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

                                   FORM 10-KSB

[X]      ANNUAL REPORT UNDER OR OF THE SECURITIES EXCHANGE ACT OF 1934

                   For the fiscal year ended December 31, 2004

                   -------------------------------------------

[ ]      TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
         EXCHANGE ACT OF 1934

     For the transition period from _______________________ to _____________

Commission file number 0-27750
                       -------

                         FIRSTPLUS Financial Group, Inc.
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                 (Name of small business issuer in its charter)

Nevada                                                        75-2561085
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(State or other jurisdiction of incorporation) (IRS Employer Identification No.)

       0-27750
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(Commission File Number)

5100 North O'Connor Blvd., 6th Floor
Irving, Texas                                                 75039
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(Address of Principal Executive Offices)                   (Zip Code)

                                 (214) 231-7600
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                           (Issuer's telephone number)

Securities registered under Section 12(b) of the Exchange Act:  None

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

                     Common Stock, par value $.01 per share
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                                (Title of class)

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

Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure will be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. [X]

Registrant's revenues for its most recent fiscal year:     $0.

Aggregate market value of Registrant's voting and non-voting common equity held
by non-affiliates: Currently no trading market

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<PAGE>

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date. As of July 28, 2005, the issuer had
45,340,090 shares of common stock, $.01 Par Value, outstanding.

Transitional Small Business Disclosure Format (Check one): Yes ____; No _X__

GENERAL NOTE

         Except where otherwise stated, references in this document to "us,"
"we," "FPFG" or "the Company" refer to FIRSTPLUS Financial Group, Inc.
("FIRSTPLUS"). This Form 10-KSB contains forward-looking statements within the
meaning of the "safe harbor" provisions under Section 21E of the Securities
Exchange Act of 1934, as amended, and the Private Securities Litigation Reform
Act of 1995. We use forward-looking statements in our description of our plans
and objectives for future operations and assumptions underlying these plans and
objectives, as well as in our expectations, assumptions, estimates and
projections about our business and industry. These forward-looking statements
involve risks and uncertainties. Our actual results could differ materially from
those anticipated in such forward-looking statements as a result of certain
factors as more fully described in this Report.

         Forward-looking terminology includes the words "may", "expects",
"believes", "anticipates", "intends", "projects" or similar terms, variations of
such terms or the negative of such terms. These forward-looking statements are
based upon our current expectations and are subject to factors and uncertainties
which could cause actual results to differ materially from those described in
such forward-looking statements. We expressly disclaim any obligation or
undertaking to release publicly any updates or revisions to any forward-looking
statements contained in this Report to reflect any change in our expectations or
any changes in events, conditions or circumstances on which any forward-looking
statement is based.

                                       2
<PAGE>

                                     PART I

ITEM 1.  DESCRIPTION OF BUSINESS.

         FIRSTPLUS Financial Group, Inc. (the "Company") was incorporated in
1994 in the State of Nevada. The Company was a diversified consumer finance
company that originated, serviced, and sold consumer finance receivables. The
Company operated through various subsidiaries until 1998 when macroeconomic
factors adversely affected financial markets and largely destroyed the
industry's access to the capital markets. Without access to working capital, the
Company's ability to provide consumer-based products evaporated and, like
virtually all its competitors, it saw its business liquidated to satisfy
obligations. The Company's principal operating subsidiary, FIRSTPLUS Financial,
Inc. ("FPFI"), engaged in the business of originating, purchasing, marketing and
servicing home equity loans. Prior to the collapse of the financial markets, its
primary loan product was a credit consolidation or home improvement loan, which
was generally secured by a second lien on real property (commonly referred to as
a "high loan to value" or "HLTV" loan). Over the course of many years, FPFI
originated billions of dollars of loans. By 1998, FPFI had attained a market
leadership position in the HLTV loan business.

         In March 1999, two of the Company's wholly-owned subsidiaries, FPFI,
and FIRSTPLUS Special Funding Corp., filed for reorganization under Chapter 11
of the United States Bankruptcy Code. FIRSTPLUS Special Funding Corp. was a
special purpose entity formed to facilitate certain borrowings by FPFI. The
filing was made in the United States Bankruptcy Court for the Northern District
of Texas in Dallas. Neither the Company, nor any of its other subsidiaries,
sought bankruptcy protection.

         Although the Company was not subject to any bankruptcy proceedings, it
had no income producing activities and was dependent on its subsidiaries to fund
its obligations. FPFI was severely limited in its ability to provide funds to
the Company as a result of the bankruptcy filing. The Company's other
significant operating subsidiary at the time, Western Interstate Bancorp
("WIB"), was limited in its ability to release funds to the Company due to its
debt covenant restrictions. Additionally WIB's main operating company, a
FDIC-insured industrial loan company, FIRSTPLUS Bank, was also limited in the
amount of funds that it could release by way of dividends or intercompany loans
due to regulatory restrictions. These limitations caused the Company and its
other subsidiaries to experience liquidity issues similar to FPFI.

         The liquidity issues leading to the FPFI's bankruptcy filing and the
subsequent lack of operations and sources of income of the Company required
significant focus by senior management of the Company. Additionally, senior
management concentrated on related strategic issues such as negotiating with
lenders and creditors, finding new sources of financing, and reorganizing and
recapitalizing the Company. The resources available to the Company have been
limited by the liquidity issues and the downsizing of the Company and its
operations.

         Primarily due to lack of funds, the Company has for the most part been
in a dormant capacity for the past several years. The Company currently has one
employee, its President and Chief Executive Officer, Mr. Jack (J.D.) Draper. Mr.
Draper does not have an employment agreement with the Company. Since 1999, the
Company has managed to avoid bankruptcy by negotiating with creditors and
utilizing the anticipated but uncertain cash flow from an allowed unsecured
claim against FPFI, more commonly known as the FPFG Intercompany Claim. The
Company's management has withstood the pressure from creditors and avoided
bankruptcy primarily by assigning portions of the FPFG Intercompany Claim to
various creditors. However, the Company has maintained that one of its
strategies has been to create value in the Company so that its prospects are
enhanced for the future. The Company has been active in seeking a platform for
operations and has pursued several opportunities; however those opportunities
were abandoned when the transactions did not meet the expectations of the
Company after further examination and the Company learned of opposition to those
transactions by certain shareholders.

ITEM 2.  DESCRIPTION OF PROPERTY.

         The Company's executive offices are shared with the facilities leased
by Capital Lending Strategies, LLC ("Capital Lending"), which incurs the cost
and full responsibility of the lease. There is no formal agreement between the
Company and Capital Lending with respect to the lease arrangement.

                                       3
<PAGE>

ITEM 3.  LEGAL PROCEEDINGS.

         Bankruptcy of FirstPlus Financial, Inc.

         Prior to 1998, the Company operated its business through those
subsidiaries with success until 1998 when macroeconomic factors adversely
affected financial markets and largely destroyed the industry's access to the
capital markets. Without access to working capital, the ability of the Company
to provide consumer-based products evaporated and, like virtually all its
competitors, it saw its business liquidated to satisfy obligations. The
Company's largest subsidiary was FPFI, a company that engaged in the business of
originating, purchasing, marketing and servicing home equity loans. Prior to the
collapse of the financial markets, its primary loan product was a credit
consolidation or home improvement loan, which was generally secured by a second
lien on real property (commonly referred to as a "high loan to value" or "HLTV"
loan). Over the course of many years, FPFI originated billions of dollars of
loans.

         FPFI's business depended on its ability to securitize or sell the HLTV
loans in the secondary market in order to generate cash proceeds to repay
warehouse lines of credit, fulfill repurchase obligations and for new
originations and loan purchases. The value of and market for FPFI's loans were
dependent upon a number of factors, including general economic conditions,
interest rates and governmental regulations. Starting in mid-1998, a prolonged,
substantial reduction in the size of the secondary market for loans of the type
originated or purchased by FPFI adversely affected its ability to securitize or
sell loans with a consequent adverse impact on its ability to continue to
originate and purchase loans. Due to the disappearance of the secondary market,
which destroyed the HLTV loan market and FPFI's business, FPFI filed a voluntary
petition for relief under Chapter 11 of the Bankruptcy Code.

         FPFI's plan of reorganization was confirmed on April 7, 2000 by the
United States Bankruptcy Court, Northern District of Texas, Dallas Division. The
plan of reorganization provided for the creation of the FPFI Creditor Trust (the
"Creditor Trust") to facilitate implementation of the plan of reorganization, to
hold trust assets for the benefit of the beneficiaries, to resolve claims, to
make distributions in accordance with the plan of reorganization and to provide
various administrative services related to the Creditor Trust and the
implementation of the plan of reorganization. Under the plan of reorganization,
the Company still owns FPFI but may not transfer its interest in FPFI until the
Creditor Trust terminates. However, the Creditor Trust trustee is the sole
officer and director of FPFI. In addition, the stock was to be transferred to a
voting trust whereby the voting trust would have the sole power to hold and vote
the stock. As a result, the Company has very little influence over FPFI or the
Creditor Trust's assets.

         In the plan of reorganization, the Company was able to resolve many of
its own creditor claims through the plan of reorganization. In addition, the
Company received the FPFG Intercompany Claim as a general unsecured claim in an
amount that was not to be less than $50 million. By being a holder of the FPFG
Intercompany Claim, the Company became a beneficiary of the Creditor Trust.
Under the plan of reorganization, the Company would only receive distributions
as a beneficiary of the Creditor Trust from payments on the FPFG Intercompany
Claim based on a previous series of securitized loan pools that had been sold in
the marketplace. At that time, the amount and timing of cash flow from residuals
was completely unknown. The Company has no operations with respect to, or any
control over, the securitized loans.

         To settle other claims asserted against it, the Company assigned
portions of the FPFG Intercompany Claim to various creditors. Consistent with
the plan of reorganization, in settlement of the claims of the holders of the
Company's 7.25% Convertible Subordinated Notes due 2003, the bondholders
received an instrument representing the right to receive an assignment of 25% of
the FPFG Intercompany Claim, permitting the bondholders to become a direct
beneficiary of the Creditor Trust, and an agreement to instruct the Creditor
Trust to make two payments to the bondholders of $1,428,000 based on certain
conditions. The bondholder settlement was consummated in June 2001. Two of the
bondholders also received agreements allowing them to convert portions of their
new interest into an aggregate of 5,555,000 shares of the Company's common
stock.

