


                                       8
<PAGE>

                      CASE FINANCIAL, INC. AND SUBSIDIARIES
              Notes to Unaudited Consolidated Financial Statements
                  For the three months ended December 31, 2004

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 December 31, 2004, total accrued
interest on the $600,000 totaled $52,000.

(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
December 31, 2004, total accrued interest totaled $18,000.00.

(5) The Company had outstanding as of December 31, 2004, $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 and current 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 December
31, 2004, total accrued interest totaled $26,957.

The Company recorded interest expense of $ 99,835 and $ 78,859 for the three
month period ending December 31, 2004 and 2003.

NOTE 5: LOANS PAYABLE, UNRELATED PARTIES

      As of December 31, 2004, unrelated party debt consists of the following:

                                                                  December 31,
                                                                  2004
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                               $    279,522
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
                                                                  ------------
                                                                  $    549,522
                                                                  ============


                                       9
<PAGE>

(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 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 December 31, 2004, accrued interest totaled
$2,666.63.

(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 December 31, 2004, accrued interest totaled
$3,000.00.

(3) The Company had outstanding as of December 31, 2004, $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 December 31, 2004, accrued interest totaled
$14,202.55.

The Company recorded interest expense of $ 7,131 and $ 3,500 for the three month
period ending December 31, 2004 and 2003.

NOTE 6: STOCKHOLDER'S DEFICIENCY

Common Stock:

During the quarter ended December 31, 2004, the Company did not issue any shares
of common stock.

Stock Options:

During the quarter ended December 31, 2004, the Company did not issue any
options to purchase shares of common stock. In addition, options to purchase
367,500 shares of its common stock expired during the quarter.

Warrants:

During the quarter ended December 31, 2004, the Company did not issue any
warrants to purchase shares of common stock.

NOTE 7: RELATED PARTY TRANSACTION

At December 31, 2004, receivables and other assets, related parties include
approximately $43,000 advanced by Case Financial, LLC to Old CFI prior to the
reverse acquisition. This advance is due on demand. As of December 31, 2004, the
advance was fully offset by an impairment allowance.

During the three month period ending December 31, 2004, and December 31, 2003,
the Company recognized $ 2,592 and $ 11,845, respectively, in service fees from
Old CFI and subsidiary pursuant to a service agreement entered into in
connection with the reverse acquisition.

Service fees receivable amounted to approximately $2,592 at December 31, 2004
and is included in receivables and other assets, related parties.

During the three months ended December 31, 2004, the Company returned $372,297
to related parties upon successful case resolutions.

As of December 31, 2004, $832,149 was due from Old CFI under notes receivable
which are due on demand and accrue interest at 12 to 18 percent per annum. No
interest was recognized from these receivables during the three months ended
December 31, 2004. Accrued interest receivable from this affiliate amounted to
approximately $79,000 at December 31, 2004 and is included in receivables and
other assets, related parties. As of December 31, 2004, an impairment loss was
recognized for the $22,149 for which an impairment loss was not previously
recognized. Furthermore, all but the $22,149 secured portion of the principal
amount of the notes are unsecured and subordinated to $2,200,000 of secured
indebtedness of Old CFI. The ability of Old CFI to service and retire the notes
held by the Company is conditioned upon two primary factors: i) the
collectibility of the portfolio of investments of Old CFI retained by Old CFI,
and ii) the value of the Company's common stock, valued at $0.08 per share
during January 2005 held by Old CFI. In connection with the Company's obligation
to manage the Old CFI portfolio, it regularly reviews the collectibility of each
investment in the portfolio. As a result of the most current review, management
of the Company believes that an increase in the estimate of future contract
losses of the Old CFI portfolio is appropriate. As such, the Company's estimate
of the fair value of the assets of Old CFI would be insufficient to retire all
of its indebtedness, including the notes and the other receivables held by the
Company.


                                       10
<PAGE>

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, to a director and former
interim CEO and CFO of the Company. On March 30, 2004, the director 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 the director, the Company's former CEO and Chairman of the
Board. As of June 7, 2004, the Company entered into an agreement and mutual
release with its 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 and validity of the consideration for this
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, as of
December 31, 2004, total accrued interest on the $600,000 totaled $52,000.

On February 23, 2004, the Company appointed new Chairman of the Board of
Directors who is also an officer, director and/or has a controlling interest in
several of the entities that had loans outstanding with the Company. As a
result, as of March 31, 2004, the Company reclassified $3,896,603 from Loans
Payable to Loans Payable-Related Parties. On October 7, 2004, the director
resigned from the Board of Directors.

