|Investors Capital Holdings, Ltd. report on form
  10-Q
|------------------------------------------------------



|Quarter
      Ended 12/31/07
|----------------------------



|UNITED
      STATESSECURITIES AND EXCHANGE
COMMISSION
|-----------------------------------------------------



|Washington, D.C. 20549
|----------------------



|FORM
      10-Q
|---------------

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)



|OF THE
      SECURITIES EXCHANGE ACT OF 1934
|--------------------------------------------



|For the
      quarterly period ended December 31, 2007
|------------------------------------------------------



|Commission
      File Number: 1-16349
|-------------------------------------



|INVESTORS
      CAPITAL HOLDINGS, LTD.(Exact name of
      registrant as specified in its charter)
|--------------------------------------------------------------------------------------------------



DELAWARE
      (State or other jurisdiction of
      incorporation or organization)
    
    
    
    04-3284631
      (I.R.S. Employer
      Identification No.)




|230 Broadway
      E.Lynnfield, Massachusetts 01940(Address of
      principal executive offices)
|-------------------------------------------------------------------------------------------------



|(781)
      593-8565
|--------------------



|(Registrant's
      telephone number, including area code)
|----------------------------------------------------------

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]

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

Number of shares outstanding of our only class of common stock as of
February 11, 2008:



|6,289,230
|---------

Page 1

---



|Investors Capital Holdings, Ltd. report on form
  10-Q
|------------------------------------------------------



|Quarter
      Ended 12/31/07
|----------------------------

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



| | Table of Contents
| | -----------------



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

FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK ITEM
4. CONTROLS AND PROCEDURES

PART II

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



|OTHER INFORMATIONITEM 1. LEGAL
      PROCEEDINGSITEM 6.
      EXHIBITSSIGNATURES
|--------------------------------------------------------------------------------

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

Page 2

---



|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------

|        |  | PART I               |  | FINANCIAL INFORMATION |  | 
|------- |  | -------------------- |  | --------------------- |  | 
|       
|ITEM 1. |  | FINANCIAL STATEMENTS |  |                       |  | 

INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

|                                                                                        |  | December 31, |  | March 31,   
|--------------------------------------------------------------------------------------- |  | ------------ |  | ------------
|                                                                                        |  | 2007         |  | 2007        
|                                                                                        |  |              |  |             
|Assets:                                                                                 |  |              |  |             
|                                                                                       
|Current Assets                                                                          |  |              |  |             
|                                                                                       
|Cash and cash equivalents                                                               |  | $ 5,535,941  |  | $ 5,498,259 
|Deposit with clearing organization, restricted                                          |  | 175,000      |  | 175,000     
|Accounts receivable                                                                     |  | 4,440,530    |  | 4,336,234   
|Note receivable (current)                                                               |  | 8,702        |  | 8,561       
|Loans receivable from registered representatives (current)                              |  | 551,435      |  | 470,492     
|Prepaid income taxes                                                                    |  | 766,906      |  | 35,078      
|Marketable securities, at market value                                                  |  | 246,815      |  | 206,530     
|Investments (short term)                                                                |  | 1,246,856    |  | 745,315     
|Prepaid expenses                                                                        |  | 511,707      |  | 482,882     
|                                                                                        |  |              |  |             
|Total Current Assets                                                                    |  | 13,483,892   |  | 11,958,351  
|                                                                                       
|Property and equipment, net                                                             |  | 1,344,519    |  | 1,396,793   
|                                                                                       
|Long Term Investments                                                                   |  |              |  |             
|Loans receivable from registered representatives                                        |  | 268,322      |  | 191,305     
|Note receivable                                                                         |  | 747,617      |  | 747,617     
|Equity investments, at cost                                                             |  | 190,000      |  | 190,000     
|Investments                                                                             |  | 185,638      |  | 1,169,606   
|Cash surrender value life insurance policies                                            |  | 353,787      |  | 275,201     
|                                                                                        |  |              |  |             
|                                                                                        |  | 1,745,364    |  | 2,573,729   
|Other Assets                                                                            |  |              |  |             
|Other assets                                                                            |  | 64,346       |  | 72,199      
|Deferred tax asset, net                                                                 |  | 827,628      |  | 889,128     
|                                                                                        |  |              |  |             
|                                                                                        |  | 891,974      |  | 961,327     
|                                                                                       
|Total Assets                                                                            |  | $ 17,465,749 |  | $ 16,890,200
|                                                                                        |  |              |  |             
|                                                                                       
|Liabilities and Stockholders' Equity:                                                   |  |              |  |             
|                                                                                       
|Current Liabilities                                                                     |  |              |  |             
|                                                                                       
|Accounts payable                                                                        |  | $ 1,071,955  |  | $ 773,636   
|Accrued expenses                                                                        |  | 736,729      |  | 1,871,694   
|Notes payable                                                                           |  | -            |  | 838,358     
|Unearned revenues                                                                       |  | 1,635,708    |  | 100,363     
|Commissions payable                                                                     |  | 2,675,935    |  | 3,049,900   
|Securities sold, not yet purchased, at market value                                     |  | 4,384        |  | 711         
|                                                                                        |  |              |  |             
|Total Current Liabilities                                                               |  | 6,124,711    |  | 6,634,662   
|                                                                                       
|Total Liabilities                                                                       |  | 6,124,711    |  | 6,634,662   
|                                                                                        |  |              |  |             
|                                                                                       
|                                                                                       
|                                                                                       
|Stockholders' Equity:                                                                   |  |              |  |             
|                                                                                       
|Common stock, $.01 par value, 10,000,000 shares authorized;                             |  |              |  |             
|6,293,115 issued and 6,289,230 outstanding at December 31,2007;                         |  |              |  |             
|6,209,421 issued and 6,205,536 outstanding at March 31, 2007 .                          |  | 62,931       |  | 62,094      
|Additional paid-in capital                                                              |  | 10,023,410   |  | 9,721,749   
|Retained earnings                                                                       |  | 1,246,343    |  | 468,506     
|less: Treasury stock, 3,885 shares at cost                                              |  | (30,135)     |  | (30,135)    
|Accumulated other comprehensive income                                                  |  | 38,489       |  | 33,324      
|                                                                                        |  |              |  |             
|                                                                                       
|                                                                                       
|Total Stockholders' Equity                                                              |  | 11,341,038   |  | 10,255,538  
|                                                                                       
|Total Liabilities and Stockholders'                                                     |  |              |  |             
|Equity                                                                                  |  | $ 17,465,749 |  | $ 16,890,200
|                                                                                        |  |              |  |             
|                                                                                       
|The accompanying notes are an integral part of these consolidated financial statements. |  |              |  |             