         At the closing of the plan of reorganization, in settlement of claims
of Paine Webber Real Estate Securities Inc. ("Paine Webber"), the Company
assigned a 22% interest in the FPFG Intercompany Claim to Paine Webber allowing
Paine Webber to become a direct beneficiary of the Creditor Trust. The Paine
Webber claim has been settled, and the Company recovered the assignment from
Paine Webber in August 2005.

                                       4
<PAGE>

         The Company has agreed to pay 1.86% of the distributions it receives,
up to an aggregate amount of $931,000, on the FPFG Intercompany Claim to Thaxton
Investment Corporation ("Thaxton"). The amounts payable to Thaxton are based on
a settlement of disputes concerning the purchase price paid by Thaxton to
FirstPlus Consumer Finance, Inc. ("Consumer Finance"), then a subsidiary of the
Company, pursuant to the sale of all of the assets of Consumer Finance to
Thaxton in 1999.

         The Company has previously discussed with other creditors settlement of
various claims by assignment of portions of the FPFG Intercompany Claim. Since
the bankruptcy proceedings, the FPFG Intercompany Claim had been the only
substantial asset of the Company and the only source of potential payment for
its obligations. Negotiations with other parties have been dormant in recent
years; however, there is no assurance that there are no additional parties who
may assert claims with respect to the FPFG Intercompany Claim. The Company has
booked a valuation reserve of $2.9 million against the amount set aside for
potential creditors claims.

         There can be no assurance as to the ultimate value of the FPFG
Intercompany Claim or the timing of distributions on the FPFG Intercompany
Claim.

         Class Action Securities Litigation

         In October 1998, several class action lawsuits alleging violations of
federal securities laws were filed in the United States District Court for the
Northern District of Texas. These lawsuits were consolidated as In re: FirstPlus
Financial Group, Inc. Securities Litigation (the "Class Action"). The Class
Action named the Company and certain officers and directors as defendants. The
Class Action alleged, among other things, that the defendants issued false and
misleading financial statements, press releases and other statements regarding
the Company's financial condition during a time period between August 1996 and
November 1998. During the course of the Class Action, the defendants strenuously
denied the allegations asserted by the plaintiffs, and without admitting any
wrongdoing or liability, the defendants entered into a settlement with the
plaintiffs in July 2003.

         In October 2003, the United States District Court for the Northern
District of Texas held a fairness hearing regarding the settlement of the Class
Action where the court approved the settlement of the class action as fair,
reasonable and adequate to the members of the class and directed the parties to
consummate the settlement. Following the fairness hearing, the court entered its
Order and Final Judgment and order of dismissal of the actions with prejudice.
Therefore, the Order and Final Judgment should preclude any other lawsuits by
shareholders with respect to the allegations set forth in the class action
securities lawsuit. The Company completed the final steps to consummate the
settlement on November 24, 2003, the effective date of the settlement.

         The settlement agreement provided for a cash settlement of $5 million
to be paid into an interest bearing account maintained by the plaintiff's
co-lead counsel in escrow. The settlement agreement also provided for the
Company to assign its rights to distributions of cash and property based on a
portion of its ownership interests in Capital Lending to the plaintiffs' co-lead
counsel in escrow on behalf of the authorized claimants. The Company then owned
approximately 38% of Capital Lending and agreed to make the assignment based on
a 10 percent ownership interest in Capital Lending. In addition, if Capital
Lending files a registration statement with the Securities and Exchange
Commission covering the distribution of the ownership interest to the authorized
claimants, the Company has agreed to transfer the 10% ownership interest in
Capital Lending directly to the plaintiffs' co-lead counsel in escrow on behalf
of the authorized claimants under the Stipulation.

         Plaintiffs' co-lead counsel received 30% of the settlement fund, which
may include a portion of the assigned ownership interests in Capital Lending,
excluding interest, plus approximately $394,000 in reimbursement for expenses to
be funded by the settlement fund, plus interest at the rate earned on the cash
portion of the settlement fund until paid.

         In connection with the Order and Final Judgment, Daniel T. Phillips,
then Chief Executive Officer and Director of the Company, resigned all positions
with the Company and its subsidiaries effective as of the consummation of the
settlement, except as Director of the Company. Mr. Phillips has continued as a
Director of the Company. J.D. Draper assumed the position of President, Chief
Executive Officer and Chief Financial Officer of the Company.

         Grantor Trust Litigation

                                       5
<PAGE>

         In 2002, the Company as sole settlor and sole beneficiary established
the FirstPlus Financial Group, Inc. Grantor Residual Trust (the "Grantor Trust")
and assigned to the Grantor Trust the Company's remaining interest in the FPFG
Intercompany Claim. The initial trustee of the Grantor Trust was George T. Davis
("Davis").

         In November 2004, the Company appointed two additional trustees for the
Grantor Trust. Thereafter, those additional trustees sought to reach agreement
with Davis (who remained as a trustee) concerning the distribution of funds
which were beginning to flow to the Grantor Trust from the FPFI bankruptcy.
Davis challenged the appointment of the additional trustees and refused to agree
to a distribution proposed by the Company. The Company and the additional
trustees filed suit in Texas state court in Dallas (FirstPlus Financial Group,
Inc., Michael Montgomery, Jack Draper and The FirstPlus Financial Group Grantor
Residual Trust v. George T. Davis and The FPFI Creditor Trust; Civil Action No.
05-02962; in the 298th District Court of Dallas County, Texas) (the "Trust
Suit") seeking declaratory relief against Davis and the FPFI creditors' trust to
the effect that the additional trustees had been properly appointed and were
authorized to act.

         When the Company selected Davis as the initial trustee upon formation
of the Grantor Trust, the Company had confidence in its appointee and also
appointed Davis as Vice President of Shareholder Relations. He also was
appointed to a vacant seat on the Board of Directors. The Company believed that
Davis would also have the confidence of a group of shareholders with whom the
Company consulted prior to the formation of the Grantor Trust, including a group
of shareholders purportedly represented by Danford L. Martin.

         Distributions on the FPFG Intercompany Claim, including distributions
to the Grantor Trust, became available in the fourth quarter of 2004. Prior to
the actual distribution of funds to the Grantor Trust, a dispute arose with
Davis concerning the validity of the Company's appointment of additional
trustees for the Grantor Trust. Because this unresolved issue led to uncertainty
on the part of the Creditor Trust as to who could properly direct the
distribution of funds to the Grantor Trust, the Creditor Trust requested that
the bankruptcy court take custody of the funds and resolve the trustee issue.
The bankruptcy court determined, however, that it did not have jurisdiction to
resolve that dispute and dismissed the Creditor Trust's request. Immediately
thereafter, the Company initiated the Trust Suit in Texas state court. That
action remains pending, and while funds totaling approximately $7.9 million are
currently available for distribution by the Creditor Trust to the Grantor Trust,
no such funds have actually been distributed to the Grantor Trust due to the
dispute over the trustee issue.

         When it appeared that payments on the FPFG Intercompany Claim were
about to commence, Davis began making unfounded allegations against the
well-respected trustee of the Creditor Trust, with whom the Company believes it
otherwise has a good relationship. The allegations were unsupported factually
but continued to be lodged by Davis. The Company believes that these accusations
were contrary to the interests of the Grantor Trust in that the trustee of the
Creditors Trust is the person who processes all payments to the Grantor Trust on
account of the FPFG Intercompany Claim.

         Further, as the commencement of payments on the FPFG Intercompany Claim
appeared imminent, the Board of Directors sought confirmation from Davis that
creditors holding valid claims against the Company would not be ignored and
would be paid as distributions on the FPFG Intercompany Claim were received as
required by the trust agreement governing the Grantor Trust. Davis refused to
provide that confirmation to the Board of Directors and took no steps to
adequately plan for the payment of creditor claims.

         In light of Davis' behavior concerning the Grantor Trust's sole source
of revenue and disregarding the need to pay creditors with valid claims, the
Board of Directors believed that appointing two additional trustees to the
Grantor Trust would improve relations with the Creditor Trust and ensure that
provisions for the creditors of FirstPlus would be made. The Company did not
remove Davis as trustee at that time.

         Upon the appointment of the two additional trustees, they began to
develop a plan for a distribution to shareholders with adequate provisions for
creditors. In an effort to resolve the dispute between the additional trustees
and Davis, the additional trustees proposed an immediate distribution to the
Grantor Trust, followed by a $3.5 million distribution to the shareholders which
the additional trustees agreed would not affect the determination of the issues
in the Trust Suit. Davis has continued to object to any distribution to
shareholders unless he can be designated as the sole party to have access and
control over the funds held by the Grantor Trust. In this regard, the Grantor
Trust, acting through a majority of the trustees, attempted to reach an
agreement with Davis to make a distribution to shareholders.

                                       6
<PAGE>

         While that action was pending, the Company, as settlor of the Grantor
Trust, terminated Davis for cause pursuant to the terms of the trust agreement
governing the Grantor Trust and appointed a successor trustee. Davis has sought
declaratory relief in the Trust Suit to the effect that he has not been
terminated. However, a continuation of litigation by Davis and his refusal to
attempt to resolve the dispute between the trustees has amounted to a veto of
the intended distribution to the shareholders.

         Special Meeting Litigation

         In March 2005, a group of Company shareholders commenced a court
action, styled Danford L. Martin, et al. v. FirstPlus Financial Group, Inc., et
al., in the Second Judicial District Court for the State of Nevada (the
"Election Suit") to compel a shareholders' meeting and election of directors.
The Company has treated the Election Suit as a valid request for meeting
pursuant to the bylaws. During the hearings in the court and in discussions with
the petitioners in the Election Suit, the Company has at all times insisted that
the meeting and the election be conducted in accordance with all applicable
laws, regulations and procedures.

         The petitioners submitted two separate plans of election that the
Company believed would have, if adopted by the court, resulted in a meeting (i)
without providing shareholders with customary and necessary information on the
subject of the election, (ii) that would have failed to convene a quorum, (iii)
that would have failed to yield a valid outcome under the Company's articles of
incorporation and bylaws and applicable law, and (iv) that would have violated
applicable law in numerous respects. In fact, under one of the petitioners'
proposed plans of election, the solicitation of proxies and provision of
information to shareholders regarding the subject of the meeting would have been
expressly forbidden. The Company's position has at all times been that the
shareholders should receive the required disclosures about the Company and about
the persons soliciting votes, including those persons soliciting votes in
opposition to the Company.

         The court has directed that a shareholders' meeting and election of
directors, utilizing the proxy process, be held. The meeting is currently
scheduled for November 16, 2005 in Reno, Nevada. The Company has informed the
petitioners that it intends to follow applicable laws, regulations and, except
to the extent otherwise expressly directed by the court, provisions of the
Company's articles of incorporation and bylaws in the conduct of the meeting and
the election.