In March 2004, the Company entered into a $500,000 secured loan agreement with
CCWIPP, the same lender who had loaned $2.0 million to the Company in December
2002 and, an organization for whom the Chairman of the Company served as a
director. As additional consideration for this loan, the Company issued
1,000,000 shares of its common stock to CCWIPP and as a result, the lender is
now deemed a related party in that the lender's common stock ownership exceeds
5%.

As of June 7, 2004, the Company entered into an agreement and mutual release
with its 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 and validity of the consideration for this release.,
The Company has reclassified various obligations due and owing the former CEO
and parties related to him totaling $315,000 from Loans Payable-Related Parties
to Loans Payable.

NOTE 8: COMMITMENTS AND CONTINGENCIES

The Company conducts its operations utilizing leased facilities under
noncancellable 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               23,218
     2006               19,790

     Total             $43,008

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 September 30, 2004 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 September 30, 2004 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 December 31, 2004.


                                       11
<PAGE>

The Company is in default on all of its recourse debt obligations as described
in Notes 4 and 5 and, although no formal demands for payment have been made by
any of the lenders, there is no assurance that such demand will not be made in
the future and that the Company will be able to resolve such demands.

NOTE 9: GOING CONCERN

The accompanying financial statements contemplate continuation of the Company as
a going concern. The Company has incurred net losses of $379,310 and $371,046
during the 3 months ended December 31, 2004 and 2003, respectively, and
anticipates continued losses for the current fiscal year. There was an
accumulated deficit of $12,823,468 as of December 31, 2004, total liabilities
exceeded total assets by $4,302,408 as of December 31, 2004, the Company has
been experiencing cash flow problems 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 their
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.


                                       12
<PAGE>

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, Clifford R. Evans
was appointed as Chairman of the Board of Directors, replacing Mr. Alden who
remained as a director, 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 Ed Baldwin a director as well as
our 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 directors resigned including the Chairman, Clifford
Evans as well as Harvey Bibicoff, William Polley and John Irvine. In addition,
Ed Baldwin resigned his position as CEO, CFO, and director. Gordon Gregory
continued as a director. At the same Board of Directors meeting, four new
directors were appointed to fill all but one of the seats to be vacated
including Michael Schaffer, Lawrence Schaffer, William Rapaglia and Waddy
Stephenson. 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. Further, newly appointed
director Lawrence Schaffer was appointed Chief Financial Officer and President;
director William Rapaglia was appointed Chief Operating Officer; and director
Waddy Stephenson as Corporate Secretary.

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 of the corporation demanding the Company undertake an investigation
into, among other things the asserted negligence of certain officers and
directors. Management believes that this demand is being addressed through its
ongoing investigation.

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 base the
prices we charge on our underwriting and analyses of the risk, and additionally,
in the case of advances and loans, on the time value of money. In unsuccessful
cases, we realize a loss of the investment principal. 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.


                                       13
<PAGE>

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 utilize Third Party Investments in order to provide funding to our clients in
situations when our available internal capital is insufficient to fund the
transactions entirely by ourselves, or when the size of the transaction is
larger than is 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 participate 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
favorable 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 may
service 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. The amount of the allowance is based on trends in
historical loss experience, and exceeds the amount experienced on resolved
cases.

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 months ended December 31, 2004 compared with
the three months ended December 31, 2003

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.

TOTAL REVENUE

Total revenues consisting of contract fees and service fees aggregated $35,994
for the three months ended December 31, 2004 compared with $165,671 for the
three months ended December 31, 2003, a decrease of $129,677 or 78.3%.

CONTRACT FEES

Contract fee revenues were $33,403 for the three months ended December 31, 2004
compared with $153,826 for the three months ended December 31, 2003, a decrease
of $120,423 or 78.3%.

The decrease in contract fee revenue for the three months ended December 31,
2004 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.


                                       14
<PAGE>

SERVICE FEES

Service fee revenues were $2,592 for the three months ended December 31, 2004
compared with $11,845 for the three months ended December 31, 2003, a decrease
of $9,253 or 78.1%.

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 December 31, 2004 on all uncollected non
third party funded loans receivable and investments in contracts. 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.

GENERAL AND ADMINISTRATIVE

General and administrative costs and expenses were $250,232 for the three months
ended December 31, 2004 as compared with $360,202 for the three months ended
December 31, 2003. Accordingly, general and administrative expenses decreased by
$109,970 for the three months ended December 31, 2004 as compared with the three
months ended December 31, 2003.

The decrease in general and administrative costs and expenses for the three
months ended December 31, 2004 as compared with the three months ended December
31, 2003 is primarily attributable to the decrease in administrative overhead
costs. The Company terminated all employees except for the CEO, CFO and a
bookkeeper as well as relocated to less expensive office facilities which
minimized general and administrative costs.