Page 3

---



|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------

INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

THREE MONTHS ENDED DECEMBER 31, 2007 AND 2006 (UNAUDITED)

|                                                          | Three Months Ended
|--------------------------------------------------------- | ------------------
|                                                          | December 31,      
|                                                          | 2007              
|                                                          |                   
|Revenues                                                  |                   
|                                                         
|Commission                                                | $ 19,552,008      
|Advisory fees                                             | 2,752,804         
|Other fee income                                          | 421,439           
|Marketing revenue                                         | 314,444           
|Other income                                              | 230,261           
|                                                          |                   
|Total Revenue                                             | 23,270,956        
|Commission and advisory fees expenses                     | 18,190,813        
|                                                          |                   
|Gross Profit                                              | 5,080,143         
|                                                          |                   
|Operating Expenses:                                       |                   
|Advertising                                               | 460,114           
|Communications                                            | 197,344           
|                                                          |                   
|Total Selling Expenses                                    | 657,458           
|                                                          |                   
|                                                         
|Compensation and benefits                                 | 3,124,694         
|Regulatory, legal and professional                        | 573,941           
|Occupancy                                                 | 282,158           
|Other administrative expenses                             | 302,155           
|Interest expense                                          | 3,931             
|                                                          |                   
|Total Administrative Expenses                             | 4,286,879         
|                                                          |                   
|Total Operating Expenses                                  | 4,944,337         
|                                                          |                   
|Operating Income (Loss)                                   | 135,806           
|                                                          |                   
|                                                         
|Income (loss) before taxes                                | 135,806           
|Provision (benefit) for income taxes                      | 83,585            
|                                                          |                   
|Net Income (Loss)                                         | $ 52,221          
|                                                          |                   
|                                                         
|Earnings Per Common Share:                                |                   
|Basic earnings per common share                           | $0.01             
|Diluted earnings per common share                         | $0.01             
|                                                          |                   
|                                                         
|Share Data:                                               |                   
|Weighted average shares used in basic earnings per        |                   
|common share calculations                                 | 6,082,548         
|Incremental shares from assumed exercise of stock options | 379,842           
|                                                          |                   
|Weighted average shares used in diluted earnings per      |                   
|common share calculations                                 | 6,462,390         
|                                                          |                   
|See Notes to Condensed Consolidated Financial Statements. |                   

Page 4

---



|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------

INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

NINE MONTHS ENDED DECEMBER 31, 2007 AND 2006



|(UNAUDITED)
|-----------

|                                                          |              | Nine Months Ended
|--------------------------------------------------------- | ------------ | -----------------
|                                                          |              | December 31,     
|                                                          |              | 2007             
|                                                          |              |                  
|Revenues                                                  |              |                  
|Commission                                                | $ 59,227,984 | $ 50,730,928     
|Advisory fees                                             |              | 7,459,340        
|Other fee income                                          |              | 694,399          
|Marketing revenue                                         |              | 1,043,808        
|Other income                                              |              | 679,424          
|                                                          |              |                  
|Total Revenue                                             |              | 69,104,955       
|Commission and advisory fees expenses                     |              | 55,343,761       
|                                                          |              |                  
|Gross Profit                                              |              | 13,761,194       
|                                                          |              |                  
|Operating Expenses:                                       |              |                  
|Advertising                                               |              | 1,155,808        
|Communications                                            |              | 712,370          
|                                                          |              |                  
|Total Selling Expenses                                    |              | 1,868,178        
|                                                          |              |                  
|                                                         
|Compensation and benefits                                 |              | 7,181,897        
|Regulatory, legal and professional                        |              | 1,500,833        
|Occupancy                                                 |              | 877,545          
|Other administrative expenses                             |              | 876,838          
|Interest expense                                          |              | 38,147           
|                                                          |              |                  
|Total Administrative Expenses                             |              | 10,475,260       
|                                                          |              |                  
|Total Operating Expenses                                  |              | 12,343,438       
|                                                          |              |                  
|Operating Income (Loss)                                   |              | 1,417,756        
|                                                          |              |                  
|Income (loss) before taxes                                |              | 1,417,756        
|Provision (Benefit) for income taxes                      |              | 639,919          
|                                                          |              |                  
|Net Income (Loss)                                         | $ 777,837    | $ (1,088,386)    
|                                                          |              |                  
|                                                         
|Earnings Per Common Share:                                |              |                  
|Basic earnings per common share                           |              | $0.13            
|Diluted earnings per common share                         |              | $0.12            
|                                                          |              |                  
|                                                         
|Share Data:                                               |              |                  
|Weighted average shares used in basic earnings per        |              |                  
|common share calculations                                 |              | 6,072,088        
|Incremental shares from assumed exercise of stock options |              | 390,426          
|                                                          |              |                  
|Weighted average shares used in diluted earnings per      |              |                  
|common share calculations                                 |              | 6,462,514        
|                                                          |              |                  
|See Notes to Condensed Consolidated Financial Statements. |              |                  

Page 5

---



|Investors Capital Holdings, Ltd. report on form
  10-Q
|------------------------------------------------------



|Quarter
      Ended 12/31/07
|----------------------------

INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS'
EQUITY



|NINE MONTHS
      ENDED DECEMBER 31, 2007 AND 2006(UNAUDITED)
|-------------------------------------------------------------