         Although it was not required to do so, the Company has paid attorney's
fees for the petitioners in an aggregate amount of $25,000 and has agreed to pay
printing and distribution fees for petitioners' proxy materials in an amount not
to exceed an aggregate of $20,000, which the parties have stipulated fully
satisfies any and all requests petitioners have made or could have made in the
future concerning reimbursement for petitioners' attorneys' fees and expenses
associated with the Election Suit.

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

         There were no matters submitted to a vote of the security holders
during the fourth quarter of the fiscal year ended December 31, 2004.

                                       7
<PAGE>

                                     PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

         There is no established public trading market for the Company's common
stock. The Company's common stock is quoted under the symbol "FPFX" in the Pink
Sheets. As of July 28, 2005, there were 1,298 shareholders of record of the
Company's common stock and 45,340,090 shares issued and outstanding. The Company
has not made any dividends on its common stock in the last two fiscal years. The
Company has not had any revenues in the last two fiscal years. However, proposed
distributions to the Company's shareholders from the Grantor Trust are discussed
in Item 3, Legal Proceedings, under the heading "Grantor Trust Litigation."
Distributions from the Grantor Trust are limited by the terms of the Grantor
Trust's trust agreement, which forbids distributions from the trust estate to
shareholders if the distribution would render the Company insolvent.

ITEM 6.  PLAN OF OPERATION.

General

         FIRSTPLUS Financial Group, Inc. (the "Company") was a diversified
consumer finance company that originated, serviced, and sold consumer finance
receivables. The Company operated through various subsidiaries until 1998 when
macroeconomic factors adversely affected financial markets and largely destroyed
the industry's access to the capital markets. Without access to working capital,
the Company's ability to provide consumer-based products evaporated and, like
virtually all its competitors, it saw its business liquidated to satisfy
obligations. The Company's principal operating subsidiary, FIRSTPLUS Financial,
Inc. ("FPFI"), engaged in the business of originating, purchasing, marketing and
servicing home equity loans. Prior to the collapse of the financial markets, its
primary loan product was a credit consolidation or home improvement loan, which
was generally secured by a second lien on real property (commonly referred to as
a "high loan to value" or "HLTV" loan). Over the course of many years, FPFI
originated billions of dollars of loans. By 1998, FPFI had attained a market
leadership position in the HLTV loan business.

         In March 1999, two of the Company's wholly-owned subsidiaries, FPFI,
and FIRSTPLUS Special Funding Corp., filed for reorganization under Chapter 11
of the United States Bankruptcy Code. FIRSTPLUS Special Funding Corp. was a
special purpose entity formed to facilitate certain borrowings by FPFI. The
filing was made in the United States Bankruptcy Court for the Northern District
of Texas in Dallas. Neither the Company, nor any of its other subsidiaries,
sought bankruptcy protection.

         Although the Company was not subject to any bankruptcy proceedings, it
had no income producing activities and was dependent on its subsidiaries to fund
its obligations. FPFI was severely limited in its ability to provide funds to
the Company as a result of the bankruptcy filing. The Company's other
significant operating subsidiary at the time, Western Interstate Bancorp
("WIB"), was limited in its ability to release funds to the Company due to its
debt covenant restrictions. Additionally WIB's main operating company, a
FDIC-insured industrial loan company, FIRSTPLUS Bank, was also limited in the
amount of funds that it could release by way of dividends or intercompany loans
due to regulatory restrictions. These limitations caused the Company and its
other subsidiaries to experience liquidity issues similar to FPFI.

         The liquidity issues leading to the FPFI's bankruptcy filing and the
subsequent lack of operations and sources of income of the Company required
significant focus by senior management of the Company. Additionally, senior
management concentrated on related strategic issues such as negotiating with
lenders and creditors, finding new sources of financing, and reorganizing and
recapitalizing the Company. The resources available to the Company have been
limited by the liquidity issues and the downsizing of the Company and its
operations.

         Primarily due to lack of funds, the Company has for the most part been
in a dormant capacity for the past several years. Since 1999, the Company has
managed to avoid bankruptcy by negotiating with creditors and utilizing the
anticipated but uncertain cash flow from an allowed unsecured claim against
FPFI, more commonly known as the FPFG Intercompany Claim. The Company's
management has withstood the pressure from creditors and avoided bankruptcy
primarily by assigning portions of the FPFG Intercompany Claim to various
creditors. However, the Company has maintained that one of its strategies has
been to create value in the Company so that its prospects are enhanced for the
future. The Company has been active in seeking a platform for operations and has
pursued several

                                       8
<PAGE>

opportunities; however those opportunities were abandoned when the transactions
did not meet the expectations of the Company after further examination and the
Company learned of opposition to those transactions by certain shareholders.

Strategic Plan

         Although the Company is not pursuing any specific opportunities at this
time, it is reviewing the marketplace and its strategic plan. The areas for
opportunity may include buying an existing company, merging with a growing
concern or entering into a joint venture. In 2003, the Company received a
substantial return on its investment in Capital Lending, a startup company which
provides financial and risk services offering insured loan programs to financial
institutions. In recent years, the financial services industry has seen
substantial growth and the Company is confident that this trend will continue.
The Company offers strong leadership with the vision and passion needed to
catapult the Company into any sector of the industry.

         The Company has not identified a target business

         To date, the Company has not selected any target business on which to
concentrate its search for a business combination. Thus, there is no basis to
evaluate the possible merits or risks of any target business or potential
transaction into which the Company may enter. To the extent the Company enters
into a transaction with a financially unstable company or an entity in its early
stage of development or growth, including entities without established records
of sales or earnings, the Company may be affected by numerous risks inherent in
the business and operations of financially unstable and early stage or potential
emerging growth companies. Although the Company's management will endeavor to
evaluate the risks inherent in a particular target business, the Company cannot
assure you that it will properly ascertain or assess all significant risk
factors.

         Sources of potential opportunities

         The Company anticipates that business opportunities will be brought to
its attention from various sources, including its network relationships, who may
present solicited or unsolicited proposals. The Company's officers and directors
as well as their affiliates may also bring transaction candidates to the
Company's attention. While the Company does not presently anticipate engaging
the services of professional firms that specialize in business acquisitions on
any formal basis, the Company may engage these firms in the future, in which
event the Company may pay a finder's fee or other compensation. In no event,
however, will the Company pay any of its existing officers, directors or
shareholders or any entity with which they are affiliated any finder's fee or
other compensation for services rendered to it prior to or in connection with
the consummation of a transaction.

         Selection of a potential business opportunity and structuring of a
transaction

         In evaluating a prospective business opportunity or transaction, the
Company will consider, among other factors, the following:

         o        financial condition and results of operation;

         o        growth potential;

         o        experience and skill of management and availability of
                  additional personnel;

         o        capital requirements;

         o        competitive position;

         o        stage of development of the products, processes or services;

         o        degree of current or potential market acceptance of the
                  products, processes or services;

         o        proprietary features and degree of intellectual property or
                  other protection of the products, processes or services;

         o        regulatory environment of the industry; and

                                       9
<PAGE>

         o        costs associated with effecting the business combination.

         These criteria are not intended to be exhaustive. Any evaluation
relating to the merits of a particular business opportunity or transaction will
be based, to the extent relevant, on the above factors as well as other
considerations deemed relevant by the Company's management in pursuing the
business opportunity or transaction consistent with the Company's overall
strategy. In evaluating a prospective business opportunity or transaction, the
Company will conduct an extensive due diligence review which will encompass,
among other things, meetings with incumbent management and inspection of
facilities, as well as review of financial and other information which will be
made available to the Company.

         The fair market value of such business will be determined by the
Company's Board of Directors based upon standards generally accepted by the
financial community, such as actual and potential sales, earnings and cash flow
and book value. If the Board of Directors is not able to independently determine
that the target business has a sufficient fair market value, the Company will
obtain an opinion or valuation from an unaffiliated, independent investment
banking or business valuation firm with respect to the satisfaction of such
criteria. For example, a valuation was obtained for the Company's proposed
transaction with New Freedom Mortgage Corporation in 2001, although the
transaction was not consummated, and the Company obtained a fairness opinion
with respect to its initial equity investment in Capital Lending in 2002.

         The time and costs required to select and evaluate a business
opportunity and to structure and complete a transaction cannot presently be
ascertained with any degree of certainty. Any costs incurred with respect to the
identification and evaluation of a prospective business opportunity or
transaction will result in a loss to the Company and reduce the amount of
capital available to otherwise complete a business combination.

         Probable lack of business diversification

         While the Company may seek to pursue business opportunities with more
than one target business, it is probable that the Company will have the ability
to pursue only a single business opportunity or transaction. Accordingly, the
prospects for the Company's success may be entirely dependent upon the future
performance of a single business or investment. Unlike other entities that may
have the resources to complete several transactions in multiple industries or
multiple areas of a single industry, it is probable that the Company will not
have the resources to diversify its operations or benefit from the possible
spreading of risks or offsetting of losses. The Company's lack of
diversification may:

         o        subject the Company to numerous economic, competitive and
                  regulatory developments, any or all of which may have a
                  substantial adverse impact upon the particular industry in
                  which it may operate subsequent to a transaction, and

         o        result in the Company's dependency upon the development or
                  market acceptance of a single or limited number of products,
                  processes or services.

         Limited ability to evaluate the target business' management

         Although the Company intends to closely scrutinize a prospective
business opportunity or transaction, the Company cannot assure you that its
assessment of the prospective business opportunity or transaction will prove to
be correct. Furthermore, the future role of the Company's officers and
directors, if any, in a prospective business opportunity or transaction cannot
presently be stated with any certainty. While it is possible that one or more of
the Company's current officers and directors will remain associated in some
capacity with the Company following a prospective business opportunity or
transaction, it is unlikely that any of them will devote their full efforts to
the Company's affairs subsequent to prospective business opportunity or
transaction. Moreover, the Company cannot assure you that its officers and
directors will have significant experience or knowledge relating to the
operations of the particular prospective business opportunity or transaction.

         Following a transaction, the Company may seek to recruit additional
executive officers or employees to supplement its current management. The
Company cannot assure you that it will have the ability to recruit additional
executive officers or employees, or that additional executive officers or
employees will have the requisite skills, knowledge or experience necessary to
enhance the Company's current management.