SALES AND MARKETING

Sales and marketing expenses were $3,542 for the three months ended December 31,
2004 as compared with $84,062 for the three months December 31, 2003.
Accordingly, sales and marketing expenses decreased $80,520 for the three months
ended December 31, 2004 as compared with the three months ended December 31,
2003. 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.

OTHER INCOME (EXPENSE):

INTEREST EXPENSE

Interest expense was $107,702 for the three months ended December 31, 2004, as
compared with $111,157 during the three months ended December 31, 2003.
Accordingly, interest expense decreased $3,455 for the three months ended
December 31, 2004 as compared with the three months ended December 31, 2003.

COMMITMENTS AND CONTINGENCIES

The Company conducts its operations utilizing leased facilities under
noncancellable 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               23,218
 2006               19,790

Total              $43,008


                                       15
<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 was served with a complaint in February 2004 filed 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 is in default on all of its recourse debt obligations, although no
formal demands for payment have been made by any of the lenders, there is no
assurance that such demand will not be made in the future and that the Company
will be able to resolve such demands.

..

LIQUIDITY AND CAPITAL RESOURCES:

Our independent auditors have indicated in their report dated December 8, 2004
for the three months 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.

During the three months ended December 31, 2003, an officer and two directors
loaned $150,000 to the Company payable on demand including interest at 12% per
annum. Subsequent to December 31, 2003, an officer loaned an additional $110,000
to the Company payable on demand including interest at 12% per annum.

Our balance sheet at December 31, 2004 reflects cash of $115,139, an increase of
$81,756 for the three months then ended as compared with a decrease in cash of
$163,587 in the three months ended December 31, 2003. Net cash used in operating
activities was $216,844 for the three months ended December 31, 2003 and
$206,137 for the three months ended December 31, 2004.

During the three months ended December 31, 2004, the Company borrowed $70,000
from one related party.

During the quarter ended December 31, 2004, the Company decreased its
obligations under 3rd party investments by $373,797 as follows:

                                                   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
Repayments                          (372,297)          (1,500)        (373,797)
                                 -----------      -----------      -----------

Balance at December 31, 2004     $ 1,676,535      $   279,522      $ 1,956,057
                                 ===========      ===========      ===========

The Company does not have any material capital expenditure commitments as of
December 31, 2004.

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.


                                       16
<PAGE>

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 is a development stage company with a limited operating history and
lack of profitability

Since the Asset Purchase agreement in March 2002, the Company has had a limited
operating history and has incurred operating losses in every quarter. The
Company is subject to the risks and uncertainties usually encountered by
early-stage companies. These risks include risks that the Company cannot
attract, train or integrate into the business organization qualified personnel,
risks that fluctuations in operating results will be significant as the Company
develops and tests business practices, and risks that the Company will fail to
properly manage growth and expansion, if and when it occurs.

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.

The Company's ability to expand is limited by jurisdictional limitations

Not all states allow advances to attorneys and plaintiffs. Some jurisdictions do
not allow maintaining, supporting, promoting or assisting another person, with
money or otherwise, to prosecute a lawsuit. The practice is referred to as
"maintenance." Similarly, the bargain between a stranger and a party to a
lawsuit by which the stranger pursues the party's claim in consideration of
receiving part of any judgment proceeds may be a form of "maintenance" and may
not be permitted in some jurisdictions. The Company's ability to grow and expand
the Company's business may be limited to specific jurisdictions. The Company's
inability to expand beyond such jurisdictions may negatively impact its
business, prospects and results of operations.

Courts may deem the Company's advances to be loans resulting in limitations on
how the Company does business

The Company does not loan money to plaintiffs. The recovery agreement between
the Company and the individual or law firm receiving the advance clearly states
that the advance is not a loan, and that it is not to be repaid if the lawsuit
is lost. Accordingly, the Company believes that it is not subject to various
laws and regulations that constrain lending activities. However, there can be no
assurance that a court in any jurisdiction in which the Company pursues its
business would not examine the Company's activities and come to the conclusion
that the Company was in fact lending money to plaintiffs. One result of such a
conclusion by a court would be that the rate of return on the Company's advances
may exceed the rates of return permitted by law. Such a conclusion would make
the Company's agreements with plaintiffs voidable, subject the Company to fines
or other sanctions or otherwise negatively impact the Company's business,
prospects or results of operations.