|                                                                |  | Common    |  | Amount         |  | Additional         |  | Comprehensive |  | Retained          |  | Treasury         |  | Accumulated         |  |                   
|--------------------------------------------------------------- |  | --------- |  | -------------- |  | ------------------ |  | ------------- |  | ----------------- |  | ---------------- |  | ------------------- |  | ------------------
|                                                                |  | Stock     |  |                |  | Paid-In            |  | Income        |  | Earnings          |  | Stock            |  | Other               |  |                   
|                                                                |  | Shares    |  |                |  | Capital            |  |               |  | (Deficit)         |  |                  |  | Comprehensive       |  | Total             
|                                                                |  |           |  |                |  |                    |  |               |  |                   |  |                  |  | Income
      (Loss) |  |                   
|                                                                |  |           |  |                |  |                    |  |               |  |                   |  |                  |  |                     |  |                   
|Balance at
      April 01, 2006                                 |  | 5,794,246 |  | $
      57,942 |  | $
      8,740,780  |  | -             |  | $
      1,797,789 |  | $
      (30,135) |  | $
      19,707      |  | $
      10,586,083
|Stock based
      compensation                                  |  | 394,992   |  | 3,950          |  | 870,723            |  |               |  |                   |  |                  |  |                     |  | 874,673           
|Comprehensive
      income:                                     |  |           |  |                |  |                    |  |               |  |                   |  |                  |  |                     |  |                   
|Net
      (loss)                                                |  |           |  |                |  |                    |  | (1,088,386)   |  | (1,088,386)       |  |                  |  |                     |  |                   
|Other
      Comprehensive Income:                               |  |           |  |                |  |                    |  |               |  |                   |  |                  |  |                     |  |                   
|Unrealized
      gain on securities:                            |  |           |  |                |  |                    |  |               |  |                   |  |                  |  |                     |  |                   
|Unrealized
      holding gains arising                          |  |           |  |                |  |                    |  |               |  |                   |  |                  |  |                     |  |                   
|during period
      no tax effect                               |  |           |  |                |  |                    |  | 8,003         |  |                   |  |                  |  |                     |  |                   
|No
      reclassification adjustment required                   |  |           |  |                |  |                    |  | -             |  |                   |  |                  |  |                     |  |                   
|                                                                |  |           |  |                |  |                    |  |               |  |                   |  |                  |  |                     |  |                   
|Other
      Comprehensive Income                                |  |           |  |                |  |                    |  | 8,003         |  |                   |  |                  |  | 8,003               |  |                   
|                                                                |  |           |  |                |  |                    |  |               |  |                   |  |                  |  |                     |  |                   
|Comprehensive
      Income                                      |  |           |  |                |  |                    |  | (1,080,383)   |  |                   |  |                  |  |                     |  | (1,080,383)       
|                                                                |  |           |  |                |  |                    |  |               |  |                   |  |                  |  |                     |  |                   
|Dividend
      payment to shareholders                          |  |           |  |                |  |                    |  |               |  | (245,218)         |  |                  |  |                     |  | (245,218)         
|                                                                |  |           |  |                |  |                    |  |               |  |                   |  |                  |  |                     |  |                   
|Balance at
      December 31, 2006                              |  | 6,189,238 |  | $
      61,892 |  | $
      9,611,503  |  | -             |  | $
      464,185   |  | $
      (30,135) |  | $
      27,710      |  | $
      10,135,155
|                                                                |  |           |  |                |  |                    |  |               |  |                   |  |                  |  |                     |  |                   
|Balance at
      April 01, 2007                                 |  | 6,209,421 |  | $
      62,094 |  | $
      9,721,749  |  | -             |  | $
      468,506   |  | $
      (30,135) |  | $
      33,324      |  | $
      10,255,538
|                                                                |  |           |  |                |  |                    |  |               |  |                   |  |                  |  |                     |  |                   
|Stock based
      compensation                                  |  | 83,694    |  | 837            |  | 301,661            |  |               |  |                   |  |                  |  |                     |  | 302,498           
|Comprehensive
      income:                                     |  |           |  |                |  |                    |  |               |  |                   |  |                  |  |                     |  |                   
|Net
      income                                                |  |           |  |                |  |                    |  | 777,837       |  | 777,837           |  |                  |  |                     |  |                   
|Other
      Comprehensive Income:                               |  |           |  |                |  |                    |  |               |  |                   |  |                  |  |                     |  |                   
|Unrealized
      gain on securities:                            |  |           |  |                |  |                    |  |               |  |                   |  |                  |  |                     |  |                   
|Unrealized
      holding gains arising                          |  |           |  |                |  |                    |  |               |  |                   |  |                  |  |                     |  |                   
|during period
      no tax effect                               |  |           |  |                |  |                    |  | 5,165         |  |                   |  |                  |  |                     |  |                   
|No
      reclassification adjustment required                   |  |           |  |                |  |                    |  | -             |  |                   |  |                  |  |                     |  |                   
|                                                                |  |           |  |                |  |                    |  |               |  |                   |  |                  |  |                     |  |                   
|Other
      Comprehensive Income                                |  |           |  |                |  |                    |  | 5,165         |  |                   |  |                  |  | 5,165               |  |                   
|                                                                |  |           |  |                |  |                    |  |               |  |                   |  |                  |  |                     |  |                   
|Comprehensive
      Income                                      |  |           |  |                |  |                    |  | 783,002       |  |                   |  |                  |  |                     |  | 783,002           
|                                                                |  |           |  |                |  |                    |  |               |  |                   |  |                  |  |                     |  |                   
|Balance at
      December 31, 2007                              |  | 6,293,115 |  | $
      62,931 |  | $
      10,023,410 |  | -             |  | $
      1,246,343 |  | $
      (30,135) |  | $
      38,489      |  | $
      11,341,038
|                                                                |  |           |  |                |  |                    |  |               |  |                   |  |                  |  |                     |  |                   
|See Notes to
      Condensed Consolidated Financial Statements. |  |           |  |                |  |                    |  |               |  |                   |  |                  |  |                    

Page 6

---



|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------

INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

NINE MONTHS ENDED DECEMBER 31, 2007 AND 2006



|(UNAUDITED)
|-----------

|                                                             |  | Nine Months Ended December 31,
|------------------------------------------------------------ |  | ------------------------------
|                                                             |  | 2007                          
|                                                             |  |                               
|Cash flows from operating activities:                        |  |                               
|                                                            
|Net income (loss)                                            |  | $ 777,837                     
|Adjustments to reconcile net income (loss) to net cash       |  |                               
|Provided by (used in) operating activities:                  |  |                               
|Depreciation and amortization                                |  | 284,775                       
|Amortization U.S. Treasury Bills                             |  | (8,013)                       
|Change in deferred taxes                                     |  | 61,500                        
|Share-Based Compensation                                     |  | 250,126                       
|Market adjustment Cash surrender value life insurance policy |  | (24,143)                      
|Stock-option compensation                                    |  | -                             
|Change in marketable securities                              |  | (36,612)                      
|Gain on investments                                          |  | (4,395)                       
|                                                            
|Change in operating assets and liabilities:                  |  |                               
|                                                            
|Accounts receivable                                          |  | (104,296)                     
|Prepaid expenses and other assets                            |  | (20,972)                      
|Prepaid income taxes                                         |  | (731,828)                     
|Loans receivable from registered representatives             |  | (157,960)                     
|Accounts payable                                             |  | 298,319                       
|Accrued expenses                                             |  | (1,134,965)                   
|Commissions payable                                          |  | (373,965)                     
|Unearned revenues                                            |  | 1,535,345                     
|                                                             |  |                               
|Net cash provided by operating activities                    |  | 610,753                       
|                                                            
|Cash flows from investing activities:                        |  |                               
|                                                            
|Purchases of property and equipment                          |  | (232,501)                     
|(Payments) Cash Surrender Value life insurance policy        |  | (54,443)                      
|Purchases of Certificates of deposit                         |  | (250,000)                     
|Investments in U.S.Treasury Notes, Bills                     |  | 750,000                       
|Changes in Note Receivable                                   |  | (141)                         
|                                                             |  |                               
|Net cash provided by (used in) investing activities          |  | 212,915                       

Page 7

---



|Investors Capital Holdings, Ltd. report on form
  10-Q
|------------------------------------------------------



|Quarter
      Ended 12/31/07
|----------------------------

INVESTORS CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS

NINE MONTHS ENDED DECEMBER 31, 2007 AND 2006 (CONTINUED)



|(UNAUDITED)
|-----------

|                                                                |  | Nine Months
      Ended December 31,
|--------------------------------------------------------------- |  | ------------------------------------
|                                                                |  | 2007                                
|                                                                |  |                                     
|Cash flows
      from financing activities:                     |  |                                     
|Payment of
      Note Payable                                   |  | $
      (838,358)                   
|Payment of
      dividends                                      |  | -                                   
|Exercise of
      stock options                                 |  | 52,372                              
|                                                                |  |                                     
|Net cash used
      in financing activities                     |  | (785,986)                           
|Net Increase
      (decrease) in cash and cash equivalents      |  | 37,682                              
|Cash and cash
      equivalents, at the beginning of the period |  | 5,498,259                           
|                                                                |  |                                     
|Cash and cash
      equivalents, at the end of the period       |  | $
      5,535,941                   
|                                                                |  |                                     
|                                                               
|Supplemental
      disclosures of cash flow information:        |  |                                     
|Interest
      paid                                             |  | $
      38,147                      
|Income taxes
      paid                                         |  | $
      1,310,247                   



| | See Notes to Condensed Consolidated Financial
  Statements.
| | -----------------------------------------------------------