                                       10
<PAGE>

Competition

         In identifying, evaluating and selecting a business opportunity, the
Company expects to encounter intense competition from other entities having
similar business objectives. Many of these entities are well established and
have extensive experience identifying and effecting business opportunities
directly or through affiliates. Many of these competitors possess greater
technical, human and other resources than the Company and its financial
resources will be relatively limited when contrasted with those of many of these
competitors. While the Company believes there are numerous potential business
opportunities or transactions that may be available to it, the Company's ability
to compete in pursuing these opportunities or transactions will be limited by
its available financial resources. This inherent competitive limitation gives
others an advantage in pursuing these business opportunities or transactions.

         Any of these obligations may place the Company at a competitive
disadvantage in successfully pursuing a business opportunity or transaction. The
Company believes, however, that its network relationships and the experience of
its management team and Board of Directors may give it a competitive advantage
over other competitors for pursuing business opportunities or transactions.

Financial Reporting Issues

         Changes In and Disagreements With Accountants on Accounting and
Financial Disclosure

         On June 3, 2005, the Company engaged Lightfoot Guest Moore & Co., PC,
as its independent auditor for the year ending December 31, 2004. The Company
had not formally had an independent auditor since September 1999, when Ernst &
Young LLP resigned as the Company's principal accountant. The resignation of
Ernst & Young LLP was discussed in a Current Report on Form 8-K filed with the
Securities and Exchange Commission ("SEC") on October 6, 1999.

         The Company disclosed the engagement of Lightfoot Guest Moore & Co., PC
in a Current Report on Form 8-K filed with the SEC on September 22, 2005 (the
"Form 8-K"), which included the following information:

         On June 3, FirstPlus Financial Group, Inc. (the "Company") engaged
Lightfoot Guest Moore & Co., PC as its new independent registered public
accounting firm.

         During the fiscal years ended December 31, 2004 and 2003 and through
June 3, 2005, the Company had not consulted Lightfoot Guest Moore & Co., PC
regarding either (i) the application of accounting principles to a specific
completed or contemplated transaction, or the type of audit opinion that might
be rendered on the Company's financial statements, and neither written nor oral
advice was provided to the Company nor oral advice that was an important factor
considered by the Company in reaching a decision as to the accounting, auditing
or financial reporting issue; or (ii) any manner that was either the subject of
a disagreement or event identified in response to paragraph (a)(1)(iv) of Item
304 of Regulation S-B.

         Status of Financial Reporting

         In January 1999, the Company announced that it would be implementing
new accounting guidance regarding the valuation of its retained interests from
securitization transactions which had been recently provided by the Financial
Accounting Standards Board ("FASB"). FASB issued a draft Special Report ("A
Guide to Implementation of Statement 125 on Accounting for Transfers and
Servicing of Financial Assets and Extinguishments of Liabilities, Questions and
Answers, Second Edition") which was finalized during December 1998. In this
Special Report, FASB concluded that the "cash-out" method of valuing retained
interests should be used to estimate fair value. The SEC Staff announced in
December 1998 that the change to the "cash-out" method should be made by
restatement. Based on this guidance, the Company decided to revise its
methodology for estimating the fair value of certain financial instruments for
each of the fiscal years in the three-year period ended September 30, 1997, the
three-month transition period ended December 31, 1997, and the first three
quarters of the fiscal year ended December 31, 1998. As the Company disclosed in
its Form 10-Q for the quarter ended September 1998, it was expected that the
impact would be material to the results of all prior periods.

         As a result of limited resources and conflicting demands, the Company
has not completed its analysis necessary to complete the restatement. In
addition, the Company has not had the financial resources or personnel to
prepare and file its periodic reports with the SEC. In July 2005, the Company
received a letter from the SEC directing the Company to file all required
reports or become subject to a revocation of registration under the

                                       11
<PAGE>

Securities Exchange Act of 1934. In connection with the shareholders' meeting
described under the heading "--Litigation--Special Meeting," the Company has
obtained audited financial statements it believes to be sufficient to distribute
a proxy statement and solicit proxies for the shareholders' meeting and election
of directors. However, this information alone will not cure the Company's
reporting delinquencies with the SEC. The Company has initiated discussions with
the SEC regarding its compliance issues and has started the process to prepare
its plan to correct any SEC reporting delinquencies.

         Following the settlement of the Class Action described under
"--Litigation--Class Action Securities Litigation" below, the Company began to
analyze the extent of its liabilities and reporting compliance issues. In 2004,
the Company received a small return on its investment in Capital Lending which
allowed it to pay mounting debts and begin becoming compliant with its charter
requirements in the State of Nevada. This also allowed the Company to organize
its financial records in preparation for an audit of its financial statements
for the year ended December 31, 2004, which is an expensive and time consuming
process. Through changes in management and the nature of FPFI's bankruptcy and
litigation filed against the Company, the business records have been scattered.
As a result, gathering the necessary information to complete audited financial
statements has taken more time than anticipated or would be required under other
circumstances. The Company cannot currently estimate when it will complete the
restatement or the delinquent reports for past time periods.

                                       12
<PAGE>

FIRSTPLUS Financial Group, Inc.

ITEM 7.  FINANCIAL STATEMENTS.

<TABLE>
<S>                                                                           <C>
Report of Registered Independent Accounting Firm..............................14

Balance Sheet
 December 31, 2004............................................................15

Statements of Operations
 For the Years Ended December 31, 2004 and 2003...............................16

Statement of Stockholders' Equity
 For the Years Ended December 31,2004 and 2003................................17

Statements of Cash Flows
 For the Years Ended December 31, 2004 and 2003...............................18

Notes to Financial Statements.................................................19
</TABLE>

                                       13
<PAGE>

             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


The Board of Directors and Stockholders
FIRSTPLUS Financial Group, Inc.
Irving, Texas

We have audited the accompanying balance sheet of FIRSTPLUS Financial Group,
Inc. as of December 31, 2004, and the related statements of operations,
stockholders' equity, and cash flows for each of the two years in the period
ended December 31, 2004. These financial statements are the responsibility of
the company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of FIRSTPLUS Financial Group, Inc.
at December 31, 2004 and the results of its operations and its cash flows for
each of the two years in the period ended December 31, 2004 in conformity with
accounting principles generally accepted in the United States of America.

As discussed in Note 2 to the financial statements, the Company effected a
quasi-reorganization in December 2002. In conjunction with the accounting for
the quasi-reorganization, the Company adjusted the recorded value of specific
assets and liabilities to fair value. In addition, as required by
quasi-reorganziation accounting, the Company early adopted Statement of
Financial Accounting Standards ("SFAS) No. 142, "Goodwill and Other Intangible
Assets," SFAS No. 143, "Accounting for Asset Retirement Obligations," SFAS No.
14, "Accounting for the Impairment or Disposal of Long-Lived Assets," SFAS No.
145, "Rescission of FASB Statements No.4, 44 and 64, Amendment to FASB Statement
No. 13, and Technical Corrections" and SFAS No. 146, "Accounting for Costs
Associated with Exit or Disposal Activities".


Dallas, Texas
July 29, 2005


                                       14
<PAGE>

FIRSTPLUS Financial Group, Inc.
--------------------------------------------------------------------------------

BALANCE SHEET

<TABLE>
<CAPTION>
                                                                     December 31,
                                                                         2004
                                                                      ----------
                                    ASSETS:
<S>                                                                   <C>
Cash and cash equivalents                                             $  460,310
                                                                      ----------

Total current assets                                                     460,310

Accounts receivable Capital Lending Strategies, LLC                      160,050
Claim from bankruptcy estate (see note 3)                              4,980,223
Investment in Capital Lending Strategies, LLC                             71,150
                                                                      ----------

Total assets                                                          $5,671,733
                                                                      ==========

                                  LIABILITIES
                           AND STOCKHOLDERS' EQUITY:

Accounts payable                                                      $   29,282
Income taxes payable                                                     112,900
                                                                      ----------

Total current liabilities                                                142,182

Commitments and contingencies                                               --

Stockholders' equity:
Common stock, $.01 par value, 100,000,000 shares
  authorized; 44,340,090 shares issued and outstanding                   443,401
Additional paid in capital                                             4,897,270
Retained earnings since December 31, 2002 when a deficit of
  $312,527,864 was eliminated in connection with a
  quasi-reorganization                                                   188,880
                                                                      ----------

Total stockholders' equity                                             5,529,551

Total liabilities and stockholders' equity                            $5,671,733
                                                                      ==========
</TABLE>

                 See accompanying notes to financial statements

                                       15
<PAGE>

FIRSTPLUS Financial Group, Inc.
--------------------------------------------------------------------------------

STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                         For the Years Ended
                                                            December 31,
                                                        2004            2003
                                                    ------------    ------------
<S>                                                 <C>             <C>
Revenues                                            $       --      $       --

Operating expenses:
  General and administrative                             230,895          84,348
  Other expenses                                          22,350            --
                                                    ------------    ------------

Total operating expenses                                 253,245          84,348
                                                    ------------    ------------

Operating income (loss)                                 (253,245)        (84,348)

Non-operating income:
  Interest, net                                           12,080           8,360
  Loss on loan default                                  (100,000)           --
  Gain on sale of Capital Lending Strategies, LLC        699,333            --
                                                    ------------    ------------

Income (loss) before provision for income taxes          358,168         (75,988)

Provision for income taxes                               104,700         (11,400)
                                                    ------------    ------------

              Net income (loss)                     $    253,468    $    (64,588)
                                                    ============    ============

Earnings (loss) per share                           $       0.01    $      (0.00)
                                                    ============    ============

Weighted average of common shares
  outstanding                                         44,340,064      44,339,815
                                                    ============    ============
</TABLE>

                 See accompanying notes to financial statements

                                       16
<PAGE>

FIRSTPLUS Financial Group, Inc.
--------------------------------------------------------------------------------

STATEMENTS OF STOCKHOLDERS' EQUITY
For the Years Ended December 31, 2004 and 2003

<TABLE>
<CAPTION>
                                                    Number                                                               Total
                                                      of             Common           Paid-in          Retained        Stockholders'
                                                    Shares           Stock            Capital          Earnings           Equity
<S>                                               <C>           <C>               <C>               <C>               <C>
Balance, December 31, 2002 prior to
  quasi-reorganization                            44,338,505    $     443,385     $ 317,425,134     $(312,527,864)    $   5,340,655

Transfer of accumulated deficit to
  additional paid in capital                                                        312,527,864     (312,527,864)             --
                                               -------------    -------------     -------------     -------------     -------------