The Company has limited underwriting experience and information on which to base
its operations factors that may make it more difficult to evaluate the Company's
business and results

The Company has only four years of precedents upon which to base its operations.
The Company also has only four years of experience underwriting risks. While the
Company believes that the time spent in the past four years refining its
underwriting procedures allows it to evaluate the plaintiffs and cases to whom
it advances money, there is no extensive history in underwriting upon which the
Company or investors may rely. Although the Company makes comparisons to other
claims and is compiling a database to assist the Company's underwriting
procedures, the Company does not have an extensive database upon which it can
make the Company's underwriting decisions. Underwriting decisions made on
incomplete or inaccurately assessed information may lead to lower rates of
claims recovery and may have an adverse impact on the Company's business and
results of the Company's operations.

The Company only has a limited history of operations upon which it can rely with
regard to both the nature of the service it provides and its ability to provide
that service. Through the Company's sales efforts the Company must educate its
consumer base with regard to its business. Unlike other financial services, the
Company's services are not well known in the general population. Therefore, the
Company cannot give any assurances that it will be successful in educating
potential consumers about its services and especially educating consumers about
its services in a manner that will be attractive to consumers. A failure to so
educate consumers may hamper the Company's sales efforts and have an adverse
impact on the Company's business, prospects and results of operations.


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<PAGE>

Tort reform in the form of legislated restrictions on plaintiff's ability to sue
would negatively affect the Company's business

In addition to the uncertainties inherent in litigation, tort reform may
negatively impact the Company's business. The legislatures in any of the
jurisdictions where the Company operates may pass legislation that restricts a
plaintiff's ability to sue. Such restrictions may be in the form of altering or
eliminating claims that may be heard in court or changing statutes of limitation
or the periods of time plaintiffs have to make a claim. These or other
restrictions on the right to sue may limit the market for the Company's services
and negatively impact the Company's business, prospects and results of
operations. Legislatures could also limit the amounts that could be recovered
for specific claims. Such limitations, if enacted, could negatively impact the
Company's business, prospects and results of operations.

The Company's need for information about a case may have a negative impact on
its outcome

The Company's need for information about a case may result in an adverse outcome
of the case. In general, communications between a client and the client's
attorney are privileged. However, the Company requires information to assess the
case. While in the course of obtaining the information the Company requires, the
Company strives to keep such communications privileged and confidential, a court
may determine that such communications with the Company are not privileged. If
the privileged information given to the Company may be discovered by the
defendant such information may be used against the client. Either situation, the
inability to obtain privileged information the Company needs to assess the case,
or making privileged information discoverable to the defendants, increases the
likelihood of outcomes which would be adverse to the Company's business,
prospects and results of operations..

The Company's business may be copied by competitors as there are few if any
barriers to competition

Other than an expertise in assessing underwriting risks and the Company's
database, the Company's business is not dependent upon proprietary information.
Accordingly, there are no substantial barriers to potential competitors. The
Company may not be able to compete successfully against current or future
competitors. In addition, competition may drive down the return on the Company's
advances. Given the risks inherent in the Company's business, a reduction in the
rate of the Company's return may impact the viability of the Company's business
model. There is no assurance that the Company may be able to compete
successfully against others who offer similar services or that such competition
may not reduce the rate of return the Company receives for its advances.

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:

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.


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<PAGE>

ITEM 3. CONTROLS AND PROCEDURES

Disclosure controls and procedures are designed to ensure that information
required to be disclosed in the reports filed or submitted under the Exchange
Act of 1934 is recorded, processed, summarized and reported, within the time
periods specified in the rules and forms of the Securities and Exchange
Commission. Disclosure controls and procedures include, without limitation,
controls and procedures designed to ensure that information required to be
disclosed in the reports filed under the Exchange Act of 1934 is accumulated and
communicated to management, including its principal executive and financial
officers, as appropriate, to allow timely decisions regarding required
disclosure.

The Company carried out an evaluation, under the supervision and with the
participation of the Company's management, including its newly appointed
principal executive and financial officer, of the effectiveness of the design
and operation of the Company's disclosure controls and procedures as of the end
of the period covered by this report. Based upon and as of the date of that
evaluation, the Company's principal executive and financial officer concluded
that the Company's disclosure controls and procedures are effective to ensure
that information required to be disclosed in the reports the Company files and
submits under the Exchange Act of 1934 is recorded, processed, summarized and
reported within the time periods specified in the Securities and Exchange
Commission's rules and forms.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

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 December 31, 2004 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 December 31, 2004 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 December 31, 2004.

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

None.

ITEM 3. DEFAULTS IN SENIOR SECURITIES.

None.

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:

1. The following Exhibits are filed herein:


                                       19
<PAGE>

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


                                       20
<PAGE>

                                   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: February 28, 2005

                                             By: /s/Lawrence Schaffer
                                                 -----------------------

                                                 Chief Financial Officer
                                                 Date: February 28, 2005


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