Page 8

---



|Investors Capital Holdings, Ltd. report on form
  10-Q
|------------------------------------------------------



|Quarter
      Ended 12/31/07
|----------------------------

INVESTORS
CAPITAL HOLDINGS, LTD. AND SUBSIDIARIES CONDENSED NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS



|FOR THE
      QUARTER ENDED DECEMBER 31, 2007
|---------------------------------------------



|(UNAUDITED)
|-----------

NOTE 1. ORGANIZATION, BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING
POLICIES

ORGANIZATION:

Incorporated in July
1995, Investors Capital Holdings, Ltd. ("ICH") is a financial services holding
company that operates in two segments of the financial services industry through
its subsidiaries, Investors Capital Corporation (ICC) (a broker-dealer that,
doing business as Investors Capital Advisors, ICA, also is a registered
investment advisor), Eastern Point Advisors, Inc. (EPA), ICC Insurance Agency,
Inc. and Investors Capital Holdings Securities Corporation (ICH Securities).
These two segments comprise (1) broker-dealer services in support of brokerage
in securities, including provision of market information, internet on-line
brokerage, portfolio tracking and records management, and (2) investment
advisory services including asset management. These products and services are
offered throughout the United States primarily through our network of
independent registered representatives. ICH Securities was formed in March 2005
to hold cash, cash equivalents, interest income and dividend income for
ICH.

BASIS OF PRESENTATION:

The accompanying
unaudited condensed consolidated financial statements of Investors Capital
Holdings, Ltd. and its subsidiaries (the Company) have been prepared in
accordance with accounting principles generally accepted in the United States of
America (GAAP) for interim financial information and with the instructions to
Form 10-Q. In the opinion of management, these financial statements contain all
of the adjustments necessary for a fair presentation of the results of these
interim periods. Certain footnote disclosures normally included in financial
statements prepared in accordance with GAAP have been condensed or omitted,
although the Company believes the disclosures in these financial statements are
adequate to make the information presented not misleading. Operating results for
the three and nine month periods ended December 31, 2007 are not necessarily
indicative of the results that may be expected for the year ending March 31,
2008. The balance sheet at March 31, 2007 has been derived from the audited
financial statements at that date, but does not include all of the information
and footnotes required by GAAP for complete financial statements. These
unaudited condensed consolidated financial statements should be read in
conjunction with the Company's annual audited financial statements included in
the Company's report on Form 10-K for the fiscal year ended March 31, 2007 filed
with the Securities and Exchange Commission (the SEC).

USE OF ESTIMATES AND ASSUMPTIONS:

The preparation of
financial statements in conformity with GAAP requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities as of the date of the financial statements and the reported amounts
of revenues and expenses during the reporting period. Actual results could
differ from those estimates.

RECLASSIFICATIONS:

Certain amounts in
the prior periods have been reclassified to remain consistent with the current
fiscal year financial statement presentation.

SIGNIFICANT ACCOUNTING POLICIES:

Revenue Recognition

Company revenue
recognition policies are summarized below. These policies are maintained in
compliance with SEC Staff Accounting Bulletin ("SAB") 104 "Revenue Recognition
in Financial Statements".

Mutual
Funds/Variable Annuities.Revenue from the sale of mutual funds and variable annuities is
recognized as of the date the check and application is accepted by the
investment company.

Page 9

---



|Investors Capital Holdings, Ltd. report on form
  10-Q
|------------------------------------------------------



|Quarter
      Ended 12/31/07
|----------------------------

***Brokerage.***The Company earns
commissions through stock purchase and sale transactions, mutual fund
purchases,government and corporate bonds
transactions, fee-based managed accounts and ticket charges. In addition, the
Company earns revenue in the form of 12b-1 fees and interest on account
balances. The earnings process is substantially complete at trade date in
accordance with the rules of the Financial Industry Regulatory Authority,
FINRA and the SEC.

The Company also
receives credit for clearing charge adjustments that are netted against any
clearing charges the Company may incur for the period. These adjustments are
recognized as income in the period received unless otherwise noted by the
clearing firm.

Unrealized gains and
losses are recorded at the time that the Company reconciles its brokerage
positions with the market value. The unrealized gains or losses are adjusted to
market until the position is settled or the trade is cancelled.

Advisory
Fees.Our managed accounts advisory fees are based on the amount of assets
managed per agreement negotiated between our independent representatives and
their clients. These revenues are recognized and billed based on the fair market
value of assets managed throughout the quarter. Any portion remaining
uncollected due to account adjustments after account rebalancing is charged
against earnings at the end of the subsequent quarter.

Administration Fees.Administration fees
for services rendered to the Companys representatives respecting annual FINRA
license renewals and E&O insurance are recognized as revenue upon
registration of the representative with FINRA and listing of the registered
representative with the E&O insurance carrier. The funds received from the
registered representative are initially recorded as unearned revenue. The
amounts, if any, collected in excess of the E & O insurance premium and/or
fees due FINRA are recognized as revenue. Fees collected to maintain books and
records are deferred and recognized ratably throughout the year.

Marketing
Revenue.Revenue from
marketing associated with product sales is recognized quarterly based on
production levels. Marketing event revenues are recognized at the commencement
of the event offset by its costs.

Accounts Receivable  Allowance for Doubtful Accounts

The Companys policy for determining whether a receivable is considered
uncollectible is as follows:

Loans to
representatives. Management
performs periodic credit evaluations and provides an allowance based on our
assessment of specifically identified unsecured receivables and other factors,
including the representative's payment history. Once it is determined that it is
both probable that a loan has been impaired and the amount of loss can
reasonably be estimated, the portion of the loan balance estimated to be
uncollectible is so classified and written off. There were no loans written off
to commission expense for the three and nine months ended December 31, 2007 and
2006. See Note 6. Loans to Representatives.

Advisory
fees from mutual funds.Effective October
18, 2005, the Company no longer provides advisory services to mutual funds.
Prior thereto, as disclosed in the respective mutual funds' prospectuses, the
Company attempted to recoup waived advisory service fees within a three-year
period. If management believed that the likelihood of collecting such a
receivable within the three-year period was doubtful, the Company provided for
an allowance. Determinations whether to write off such fees were made annually.
By agreement, the Company is entitled to payment of all uncollected waived
advisory fees by the successor fund adviser.