Balance, December 31, 2002                        44,338,505          443,385         4,897,270              --           5,340,655

Net loss                                                                   --               -             (64,588)          (64,588)
                                               -------------    -------------     -------------     -------------     -------------

Balance, December 31, 2003                        44,338,505          443,385         4,897,270           (64,588)        5,276,067

Issuance of stock on
  conversion of certificated
  interests                                            1,585               16                                                    16

Net income                                                                 --               --            253,468           253,468
                                               -------------    -------------     -------------     -------------     -------------

Balance, December 31, 2004                        44,340,090    $     443,401     $   4,897,270     $     188,880     $   5,529,551
                                               =============    =============     =============     =============     =============
</TABLE>

                 See accompanying notes to financial statements

                                       17
<PAGE>

FIRSTPLUS Financial Group, Inc.
--------------------------------------------------------------------------------

STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                     For the Years Ended
                                                                        December 31,
                                                                      2004         2003
                                                                   ---------    ---------
<S>                                                                <C>          <C>
Cash flow from operating activities:
Net income (loss)                                                  $ 253,468    $ (64,588)
Adjustments to reconcile net income to
  net cash provided (used) by operating activities:
  Gain on sale of investment                                        (699,333)        --
  Loss on loan default                                               100,000         --
Changes in operating assets and liabilities:
  Accounts receivable                                                   --        129,495
  Deferred tax asset                                                  11,400      (11,400)
  Accounts payable                                                   (54,590)        (776)
  Income taxes payable                                                93,300       18,000
                                                                   ---------    ---------
Net cash provided (used) by operating activities                    (295,755)      70,731

Cash flows from investing activities:
  Proceeds from sale of investments                                  796,580         --
  Loans made                                                            --        (62,843)
  Receivable Capital Lending Strategies, LLC                          41,538         --
  Loss on loan default                                              (100,000)        --
  Change in other investments                                          1,603         --
                                                                   ---------    ---------
Net cash provided (used) by investing activities                     739,721      (62,843)

Net increase in cash                                                 443,966        7,888

Cash at the beginning of the year                                     16,344        8,456
                                                                   ---------    ---------

Cash at the end of the year                                        $ 460,310    $  16,344
                                                                   =========    =========

Supplemental disclosure of cash flow information:
Cash paid for:
Interest                                                           $    --      $    --
                                                                   =========    =========
Taxes                                                              $    --      $    --
                                                                   =========    =========
</TABLE>

                 See accompanying notes to financial statements

                                       18
<PAGE>

FIRSTPLUS FINANCIAL GROUP, INC.
Notes to the Financial Statements

1.       Description Of The Company:

FIRSTPLUS Financial Group, Inc. ("FPFG") (together with its subsidiaries, the
"Company") was a specialized consumer finance company that originated,
purchased, serviced and sold consumer finance receivables. The Company's
principal loan product was a debt consolidation or home improvement loan secured
by a second lien on real property ("High LTV Loans"). The Company sold
substantially all of its High LTV Loans through its securitization program and
retained rights to service those loans.

The Company's operations required continued access to financing sources. The
Company's primary operating cash requirements included the funding of (i) loan
originations, (ii) reserve accounts, overcollateralization requirements, fees
and expenses incurred in connection with its securitization transactions, (iii)
television, radio and direct mail advertising and other marketing and (iv)
administrative and other operating expenses.

Due to numerous market factors beyond the Company's control during the fourth
quarter of 1998, the Company's access to those financing sources was
unavailable. As a result, the subsidiaries filed a bankruptcy petition under
Chapter 11 of the Bankruptcy Code. As part of the plan of reorganization
accepted by the bankruptcy court on April 7, 2000, certain creditors of the
subsidiaries received a Certificated Interest representing Obligations under the
plan of reorganization. FPFG also retained an unsecured interest in monies that
it had advanced to its subsidiaries. As payments are made from the former
subsidiaries to FPFG, the Obligations to the Certificated Interests are paid.
The claim was placed in the FirstPlus Financial Grantor Residual Trust. The
bankruptcy estate has established a creditor trust from which available funds
are paid to creditors of FPFG's former subsidiaries. After secured creditors
have been paid, funds are released to pay the Obligations to the Certificated
Interests and to the Grantor Trust.

2.       Summary Of Significant Accounting Policies:

Revenue Recognition:

Revenue and dividends from investments are recognized at the time the investment
dividends are declared payable by the underlying investment. Capital gains and
losses are recorded on the date of sale of the investment.

Cash and Cash Equivalents:

For purposes of the balance sheet and statement of cash flows, the Company
considers all highly liquid investments which are readily convertible into known
amounts of cash and have a maturity of three months or less when acquired to be
cash equivalents. At December 31, 2004, management believes that the carrying
amount of cash equivalents approximates fair value because of the short maturity
of these financial instruments.

Concentration of Credit Risk:

FPFG at times during operations has cash deposits that exceed $100,000 in one
account in individual banks. The Federal Deposit Insurance Corporation (FDIC)
insures only the first $100,000 of funds at member banks. FPFG has not incurred
losses related to its cash.

                                       19
<PAGE>

FIRSTPLUS FINANCIAL GROUP, INC.
Notes to the Financial Statements

2.       Summary Of Significant Accounting Policies: (Continued)

Income Taxes:

In accordance with SFAS No. 109, "Accounting for Income Taxes", deferred income
taxes are recognized for the tax consequences in future years of differences
between the tax basis of assets and liabilities and their financial reporting
amounts at each year-end based on enacted tax laws and statutory tax rates
applicable to the periods in which the differences are expected to affect
taxable income. Valuation allowances are established, when necessary, to reduce
deferred tax assets to the amount expected to be realized. The provision for
income taxes represents the tax payable for the period and the change during the
period in deferred tax assets and liabilities.

Management's Estimates:

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the dates of the financial statements and
the reported amounts of expenses during the reporting periods. Actual results
could differ from those estimates.

Quasi-reorganization:

The Company Board approved a plan to affect a quasi-reorganization effective
December 31, 2002. A quasi-reorganization is an accounting procedure that
eliminates an accumulated deficit in retained earnings and permits a company to
proceed on much the same basis as if it had been legally reorganized. A
quasi-reorganization involves adjusting a company's assets and liabilities to
their fair values. Any remaining deficit in retained earnings is then eliminated
by a transfer of amounts from paid-in capital and capital stock, if necessary,
giving a company a "fresh start" and a zero balance in retained earnings.

3.       Other Assets

FPFG retains a claim against the bankruptcy estate of its former subsidiaries
for monies advanced to them. The bankruptcy trustee has set aside $7,880,207
designated for partial payment of that claim. FPFG, nor the bankruptcy trustee,
can estimate the amount or timing of any future payments. FPFG has booked a
valuation reserve of $2,900,000 against the amount set aside for potential
creditor claims against FPFG.

FPFG owns a minority equity interest in Capital Lending Strategies, LLC ("CLS").
During 2004, it sold approximately 60% of its holdings in CLS which provided
FPFG's working capital. The investment is recorded on the books at the cost
basis of $71,150.

4.       Contingencies

FPFG has recorded a valuation allowance of $2,900,000 for potential claims
arising from creditors of FPFG and its former subsidiaries. No creditors have
initiated a claim against FPFG. FPFG has recorded an allowance since any claim
would be dependent on the receipt of funds from the bankruptcy estate of FPFG's
former subsidiaries.

                                       20
<PAGE>

FIRSTPLUS FINANCIAL GROUP, INC.
Notes to the Financial Statements

5.       Stockholders' Equity

Holders of the Company's 7.25% Convertible Subordinated Notes Due 2003
(discharged under a plan of reorganization under Chapter 11 of the Bankruptcy
Code dated April 7, 2000) received a Certificated Interest payable from residual
funds of the subsidiaries after the secured interests have been paid. Two of the
former noteholders received rights to convert a portion of their Certificated
Interests into shares of the FPFG's common stock. At December 31, 2004,
Certificated Interests held conversion rights to 4,079,356 shares of common
stock. (See note 9).

6.       Director Stock Option Plan

The Company has stock options outstanding to participants under the 1995
Non-Employee Director Plan to grant options to members of the Board of Directors
who are not employees of the Company or its subsidiaries on the date they become
a director. No options under the 1995 Employee Option Plan may be exercised more
than ten years from the date of grant.

Each of the four directors holds options for the issuance of 300,000 shares of
common stock for an aggregate total of 1,200,000 shares. The options are
exercisable at $0.10 per option.

7.       Pension Plan

At December 31, 2004, FPFG held $93,285 for the benefit of former employees.
FPFG has enlisted the help of the Internal Revenue Service's Letter Forwarding
Program in order to locate and distribute these funds.

8.       Related Party Transactions

The Company's executive offices are shared with the facilities leased by Capital
Lending Strategies, LLC, which incurs the cost and full responsibility of the
lease. There is no formal agreement between the Company and Capital Lending
Strategies, LLC with respect to the lease arrangement. Daniel T. Phillips,
FPFG's Director, is a Manager and Member of Capital Lending Strategies, LLC.

The Company has loaned to Capital Lending Strategies, LLC approximately
$200,000. The loan balance at December 31, 2004 was $160,050.

In 2003, the Company entered into a "reciprocal swap" with Capital Lending
Strategies, LLC whereby the Company transferred most of its ownership interests
in Capital Lending Strategies, LLC to Capital Lending in exchange for all of the
shares of Series D Convertible Preferred Stock of the Company then owned by
Capital Lending Strategies, LLC, which represented approximately 51% of the
voting stock of the Company. The Company did not transfer back to Capital
Lending Strategies, LLC the ownership interests assigned to the plaintiffs'
co-lead counsel in escrow on behalf of the authorized claimants under the
settlement of the Company's consolidated class action lawsuit styled In re:
FirstPlus Financial Group, Inc. Securities Litigation, Civil Action No.
3:98-CV-2551-M.

                                       21
<PAGE>

FIRSTPLUS FINANCIAL GROUP, INC.
Notes to the Financial Statements

8.       Related Party Transactions (Continued)

Prior to the reciprocal swap, the mutual ownership positions of the Company and
Capital Lending Strategies, LLC resulted in Capital Lending Strategies, LLC
holding a controlling interest in the Company and approximately 12% of the
Company's ownership of Capital Lending Strategies, LLC "attributing back" to
Capital Lending Strategies, LLC. Following the reciprocal swap, the Company
retained the same economic interest in Capital Lending since none of its
ownership interest then "attributed back" to Capital Lending Strategies, LLC via
Capital Lending Strategies, LLC's ownership of Company stock. However, Capital
Lending Strategies, LLC no longer owns any shares of the Company and is no
longer in a position to control the Company through its stock ownership. In May
2004, the Company sold its remaining interest in Capital Lending Strategies,
LLC, other than the interest assigned on behalf of the claimants in the class
action lawsuit, for $796,580.