Trade
receivables.As
prescribed by the SEC, trade receivables usually settle within three days. If a
trade error results, the Company pursues remedies to collect on the trade error.
The Company does not record a receivable resulting from a trade error that is in
litigation or whose outcome is otherwise not reasonably determinable. In such a
case, the Company applies any proceeds from settlements or insurance against any
trade losses incurred.

Income Taxes

The Company provides
for income taxes at the end of each interim period based on the estimated
effective tax rate for the full fiscal year. Cumulative adjustments to the tax
provision are recorded in the interim period in which a change in the estimated
annual effective rate is determined.

The Company adopted
FIN 48 during the fiscal quarter ended June 30, 2006. After analysis conducted
by management and consultants as to the financial impact FIN 48 will have on the
Companys financials, the Company has concluded that FIN 48 will not have a
material impact on its financials.

RECENTLY ISSUED ACCOUNTING STANDARDS:

Page 10

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|Investors Capital Holdings, Ltd. report on form
  10-Q
|------------------------------------------------------



|Quarter
      Ended 12/31/07
|----------------------------

In September 2006,
the FASB issued Statement of Financial Accounting Standards,SFAS No. 157, "Fair
Value Measurements." This new standard provides guidance for using fair value to
measure assets and liabilities. The FASB believes SFAS No. 157 also responds to
investors' requests for expanded information about the extent to which companies
measure assets and liabilities at fair value, the information used to measure
fair value, and the effect of fair value measurements on earnings. SFAS No. 157
applies whenever other standards require or permit assets or liabilities to be
measured at fair value but does not expand the use of fair value in any new
circumstances. SFAS No. 157 becomes effective for the Company as of April 1,
2008. The Company is continuing to evaluate the provisions of this standard and
is not certain of the potential impact at this time.

In February 2007,
the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and
Financial Liabilities ("SFAS 159"), which provides companies with an option to
report selected financial assets and liabilities at fair value. The objective of
SFAS 159 is to reduce both complexity in accounting for financial instruments
and the volatility in earnings caused by measuring related assets and
liabilities differently. SFAS 159 establishes presentation and disclosure
requirements designed to facilitate comparisons between companies that choose
different measurement attributes for similar types of assets and liabilities and
to more easily understand the effect of the companys choice to use fair value
on its earnings. SFAS 159 also requires entities to display the fair value of
the selected assets and liabilities on the face of the balance sheet. SFAS 159
does not eliminate disclosure requirements of other accounting standards,
including fair value measurement disclosures in SFAS 157. This Statement is
effective as of the beginning of an entitys first fiscal year beginning after
November 15, 2007. Early adoption is permitted as of the beginning of the
previous fiscal year provided that the entity makes that choice in the first 120
days of that fiscal year and also elects to apply the provisions of Statement
157. Adoption of SFAS 159 is not expected to have a material impact on the
Companys results of operations or financial position.

NOTE 2. SEGMENT INFORMATION

The Company makes
disclosures about products and services, geographic areas, and major customers
in accordance with SFAS No. 131, "Disclosures about Segments of an Enterprise
and Related Information." The Company evaluates performance based on profit and
loss from operations after income taxes.

The Company accounts
for inter-segment services and transfers as if the services or transfers were to
third parties, that is, at current market prices. The Company's reportable
segments are strategic business units that offer different services. They are
managed separately because each business requires distinct marketing strategies
and varied technological and operational support.

The Company's
reportable segments include broker/dealer and related services offered through
ICC and asset management (investment advisory) services offered through ICA and
EPA. ICC earns commissions as a broker for its customers in the purchase and
sale of securities on major exchanges and other public markets. Asset management
services generate recurring annual revenue from fees received on the management
of customer accounts.

EPA provided asset
management and portfolio design services to two mutual funds until October 18,
2005, and provided money management services to a variety of investors through
March 2006. ICAs primary mission is to offer clients investment advisory and
asset management procedures grounded on sound investment principles of asset
allocation, performance monitoring and portfolio rebalancing. To improve
efficiency, EPA transitioned the bulk of its advisory services business to ICA
over the 2 1⁄2 year period ended March 31, 2006. Subsequently, EPA operations have
been limited to providing access for third-party advisory services.

Under the guidelines
of FAS 131 Disclosures about Segments of an Enterprise and Related
Information, commencing with the quarter ended December 31, 2005, management
reports its segments on a management approach whereby our business is presented
in segments reflecting the way we make operating decisions and assess
performance. Accordingly, ICA is now reported as part of the asset management
services segment. Segments are currently reported based upon the services
provided, whereas they were previously segmented according to legal
entity.

In presenting
segment data, all corporate overhead items are allocated to the segments, and
inter-segment revenue, expense, receivables and payables are eliminated.
Currently it is impractical to report segment information using geographical
concentration.

Assets are allocated
among ICH and its subsidiaries based upon legal ownership and the services
provided. Total period-end assets are presented in this Note 2 on a stand-alone
basis, i.e., without inter-company eliminations. Corporate items and
eliminations are presented in the following table for the purpose of reconciling
the stand-alone asset amounts to total consolidated assets.

Page 11

---



|Investors Capital Holdings, Ltd. report on form
  10-Q
|------------------------------------------------------



|Quarter
      Ended 12/31/07
|----------------------------

|                                             |  | December
      31, 
|-------------------------------------------- |  | -------------------
|                                             |  | 2007               
|                                             |  |                    
|Inter-company
      eliminations             |  | $
      (1,085,829)
|Deferred
      income taxes                  |  | (512,314)          
|Income
      Taxes                           |  | (4,468)            
|                                             |  |                    
|                                            
|Total
      Corporate items and eliminations |  | $
      (1,602,611)
|                                             |  |                    

Page 12

---



|Investors Capital Holdings, Ltd. report on form
  10-Q
|------------------------------------------------------



|Quarter
      Ended 12/31/07
|----------------------------

|Segment
      reporting is as follows:                         |  |                            |  |              |  |        
|-------------------------------------------------------------- |  | -------------------------- |  | ------------ |  | -------
|                                                              
|                                                               |  | Quarter Ended December 31, |  |             
|                                                               |  | 2007                       |  | 2006         |  |        
|                                                               |  |                            |  |              |  |        
|Non-interest revenues:                                         |  |                            |  |              |  |        
|ICC brokerage
      services                                   |  | $ 20,216,946               |  | $ 18,753,502 |  |        
|EPA, ICA asset
      management services                       |  | 2,823,749                  |  | 1,948,396    |  |        
|                                                               |  |                            |  |              |  |        
|                                                              
|Total                                                          |  | $ 23,040,695               |  | $ 20,701,898 |  |        
|                                                               |  |                            |  |              |  |        
|                                                              
|Revenues
      from transaction with other operating segments: |  |                            |  |              |  |        
|ICC brokerage
      services                                   |  | $ 712,541                  |  | $ 415,703    |  |        
|EPA, ICA asset
      management services                       |  |                            |  | 99,514       |  | 43,189 
|                                                               |  |                            |  |              |  |        
|                                                              
|Total                                                          |  | $ 812,055                  |  | $ 458,892    |  |        
|                                                               |  |                            |  |              |  |        
|                                                              
|Interest
      and dividend income,net:                        |  |                            |  |              |  |        
|ICC brokerage
      services                                   |  | $ 195,316                  |  | $ 157,828    |  |        
|EPA, ICA asset
      management services                       |  |                            |  | 14,445       |  | 13,354 
|ICH                                                            |  |                            |  | 2,639        |  | 3,139  
|ICH
      Securities                                           |  |                            |  | 17,861       |  | 37,407 
|                                                               |  |                            |  |              |  |        
|                                                              
|Total                                                          |  | $ 230,261                  |  | $ 211,728    |  |        
|                                                               |  |                            |  |              |  |        
|                                                              
|Depreciation and amortization expenses:                        |  |                            |  |              |  |        
|ICC brokerage
      services                                   |  | $ 96,917                   |  | $ 70,717     |  |        
|EPA, ICA asset
      management services                       |  |                            |  | 691          |  | 691    
|                                                               |  |                            |  |              |  |        
|                                                              
|Total                                                          |  | $ 97,608                   |  | $ 71,408     |  |        
|                                                               |  |                            |  |              |  |        
|                                                              
|                                                              
|Income
      tax provision (benefit):                          |  |                            |  |              |  |        
|ICC brokerage
      services                                   |  | $ (151,924)                |  | $ (222,892)  |  |        
|EPA, ICA asset
      management services                       |  | 203,509                    |  | 111,741      |  |        
|ICH                                                            |  |                            |  | 32,000       |  | 4,395  
|                                                               |  |                            |  |              |  |        
|                                                              
|Total                                                          |  | $ 83,585                   |  | $ (106,756)  |  |        
|                                                               |  |                            |  |              |  |        
|                                                              
|Income
      (loss) :                                          |  |                            |  |              |  |        
|ICC brokerage
      services                                   |  | $ (234,615)                |  | $ (599,586)  |  |        
|EPA, ICA asset
      management services                       |  | 247,371                    |  | 245,313      |  |        
|ICH                                                            |  |                            |  | 21,624       |  | (4,063)
|ICH
      Securities                                           |  |                            |  | 17,841       |  | 37,407 
|                                                               |  |                            |  |              |  |        
|                                                              
|Total                                                          |  | $ 52,221                   |  | $ (320,929)  |  |        
|                                                               |  |                            |  |              |  |        
|                                                              
|Period
      end total assets:                                 |  |                            |  |              |  |        
|ICC brokerage
      services                                   |  | $ 13,097,847               |  | $ 12,738,283 |  |        
|EPA, ICA asset
      management services                       |  | 1,435,353                  |  | 1,382,027    |  |        
|ICH                                                            |  | 3,101,337                  |  | 2,062,933    |  |        
|ICH
      Securities                                           |  | 1,433,823                  |  | 1,932,034    |  |        
|Corporate
      items and eliminations                         |  | (1,602,611)                |  | (1,491,700)  |  |        
|                                                               |  |                            |  |              |  |        
|                                                              
|Total                                                          |  | $ 17,465,749               |  | $ 16,623,577 |  |        
|                                                               |  |                            |  |              |  |        

Page 13

---



|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------

|                                                         |  | Nine Months Ended December 31, |  |              
|-------------------------------------------------------- |  | ------------------------------ |  | -------------
|                                                         |  | 2007                           |  | 2006         
|                                                         |  |                                |  |              
|Non-interest revenues:                                   |  |                                |  |              
|ICC brokerage services                                   |  | $ 60,753,336                   |  | $ 52,191,975 
|EPA, ICA asset management services                       |  | 7,674,894                      |  | 5,004,175    
|                                                         |  |                                |  |              
|Total                                                    |  | $ 68,428,230                   |  | $ 57,196,150 
|                                                         |  |                                |  |              
|                                                        
|Revenues from transaction with other operating segments: |  |                                |  |              
|ICC brokerage services                                   |  | $ 1,420,433                    |  | $ 1,968,267  
|EPA, ICA asset management services                       |  | 184,302                        |  | 181,123      
|                                                         |  |                                |  |              
|                                                        
|Total                                                    |  | $ 1,604,735                    |  | $ 2,149,390  
|                                                         |  |                                |  |              
|                                                        
|Interest and dividend income,net:                        |  |                                |  |              
|ICC brokerage services                                   |  | $ 567,920                      |  | $ 429,813    
|EPA, ICA asset management services                       |  | 43,131                         |  | 45,878       
|ICH                                                      |  | 4,480                          |  | 3,594        
|ICH Securities                                           |  | 61,194                         |  | 96,281       
|                                                         |  |                                |  |              
|                                                        
|Total                                                    |  | $ 676,725                      |  | $ 575,566    
|                                                         |  |                                |  |              
|                                                        
|Depreciation and amortization expenses:                  |  |                                |  |              
|ICC brokerage services                                   |  | $ 282,703                      |  | $ 204,386    
|EPA, ICA asset management services                       |  | 2,072                          |  | 2,070        
|                                                         |  |                                |  |              
|                                                        
|Total                                                    |  | $ 284,775                      |  | $ 206,456    
|                                                         |  |                                |  |              
|                                                        
|Income tax provision (benefit):                          |  |                                |  |              
|ICC brokerage services                                   |  | $ 71,981                       |  | $ (899,674)  
|EPA, ICA asset management services                       |  | 541,906                        |  | 407,735      
|ICH                                                      |  | 26,032                         |  | 23,712       
|                                                         |  |                                |  |              
|                                                        
|Total                                                    |  | $ 639,919                      |  | $ (468,227)  
|                                                         |  |                                |  |              
|                                                        
|Income (loss) :                                          |  |                                |  |              
|ICC brokerage services                                   |  | $ 69,260                       |  | $ (1,697,741)
|EPA, ICA asset management services                       |  | 677,475                        |  | 555,152      
|ICH                                                      |  | (30,072)                       |  | (42,058)     
|ICH Securities                                           |  | 61,174                         |  | 96,261       
|                                                         |  |                                |  |              
|                                                        
|Total                                                    |  | $ 777,837                      |  | $ (1,088,386)
|                                                         |  |                                |  |              
|                                                        
|Period end total assets:                                 |  |                                |  |              
|ICC brokerage services                                   |  | $ 13,097,847                   |  | $ 12,738,283 
|EPA, ICA asset management services                       |  | 1,435,353                      |  | 1,382,027    
|ICH                                                      |  | 3,101,337                      |  | 2,062,933    
|ICH Securities                                           |  | 1,433,823                      |  | 1,932,034    
|Corporate items and eliminations                         |  | (1,602,611)                    |  | (1,491,700)  
|                                                         |  |                                |  |              
|                                                        
|Total                                                    |  | $ 17,465,749                   |  | $ 16,623,577 
|                                                         |  |                                |  |              

NOTE 3. LITIGATION

The Company typically is involved with various judicial, regulatory and arbitration proceedings concerning matters arising in connection with the conduct of its business.