In August 2004, the Company made a loan of $100,000 to United Lending Partners,
LLC. The original term of the note was for 60 days with an interest rate of 15
percent. The note was renewed twice and became due in February 2005. All of the
outstanding principal amount and accrued interest from December 2004 remains
due. The loan is currently in default. United Lending Partners, LLC is a
subsidiary of Renaissance Acceptance Group, Inc. Daniel T. Phillips, FPFG's
Director, is a director and shareholder of Renaissance Acceptance Group, Inc.

FPFG has an insurance policy with American Financial Services covering its
directors and officers. The total premium for the policy is $59,260. Dexter &
Company was the broker for the policy. John R. Fitzgerald, FPFG's Director, is
Executive Vice President of Dexter & Company.

9.       Subsequent Events

In March 2005, the requirements for handling funds for a terminated pension plan
changed. Any account in excess of $1,000 is now required to be placed in an IRA
account in the employee's name and identification number. Any account under
$1,000 may be turned over to a state's escheat program.

The sole remaining Certificated Interest holder with conversion rights exercised
a portion of their rights of conversion for 1,000,000 shares of common stock in
May 2005.

                                       22
<PAGE>

ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

         The Company has had no disagreements with its certified public
accountants with respect to accounting practices or procedures or financial
disclosure.

ITEM 8A. CONTROLS AND PROCEDURES.

         The Company's management, with the participation of its Principal
Executive Officer and Principal Accounting Officer, has evaluated the
effectiveness of its disclosure controls and procedures (as such term is defined
in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the
"Exchange Act")) as of the end of the period covered by this report. Based on
such evaluation, the Company's Principal Executive Officer and Principal
Accounting Officer have concluded that, as of the end of such period, the
Company's disclosure controls and procedures are effective in recording,
processing, summarizing and reporting, on a timely basis, information required
to be disclosed by the Company in the reports that it files or submits under the
Exchange Act.

         The Company has implemented the following changes in internal control
over financial reporting (as such term is defined in Rules 13a-15(f) and
15d-15(f) under the Exchange Act) during the fiscal quarter to which this report
relates that have materially affected, or are reasonably likely to materially
affect, its internal control over financial reporting. Since 1999, the Company
was essentially a dormant company without sufficient resources to retain an
independent auditor. Prior to 1999, the Company's main operating entity employed
a large accounting staff responsible for the Company's extensive accounting
needs and financial reporting. Prior to its collapse, FPFI's operations were
geographically dispersed and its accounting records had not been centralized in
Dallas. When FPFI filed for bankruptcy protection in 1999, FPFI employees who
maintained the Company's records were inundated with creditor demands for
information. Following FPFI's bankruptcy, virtually all of FPFI's remaining
accounting personnel were laid off. The Company, with its very limited
personnel, attempted to maintain control over its records, but most of those
records remained fragmented or under the control of the FPFI bankruptcy estate.

         In January 2004, the Company attempted to assemble the fragmented
records in an effort to develop a workable set of books and records. The
individuals involved with this endeavor, while not employed by the Company,
volunteered to help and worked diligently to assemble the fragmented records. By
the beginning of 2005, the Company had finally gathered a workable set of books
and records to begin the process of obtaining audited financial statements for
2004 and attempted to gather the books and records necessary to address the
deficiencies in the Company's financial reporting, including its period reports
under the Exchange Act.

ITEM 8B. OTHER INFORMATION.

         None


                                    PART III

ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
         COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT.

         The following table sets forth the name, age and position of each of
the Company's directors and executive officers:

<TABLE>
<CAPTION>
Name                                 Age       Positions and Offices with the Company        Director/Officer Since
----                                 ---       --------------------------------------        ----------------------
<S>                                  <C>       <C>                                                     <C>
Robert P. Freeman                    74        Director and Chairman of the Board                      1998
John R. Fitzgerald                   57        Director                                                1995
Daniel T. Phillips                   56        Director                                                1994
David B. Ward                        65        Director                                                1999
Jack (J.D.) Draper                   51        President and Chief Executive Officer                   2003
</TABLE>

         Robert P. Freeman. Robert P. Freeman has served as a Director since
1998. Mr. Freeman has served as President and founder of Hennessy Freeman
Associates since 1985. His major area of expertise is developing and

                                       23
<PAGE>

implementing customized, interactive Process Management Programs, which he
describes as the best real-world methodology to optimize decision-making,
quality improvement. Previously, Mr. Freeman was Senior Vice President and a
member of the Management Committee at Beneficial Corporation, a $15 billion
diversified financial services firm. Mr. Freeman holds a Bachelor of Science
degree in Marketing and a Master of Business Administration from Rutgers
University. He also completed the Advanced Management Program at Harvard. Mr.
Freeman is also an Adjunct Associate Professor of Management at Fairleigh
Dickinson Graduate School of Business.

         John R. Fitzgerald. John R. Fitzgerald has served as a Director since
1995. Mr. Fitzgerald has been Executive Vice President of Dexter & Company since
1989. Previously, Mr. Fitzgerald served as Account Executive for Corrigan-Jordan
Insurance Agency from 1981 to 1989. From 1970 to 1981, Mr. Fitzgerald played
with the National Football League's Dallas Cowboys, including two Super Bowl
championship teams. He was elected as player representative during contract
negotiations and served on the players association Executive Committee in 1975.
Mr. Fitzgerald earned a Bachelor of Science, Business Administration from Boston
College in 1970. Mr. Fitzgerald has served as speaker and consultant for Xerox
Corporation, Lion Funding Corporation, Equities International, Grand Bank-Dallas
and The Associates Corporation of North America. Mr. Fitzgerald's current and
former professional experience and affiliations include the following:

         o        NFL Alumni Association
                  -        President, Dallas Chapter, 1993
                  -        Member, Board of Directors, 1985 - 1992
         o        Board of Governors, Canyon Creek Country Club, 1990 - 1994
         o        Participant, Muscular Dystrophy Association's Jerry Lewis
                  Telethon
         o        Chairman, Celebrity Selection Committee, PGAS and MDA Golf
                  Tournaments
         o        Board Member, Big Brothers and Big Sisters of Arlington
         o        Consultant, Tournament Committee for Celebrities, Colonial
                  National Invitation PGA Golf Tournament's Pro-Am Tournament

         Daniel T. Phillips. Daniel T. Phillips has served as a Director since
1994. Mr. Phillips is co-founder of FIRSTPLUS Financial Group, Inc. From 1996 to
2003, Mr. Phillips served as Chairman and CEO of FIRSTPLUS, overseeing the
operations of its subsidiaries, which combined had 6,000 employees producing,
securitizing and servicing up to $7.7 billion dollars of loans. Currently, Mr.
Phillips serves as Manager of Capital Lending Strategies, LLC, a position he has
held since 2003. Mr. Phillips has also served as Chairman of the Board of
Renaissance Acceptance Group, Inc. since 2001. From 1993 to 1996, Mr. Phillips
served as President and CEO of RAC Financial Group, Inc., the parent of
FIRSTPLUS Financial Inc., FIRSTPLUS Financial West, Inc., First Security
Mortgage Corporation and State Financial Acceptance Corporation. He is also
former President and CEO of LinCo Financial Corporation and served in the United
States Marine Corps from 1967 to 1970. Mr. Phillips is responsible for the
development of sophisticated risk scorecards for the high loan to value second
mortgage business and in his career he has successfully securitized $9 billion
of business rated by S&P, Moody's and Fitch.

         David B. Ward. David B. Ward has served as a Director since 1999. Mr.
Ward has been a partner of Ward & Gross, a law firm in Flanders, New Jersey,
since 1989. The firm's practice currently emphasizes residential property
purchase and sale closings, and government relations consulting and
representation, primarily in the credit area. The firm handles refinance and
purchase money mortgage closings in New Jersey for corporate and individual
clients. The firm expects to be involved in more than 200 such transactions in
2005. Previously, Mr. Ward was Senior Executive and Attorney for Beneficial
Corporation for 14 years. He served as a member of the Executive Committee, as
Senior Vice President of Government Relations for 12 years, and as Chairman and
CEO of Real Estate operations for several years in the 1980s. Prior to taking
over the Government Relations function, Mr. Ward was counsel to Beneficial's
insurance companies and a member of the corporate legal department. Prior to
joining Beneficial, Mr. Ward practiced law in Pittsburgh, Pennsylvania from 1965
to 1976. Mr. Ward has been Counsel to the New Jersey Financial Services
Association ("NJFSA") since 1989, and was Executive Director from 1994 to 2004.
The NJFSA represents national and local companies engaged in mortgage banking,
secondary mortgage lending, consumer lending, credit insurance and sales finance
activities in New Jersey. Mr. Ward holds a Juris Doctorate from the Dickinson
School of Law and a Bachelor of Arts degree from Harvard College. He also
completed the Harvard School of Business Administration's Advanced Management
Program. Mr. Ward's current and former professional experience and affiliations
include:

                                       24
<PAGE>

         o        Member of New Jersey Department of Banking Advisory Board,
                  1990 - 1996
         o        Member of Federal Reserve Board Consumer Advisory Council,
                  1989 - 1991
         o        Member of American Financial Services Association Law
                  Committee
         o        Member of the New Jersey and American Bar Associations
         o        Military Service: Lt. j.g U.S. Coast Guard, active duty 1966 -
                  1969

         Jack (J.D.) Draper. Mr. Draper has served as President and Chief
Executive Officer since 2003. Mr. Draper is co-founder of FIRSTPLUS Financial,
Inc. and has 25 years of progressive management experience in the mortgage,
second mortgage and property improvement industries. Mr. Draper is recognized as
a compliance specialist in state and federal lending laws. Mr. Draper is skilled
in quality control plan development, fiscal planning and budget administration
and has particular expertise in strategic planning, operations management and
project management. Before being appointed President and CEO of the Company in
2003, Mr. Draper held the following executive leadership positions with
companies in the financial services industry:

         o        President and CEO, LDI Financial Inc., 2002 - 2003
         o        Senior Vice President, 19th Investment Corporation, 2000 -
                  2002
         o        Chief Operating Officer, Heritage Organization/Capital Lending
                  Strategies, LLC, 1999 - 2000
         o        Senior Vice President, PSB Lending Corporation, 1999
         o        President and CEO, LDI Financial Inc., 1996 - 1999
         o        Liquidation Specialist, Federal Deposit Insurance Corporation,
                  1990--1992
         o        Co-Founder-President, SFA: State Financial Acceptance Corp,
                  1989--1993

Audit Committee Financial Expert

         As a small company with limited operations, the Board of Directors does
not believe that it is necessary to actively search for an outside person to
serve on the Board of Directors to qualify as an audit committee financial
expert. The Board of Directors has authority to engage legal counsel, other
experts or consultants as it deems appropriate to carry out its
responsibilities. The Board of Directors includes one individual with varied
experience in the finance industry, including responsibilities for analysis of
financial statements in connection with the financial services industry and as
chief executive officer of public companies in the financial services industry,
and one individual with varied experience in management consulting and as
President of a management consulting firm and has a Masters in Business
Administration degree. The Board of Directors believes all four members of the
Board of Directors have the ability to read and understand financial statements
to perform their duties as Directors. The Board of Directors does not have a
standing audit committee and has not determined whether any of the current
members of the Board meet the definition of audit committee financial expert.
The Company may consider the addition of a Board member in the future meeting
the definition of audit committee financial expert.