Massachusetts Proceedings

By administrative complaint dated November 16, 2005, the Securities Division of the Secretary of the Commonwealth of Massachusetts brought an adjudicatory proceeding against the Company alleging violation of supervisory obligations under state securities laws in connection with certain past sales of equity-indexed annuities by a few independent representatives. In settling these proceedings on December 19, 2006, the Company agreed, among other things:

- to pay a $0.5 million administrative fine,
- to offer to reimburse losses and costs incurred by Massachusetts persons aged 75 or older in connection with the surrender, no later than December 31, 2007, of any equity-indexed annuities purchased through ICC or its representatives during 2004 or 2005, and to offer an additional payment to ensure that no amount invested in a surrendered EIA yielded less than 3%; and
- to pay an additional administrative fine equal to the extent, if any, that ICCs surrender-related payments total less than $0.5 million.

Page 14

---



|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------

Settlement to claimants totaled $310,059, and accordingly, the Company will pay the remainder $189,941 to the Securities Division during the fourth quarter of this fiscal year.

Other Proceedings

At December 31, 2007, the Company was a co-defendant in various legal proceedings other than the Massachusetts Proceedings. Management believes, based on currently available information, that the results of such proceedings, in the aggregate, will not have a material adverse effect on the firm's financial condition. The Company has Errors and Omissions ("E&O") insurance to protect itself from potential damages and/or legal costs associated with the majority of aforementioned lawsuits and, as a result, in the majority of cases the Companys exposure is limited to between $75,000 and $100,000 per case, subject to policy limitations and exclusions.

Legal Expense Accruals

In accordance with Financial Accounting Standards Board ("FASB") Statement No. 5, "Accounting for Contingencies", the Company had accrued legal fees and estimated settlement costs of approximately $0.55 million and $1.10 million as of December 31, 2007 and March 31, 2007, respectively, relating to the Company's defense and/or settlement of various lawsuits. At December 31, 2007, $0.19 million of the accrual was related to the settlement of the Massachusetts Proceedings versus $0.48 million at March 31, 2007.

NOTE 4. STOCK BASED COMPENSATION

On April 1, 2006, the Company adopted SFAS No. 123(R),Share-Based Payment, which requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on their fair value over the requisite service period. The adoption of this statement did not have a material impact on the Companys consolidated financial statements for prior periods because the Company adopted the fair value recognition provisions of SFAS No. 123 effective September 28, 2002 using the modified prospective application transition method within the provisions of SFAS No. 148, Accounting for Stock-Based Compensation - Transition and Disclosure.

Stock Options

Prior to the adoption of SFAS 123(R), the Company had granted options and had reported as a footnote disclosure thepro formaeffect if we had reported an expense under the guidelines of SFAS No. 123. There was no stock option expense for the quarters ended December 31, 2007 and 2006. The pro forma expense calculated using the Black-Scholes option pricing model did not exceed the cumulative expense previously disclosed in the Companys report on Form 10-K for the fiscal year ended March 31, 2005.

The following is a summary of the status of the Company's employee and director fixed stock options as of December 31, 2007 and 2006:

|                                   |  | 2007      |  | 2006            
|---------------------------------- |  | --------- |  | ----------------
|                                   |  |           |  |                 
|                                   |  |           |  | Weighted-Average
|                                   |  | Shares    |  | Exercise Price  
|                                   |  |           |  |                 
|                                  
|Outstanding at beginning of year   |  | $ 153,332 |  | $1.02           
|                                  
|Granted                            |  | -         |  |                 
|Forfeited                          |  | -         |  |                 
|Exercised                          |  | -         |  |                 
|Reclassified(non-employee)         |  | -         |  |                 
|                                   |  |           |  |                 
|                                  
|Outstanding at quarter end         |  | 153,332   |  | $1.02           
|                                  
|Options exercisable at quarter-end |  | $ 153,332 |  | $1.02           
|                                  
|Weighted-average fair value of     |  |           |  |                 
|options granted during the year    |  | $ -       |  |                 

Page 15

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|Investors Capital Holdings, Ltd. report on form
  10-Q
|------------------------------------------------------



|Quarter
      Ended 12/31/07
|----------------------------

The following assumptions were applied to employee options for the
quarters ended December 31, 2007 and 2006.

|                              | 2007  |  | 2006 
|----------------------------- | ----- |  | -----
|                              |       |  |      
|                             
|Dividend                      | 0.00% |  | 0.19%
|Volatility                    | 34%   |  | 47%  
|Risk-free
      interest rate | 0.00% |  | 4.85%
|Expected Life
      in years  | 0     |  | 1.00 

The following table summarizes information about employee and directors'
fixed stock options outstanding as of December 31, 2007:

|Options
      Outstanding |  | Options
      Exercisable
|------------------------- |  | -------------------------
|                          |  |                          
|                          |  |                          
|Range
      Of            |  | Number                   
|Exercise
      Prices     |  | Outstanding              
|                          |  |                          
|                         
|$1.00                     |  | 150,000                  
|$1.91                     |  | 3,332                    
|                          |  |                          
|                          |  | 153,332                  

Restricted Stock

Under the 2005
Equity Incentive Plan (the Plan) the Company is authorized to grant shares of
ICH common stock to employees, directors, officers, representatives and other
key individuals. Grants under the Plan may be made in connection with initial
employment or under various retention plans and, to date, have subjected
unvested options and shares to forfeiture in the event of termination other than
for death, disability or retirement. The compensation cost associated with these
stock grants is recognized over the vesting period of the shares and is
calculated as the market value of the shares on the date of grant. The following
activity occurred during the three and nine months period ended December 31,
2007:

|                        |  | THREE
      MONTHS ENDED DECEMBER 31, 2007 |  |                               
|----------------------- |  | ------------------------------------------ |  | ------------------------------
|                        |  | Shares                                     |  | Weighted Ave
      Stock Price
|                        |  |                                            |  |                               
|Non-vested
      at     |  |                                            |  |                               
|October 1,
      2007   |  |                                            |  | 194,988                       
|                        |  |                                            |  |                               
|Granted                 |  |                                            |  | 3,250                         
|Vested                  |  |                                            |  | (19,058)                      
|Canceled                |  |                                            |  | (4,396)                       
|Non-vested
      at     |  |                                            |  | 174,784                       
|December 31,
      2007 |  |                                            |  |                               
|                        |  |                                            |  |                               



|NINE
      MONTHS ENDED DECEMBER 31, 2007
|-----------------------------------------
|                                         
|                                         
|Non-vested
      at                      
|April 1,
      2007                      
|                                         
|Granted                                  
|Vested                                   
|Canceled                                 
|Non-vested
      at                      
|December 31,
      2007                  
|                                         

Page 16

---



|Investors Capital Holdings, Ltd. report on form
  10-Q
|------------------------------------------------------



|Quarter
      Ended 12/31/07
|----------------------------

The Companys net
income for the three months ended December 31, 2007 includes $41,209 of
compensation costs related to the Companys grants of restricted stock to
employees, and $38,853 for grants to independent representatives, under the
Plan.