Compliance with Section 16(a) of the Exchange Act

         Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors and certain of its officers to send reports of their
ownership of Company common stock and changes in such ownership to the SEC. The
Company assists its directors and officers by preparing forms for filing. SEC
regulations also require the Company to identify in this proxy statement any
person subject to this requirement who failed to file a report on a timely
basis. Based on a review of copies of reports furnished to the Company and
written representations that no reports were required, the Company believes that
all of its directors and officers subject to Section 16(a) complied with the
reporting requirements with respect to transactions during 2004.

Code of Ethics

         The Board of Directors has adopted a Code of Ethics for all directors
and officers which is attached hereto as Exhibit 14.1. The primary goal of the
Code of Ethics is to establish precepts which govern business decisions and to
preserve the integrity by which businesses are created. As the Company continues
to evolve and re-emerge in the financial services industry, the officers and
directors strive to attain the highest possible standards in all aspects of
business activity.

                                       25
<PAGE>

ITEM 10. EXECUTIVE COMPENSATION.

         The following table sets forth the total compensation paid or accrued
by the Company for services rendered during each of the three years ended
December 31, 2004 to the Company's President and Chief Executive Officer,
referenced to in this Proxy Statement as "named executive officers." The Company
does not have an employment agreement with its named executive officers. The
Company does not currently have any other executive officers and had no
executive officers whose compensation exceeded $100,000 in 2004.

<TABLE>
<CAPTION>
                                                Annual Compensation                         Long-Term Compensation
                                  ---------------------------------------------     -----------------------------------
                                                                                        Awards
                                                                                    ---------------
                                                                Other Annual           Securities            All Other
      Name &                                                    Compensation           Underlying          Compensation
Principal Position      Year      Salary ($)     Bonus ($)           (1)              Options/SARS              ($)
<S>                     <C>       <C>                <C>           <C>                      <C>                 <C>
Jack (J.D. Draper       2004      $33,000            --            $7,606(1)                --                  --
  President and         2003        2,500(2)         --                                     --                  --
  Chief Executive
  Officer
</TABLE>

(1)      Consists of $6,606 in premiums paid by the Company for health insurance
         and $1,000 in fees related to Mr. Draper's appointment as trustee of
         the FIRSTPLUS Financial Group, Inc. Grantor Residual Trust.
(2)      Mr. Draper's employment with the Company began in October 2003.

Stock Option/SAR Grants

         There were no grants of stock options or stock appreciation rights made
during the year ended December 31, 2004 to any named executive officer.

Option Exercises and Holdings

         There were no option exercises during 2004 or options held at December
31, 2004 by the named executive officers of the Company.

Director Compensation

         The Company pays its directors $600 for each meeting in which the
director participates. In June 2004, the Company paid each director $3,700
representing accrued and unpaid director fees for previous meetings. The Company
does not pay directors who are also employees of the Company, if any, any
additional compensation for their service as directors, except for the
reimbursement of expenses incurred in attending meetings. Directors may also
receive stock options for their services as directors; however, the issuance of
options to directors was suspended for 2003 and 2004.

                                       26
<PAGE>

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
         RELATED STOCKHOLDER MATTERS.

         The following table sets forth certain information regarding beneficial
ownership of the Company's common stock as of July 28, 2005, by (1) each
director and named executive officer of the Company, (2) all officers and
directors of the Company as a group, and (3) all persons who are known by the
Company to be beneficial owners of 5% or more of the Company's outstanding
common stock. The Company is also aware of an additional purported "committee"
of shareholders who constitute part of the petitioner group in the Election Suit
described in Item 3 of this Form 10-KSB. As of the date of filing of this Form
10-KSB, neither the "committee" nor the petitioner group have filed a Schedule
13D as required by the Securities Exchange Act of 1934.

<TABLE>
<CAPTION>
Name and Address of Beneficial Owner                                Shares Owned              Percent of Class(1)
------------------------------------                                ------------              -------------------
<S>                                                                 <C>                             <C>
Daniel T. Phillips                                                    350,000(2)                    *

Robert P. Freeman                                                     337,000(3)                    *

John R. Fitzgerald                                                    313,724(4)                    *

David B. Ward                                                         300,000(5)                    *

Jack (J.D.) Draper                                                         --                        --

FPFX Shareholder Value Committee(6)                                 4,800,155(6)                    10.6%

All directors and officers as a group (5 persons) (2)(3)(4)(5)      1,300,724                        2.8%
</TABLE>

*        Indicates less than one percent (1%).

(1)      The percentage of ownership is based on 45,340,090 shares of
         common stock outstanding as of July 28, 2005. Except as otherwise
         indicated, the persons named in the table possess sole voting and
         investment power with respect to all shares of common stock shown as
         beneficially owned by them. Beneficial ownership as reported in the
         above table has been determined according to Rule 13d-3 of the
         Securities Exchange Act of 1934, as amended (the "Exchange Act"). The
         amounts shown in the table include shares of common stock issuable upon
         exercise of outstanding options exercisable within 60 days of July 28,
         2005. Except as otherwise noted, the address of the named individuals
         is 5100 N. O'Connor Boulevard, 6th Floor, Irving, Texas 75039.
(2)      Consists of 50,000 shares of common stock held by Phillips Partners,
         Ltd., over which Mr. Phillips has voting and dispositive control, and
         300,000 shares of common stock issuable upon the exercise of options.
(3)      Includes 300,000 shares of common stock issuable upon the exercise of
         options.
(4)      Includes 324 shares of common stock held by Mr. Fitzgerald's wife and
         300,000 shares of common stock issuable upon the exercise of options.
(5)      Consists of 300,000 shares of common stock issuable upon the exercise
         of options.
(6)      The purported "committee" is in no way affiliated with the Company.
         According to Schedule 13D, filed on August 26, 2005. Consists of (i)
         11,297 shares of common stock held by James T. Capretz, (ii) 265,699
         shares of common stock held by Robert D. Davis, (iii) 210,759 shares of
         common stock held by George R. Ebertings, (iv) 2,039,900 shares of
         common stock held by Rupan Gulenyan, (v) 430,000 shares of common stock
         held or controlled by James P. Hanson, and (vi) 1,842,500 shares of
         common stock held by Danford C. Martin. The address of the "committee"
         is 7 Egret Lane, Aliso Viejo, California 92656.

                                       27
<PAGE>

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

            The Company's executive offices are shared with the facilities
leased by Capital Lending, which incurs the cost and full responsibility of the
lease. There is no formal agreement between the Company and Capital Lending with
respect to the lease arrangement. The Company has outstanding loans to Capital
Lending in an outstanding amount of $160,050. The loans are not documented by a
formal agreement. Daniel T. Phillips, our Director, is a Manager and Member of
Capital Lending.

            In June 2002, Capital Lending acquired 25,639 shares of the
Company's Series D Convertible Preferred Stock (the "Series D Preferred"). The
sale of Series D Preferred to Capital Lending was unanimously approved by the
Board of Directors of the Company, with the exception of Daniel T. Phillips,
then Chairman and Chief Executive Officer of the Company, who abstained from the
vote because of his affiliation with Capital Lending. As a result of the
transaction, Capital Lending acquired control of the Company and held
approximately 51% of the outstanding voting securities of the Company. In
connection with the transaction, the Company agreed to expand its Board of
Directors to seven members. Consequently, George T. Davis, a significant
shareholder of the Company became a member of the Board of Directors and agreed
to serve as Vice President--Investor Relations for the Company. The Company
acquired 42.3% of the outstanding limited liability company interests for shares
of Series D Preferred acquired by Capital Lending.

            In August 2001, the Company invested seed capital for a one-third
profits interest in Capital Lending. In connection with the above described
transaction, the profits interest was converted to an equity interest in Capital
Lending. Mr. Phillips provided consulting advice and direction to Capital
Lending in connection with its formation and development and, for such services,
an affiliate of Mr. Phillips received a one-third profits interest in Capital
Lending. As a result of the transaction, and after accounting for certain
employee interests, the Company held a 40.2% equity interest in Capital Lending.

            The terms of the Series D Preferred provided that neither Capital
Lending, nor any of its affiliates or assigns, would be entitled to any of the
Company's rights in the cash flow from the derivative interests in
mortgage-backed or asset-backed securitization transactions of FPFI, which had
been set aside for the benefit of the Company's shareholders and creditors in
the Grantor Trust. The beneficiary of the Grantor Trust is the Company, with its
shareholders' and creditors' rights recognized through their status as
Designated Recipients under the Grantor Trust, but excluded Capital Lending and
its affiliates and assigns. George T. Davis was appointed as the initial trustee
of the Grantor Trust.

            In 2003, the Company entered into a "reciprocal swap" with Capital
Lending whereby the Company transferred most of its ownership interests in
Capital Lending to Capital Lending in exchange for all of the shares of Series D
Convertible Preferred Stock of the Company then owned by Capital Lending, which
represented approximately 51% of the voting stock of the Company. The Company
did not transfer back to Capital Lending the ownership interests assigned to the
plaintiffs' co-lead counsel in escrow on behalf of the authorized claimants
under the settlement of the Company's consolidated class action lawsuit styled
In re: FirstPlus Financial Group, Inc. Securities Litigation, Civil Action No.
3:98-CV-2551-M.

            Prior to the reciprocal swap, the mutual ownership positions of the
Company and Capital Lending resulted in Capital Lending holding a controlling
interest in the Company and approximately 12% of the Company's ownership of
Capital Lending "attributing back" to Capital Lending. Following the reciprocal
swap, the Company retained the same economic interest in Capital Lending since
none of its ownership interest then "attributed back" to Capital Lending via
Capital Lending's ownership of Company stock. However, Capital Lending no longer
owns any shares of the Company and is no longer in a position to control the
Company through its stock ownership. In May 2004, the Company sold its remaining
interest in Capital Lending, other than the interest assigned on behalf of the
claimants in the class action lawsuit, for $796,580.

            In May 2004, the Company reimbursed United Lending Partners an
amount of $37,681.18 for payments United Lending Partners made on behalf of the
Company to the Company's stock transfer agent. In August 2004, the Company made
a loan of $100,000 to United Lending Partners. The original term of the note was
for 60 days with an interest rate of 15 percent. The note was renewed twice and
became due in February 2005. All of the outstanding principal amount and accrued
interest from December 2004 remains due. The loan is currently in

                                       28
<PAGE>

default. United Lending Partners is a subsidiary of Renaissance Acceptance
Group, Inc. Daniel T. Phillips, our Director, is a director and shareholder of
Renaissance Acceptance Group, Inc.

            The Company has a insurance policy with American Financial Services
covering its directors and officers. The total premium for the policy is
$59,260. Dexter & Company was the broker for the policy. John R. Fitzgerald, our
Director, is Executive Vice President of Dexter & Company.

ITEM 13. EXHIBITS.

            The exhibits listed on the accompanying Exhibit Index are filed as
part of this Report.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

Audit Fees

         The following table sets forth fees billed to us during the fiscal
years ended December 31, 2004 and 2003 by our independent auditors:

<TABLE>
<CAPTION>
                                                      December 31, 2004        December 31, 2003
                                                      -----------------        -----------------
         <S>      <C>                                      <C>                        <C>
         (i)      Audit Fees                               $     0                    $0
         (ii)     Audit Related Fees                       $     0                    $0
         (iii)    Tax Fees                                 $     0                    $0
         (iv)     All Other Fees                           $15,046                    $0
</TABLE>

         Audit Fees. Consists of fees billed for professional services rendered
for the audit of the Company's financial statements and review of the interim
consolidated financial statements included in quarterly reports and services
that are normally provided by our auditors in connection with statutory and
regulatory filings or engagements.

         Audit-Related Fees. Consists of fees billed for assurance and related
services that are reasonably related to the performance of the audit or review
of the Company's financial statements and are not reported under "Audit Fees."

         Tax Fees. Consists of fees billed for professional services for tax
compliance, tax advice and tax planning. There were no tax services provided in
fiscal 2004 or 2003.

         All Other Fees. Consists of fees for products and services other than
the services reported above. There were no management consulting services
provided in fiscal 2004 or 2003.

Policy on Pre-Approval of Audit and Permissible Non-Audit Services of
Independent Auditors

         The Board of Directors' policy is that the Company's auditor performs
its services independently and with the highest integrity and professionalism.
There is no formal written policy. Any engagement of the Company's outside
auditor must be consistent with principles determined by the SEC, namely, that
the independent auditor cannot audit its own work, perform management functions
or act as an advocate for the client.

         The Company currently does not have a designated Audit Committee, and
accordingly, the Company's Board of Directors' policy is to pre-approve all
audit and permissible non-audit services provided by the independent auditors.
These services may include audit services, audit-related services, tax services
and other services. Pre-approval is generally provided for up to one year and
any pre-approval is detailed as to the particular service or category of
services and is generally subject to a specific budget. The independent auditors
and management are required to periodically report to the Company's Board of
Directors regarding the extent of services provided by the independent auditors
in accordance with this pre-approval, and the fees for the services performed to
date. The Board of Directors may also pre-approve particular services on a
case-by-case basis.

                                       29
<PAGE>

                                   SIGNATURES

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

Date:  September 19, 2005                      FIRSTPLUS Financial Group, Inc.
                                               (Registrant)

                                               By /s/ Jack (J.D.) Draper
                                                  ------------------------------
                                                  Jack (J.D.) Draper, President


         In accordance with the Exchange Act, this report has been signed by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.

<TABLE>
<CAPTION>
Signature                                Title                                  Date
---------                                -----                                  ----
<S>                                      <C>                                    <C>
/s/ Robert P. Freeman                    Director and Chairman of the Board     September 19, 2005
------------------------------------
Robert P. Freeman


/s/ Jack (J.D.) Draper                   President and Chief Executive          September 19, 2005
------------------------------------     Officer (Principal Executive and
Jack (J.D.) Draper                       Accounting Officer)


/s/ John R. Fitzgerald                   Director                               September 22, 2005
------------------------------------
John R. Fitzgerald


                                         Director
------------------------------------
Daniel T. Phillips


/s/ David B. Ward                        Director                               September 18, 2005
---------------------------
David B. Ward
</TABLE>

<PAGE>

                                INDEX TO EXHIBITS

<TABLE>
<CAPTION>
Exhibit No.            Document Description
-----------            --------------------
 <S>                   <C>
  2.1                  Modified Third Amended Plan of Reorganization of FirstPlus Financial, Inc.
  2.2                  Trust Agreement for the FPFI Creditor Trust
  3.1                  Amended and Restated Articles of Incorporation, as amended
  3.2                  Second Amended and Restated Bylaws
  4.1                  Rights Agreement dated as of May 20, 1998, between FIRSTPLUS Financial Group, Inc. and
                       ChaseMellon Shareholder Services, L.L.C., which includes the form of Certificate of
                       Designation for Designating Series C Junior Participating Preferred Stock, $1.00 par
                       value, as Exhibit A, the form of Right Certificate as Exhibit B, and the Summary of
                       Rights as Exhibit C. (Incorporated by reference to Exhibit 4.1 of the Company's Form
                       8-K filed as of May 29, 1998.)
  4.1.1                First Amendment to Rights Agreement dated as of October 25, 2001, between FIRSTPLUS
                       Financial Group, Inc. and Mellon Investor Services LLC
  4.1.2                Second Amendment to Rights Agreement dated as of June 27, 2002, between FIRSTPLUS
                       Financial Group, Inc. and Mellon Investor Services LLC
  4.2                  Form of Certificate of Designation for Designating Series C Junior Participating
                       Preferred Stock, $1.00 par value (included as Exhibit A to the Rights Agreement, which
                       is Exhibit 4.1 hereto)
  4.3                  Form of Right Certificate (included as Exhibit B to the Rights Agreement, which is
                       Exhibit 4.1 hereto). Pursuant to the Rights Agreement, printed Right Certificates will
                       not be mailed until as soon as practicable after the Distribution Date
  4.4                  Form of Summary of Rights (included as Exhibit C to the Rights Agreement, which is
                       Exhibit 4.1 hereto) that, together with certificates representing the outstanding
                       Common Shares of the Company, shall represent the Rights until the Distribution Date
  4.5                  Specimen of legend to be placed, pursuant to Section 3(c) of the Rights Agreement, on
                       all new Common Share certificates issued after June 1, 1998 and prior to the
                       Distribution Date upon transfer, exchange or new issuance (included in Section 3(c) of
                       the Rights Agreement, which is Exhibit 4.1 hereto)
  4.6                  FIRSTPLUS Financial Group, Inc. Grantor Residual Trust Agreement, dated July 15, 2002
  4.7                  Supplemental Indenture, dated as of December 4, 2000, by and between FirstPlus
                       Financial Group, Inc. and HSBC Bank USA
  4.8                  Form of Certificate of Certificated Interests Representing Beneficial Interests in The
                       FPFI Creditor Trust Exchanged For 7.25% Convertible Subordinated Notes Due 2003
 10.1                  Agreement for Settlement Between Bear Stearns & Co., Inc. and FirstPlus Financial
                       Group, Inc., dated August 19, 1999.
 10.2                  Conversion Agreement, dated as of June __, 2001, by and between FirstPlus Financial
                       Group, Inc., and the Certificateholders signatory thereto
 10.3                  Letter Agreement, dated June 13, 2001, by FirstPlus Financial Group, Inc. and accepted
                       by FPFI Creditors Trust
 10.4                  Stipulation and Agreement of Settlement, dated as of July 30, 2003, between Class
                       Representative Edward P. Doremus, III, Milberg Weiss Bershad Hynes & Lerach LLP,
                       Sirota & Sirota LLP, FirstPlus Financial Group, Inc., Daniel T. Phillips, Eric C.
                       Green, Haynes and Boone, LLP and National Union Fire Insurance Company of Pittsburgh,
                       PA
 10.5                  Escrow Agreement, dated as of July 30, 2003, by and among FirstPlus Financial Group,
                       Inc., Class Representative Edward P. Doremus, III, Milberg Weiss Bershad Hynes &
                       Lerach LLP and Sirota & Sirota LLP
 10.6                  Assignment and Assumption Agreement, dated as of July 30, 2003, by and between
                       FirstPlus Financial Group, Inc., Class Representative Edward P. Doremus, III, Milberg
                       Weiss Bershad Hynes & Lerach LLP and Sirota & Sirota LLP
 10.7                  Registration Rights Agreement, dated as of July 30, 2003, by and among FirstPlus
                       Financial Group, Inc., Capital Lending Strategies, LLC, Class Representative Edward P.
</TABLE>

<PAGE>

<TABLE>
 <S>                   <C>
                       Doremus, III, Milberg Weiss Bershad Hynes & Lerach LLP and Sirota & Sirota LLP
 10.8                  Promissory Note, dated December 20, 2004, by United Lending Partners, LP in favor of
                       FirstPlus Financial
 10.9                  Subordination Agreement, dated December 30, 2004, by and between FirstPlus Financial
                       Group, Inc. and United Lending Partners, LP
 10.10                 Settlement Agreement and Mutual Release of Any and All Claims, dated October 12, 2001,
                       by Thaxton Investment Corporation and FirstPlus Financial Group, Inc.
 14.1                  FirstPlus Financial Group, Inc. Code of Ethics
 21.1                  List of Subsidiaries
 31.1                  Certification of Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a)
 31.2                  Certification of Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a)
 32.1                  Certification of Jack (J.D.) Draper pursuant to Section 906 of the Sarbanes-Oxley Act
                       of 2002
 32.2                  Certification of Jack (J.D.) Draper pursuant to Section 906 of the Sarbanes-Oxley Act
                       of 2002
</TABLE>