The Companys net
loss for the three months ended December 31, 2006 includes $30,797 of
compensation costs related to the Companys grants of restricted stock to
employees, and $14,139 for grants to independent representatives, under the
Plan.

For the nine months
ended December 31, 2007 the compensation costs related to this plan includes
$150,702 to employees and $99,424 for grants to independent representatives,
under the Plan.

For the nine months
ended December 31, 2006 the compensation costs related to this plan includes
$618,790 to employees and $88,290 for grants to directors, consultants and
independent representatives.

As of December 31,
2007, there was $716,614 of total unrecognized compensation cost related to
grants under the Plan. These costs are expected to be recognized over a weighted
average period of approximately 2.85 years. The total fair value of shares
vested under this plan during the three months and nine months ended December
31, 2007 was, respectively, was $81,949 and $254,465.

As of December 31,
2006, there was $777,369 of total unrecognized compensation cost related to
grants under the Companys Equity Incentive Plan. These costs were expected to
be recognized over a weighted average period of approximately 4.01 years. The
total fair value of shares vested under this plan during the three months and
nine months ended December 31, 2006 was $45,961 and $708,482.

NOTE 5 - NOTE RECEIVABLE

On October 24, 2005,
the Company entered into a definitive agreement (the Transition Agreement)
with Dividend Growth Advisors, LLC (DGA). Pursuant to the Transition
Agreement, the Company agreed to terminate its Investment Advisory Agreement
with Eastern Point Advisors Funds Trust (the Trust) effective October 18, 2005
to permit the appointment by the Trust of DGA to supersede the Company as the
Trusts investment adviser. The Company had served since 1999 as Investment
Adviser for the Funds, which are sponsored by the Trust, and DGA had provided
investment advisory services to the Trust since 2004 pursuant to a subcontract
with the Company. DGA entered into a new advisory agreement directly with the
Trust.

Under the terms of
the Transition Agreement and an associated promissory note, the receivable owed
by the Funds to the Company was assigned to DGA, and DGA agreed to pay the
Company an amount equal to the total of all fees that the Company had waived or
remitted to a fund in the Trust through October 18, 2005. In addition, DGA has
agreed to pay the Company 10 basis points on the assets raised by the Companys
broker dealer ICC at the effective time of transition, October 18, 2005 subject
to mark to market adjustments. These fees are to be paid to the Company on a
quarterly basis. Although these payments are part of the agreement between DGA
and the Trust, they are not part of the terms of the note and are deemed totally
separate.

The note provides
for a principle amount of $747,617, quarterly payments of interest accruing
thereon at a 5.5% annual rate, and a full payment on or before October 31, 2010.
Prepayments are permitted without penalty.

NOTE 6  LOANS TO REGISTERED REPRESENTATIVES

ICC has granted
loans to certain registered representatives with the stipulation that the loans
will be forgiven if the representatives remain licensed with the Company for an
agreed upon period of time, generally one to five years, and/or meet specified
performance goals. Upon forgiveness, the loans are charged to commission expense
for financial reporting purposes. There were no loans charged to commission
expense for the quarters ended December 31, 2007 and 2006.

Other loans to
registered representatives are not subject to a forgiveness contingency. These
loans, as well as loans that have not met the forgiveness contingency, are
repaid to the Company by deducting a portion of the representatives commission
payouts throughout the commission cycle until the loans are paid off.

Interest charged on these loans to representatives range from 3% to 8.25%
per annum.

Page 17

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|Investors Capital Holdings, Ltd. report on form
  10-Q
|------------------------------------------------------



|Quarter
      Ended 12/31/07
|----------------------------

|                        |  | December
      31, |  | March
      31,
|----------------------- |  | ------------------ |  | ---------------
|                        |  | 2007               |  | 2007           
|                        |  |                    |  |                
|Forgiveable
      Loans |  | $
      483,288    |  | $
      331,023
|Other
      Loans       |  | 336,469            |  | 330,774        
|                        |  |                    |  |                
|Total
      Loans       |  | $
      819,757    |  | $
      661,797
|                        |  |                    |  |                

NOTE 7 - INVESTMENTS

Securities that are
not readily marketable include investment securities (a) for which there is no
market on a securities exchange or no independent publicly quoted market, (b)
that cannot be publicly offered or sold unless registration has been effected
under the Securities Act of 1933, or (c) that cannot be offered or sold because
of other arrangements, restrictions, or conditions applicable to the securities
or to the Company. The Company has not exercised significant influence over
these equity investments; accordingly, these investments were recorded as of
December 31, 2007 and March 31, 2007 at the Companys cost of $190,000 pursuant
to Accounting Principles Board No. 18 "The Equity Method of Accounting for
Investments in Common Stock" (APB 18).

As of December 31,
2007, the Company had investments in U.S. Treasury Notes being held to maturity
in accordance with SFAS No. 115, Accounting for Certain Investments in Debt and
Equity Securities. These investments are presented at an amortized value as
follows:

|                    |  |                      |  | DECEMBER
      31, 2007                                   |  |                   |  |                      |  |                     
|------------------- |  | -------------------- |  | --------------------------------------------------------- |  | ----------------- |  | -------------------- |  | --------------------
|Purchase
      Date |  | Purchase
      Price |  | Interest Rate
      /Maturity Date /Coupon Date           |  | Face
      Value  |  | Amortized
      Cost |  | Interest
      Date 
|                    |  |                      |  |                                                           |  |                   |  |                      |  |                     
|                   
|7/12/2006           |  | 248,525              |  | US TREAS NOTES
      4.875% 04/30/08 B/E DTD 04/30/06 N/C |  | 250,000           |  | 249,751              |  | Apr 30, Oct
      31
|7/12/2006           |  | 249,727              |  | US TREAS NOTES
      5.125% 06/30/08 B/E DTD 06/30/06 N/C |  | 250,000           |  | 250,015              |  | Jun 30, Dec
      30
|9/28/2006           |  | 250,732              |  | US TREAS NOTES
      4.875% 08/31/08 B/E DTD 08/31/06 N/C |  | 250,000           |  | 250,267              |  | Feb 28, Aug
      28
|11/3/2006           |  | 242,461              |  | US TREAS NOTES
      3.125% 10/15/08 B/E DTD 10/15/03 N/C |  | 250,000           |  | 246,823              |  | Apr 15, Oct
      15
|                    |  |                      |  |                                                           |  |                   |  |                      |  |                     
|                    |  | $
      991,445      |  | Balance at
      December 31, 2007                        |  | $
      1,000,000 |  | $
      996,856      |  |                     
|                    |  |                      |  |                                                           |  |                   |  |                      |  |                     
|                   
|                   
|                   
|                    |  |                      |  | MARCH 31,
      2007                                      |  |                   |  |                      |  |                     
|Purchase
      Date |  | Purchase
      Price |  | Interest Rate
      /Maturity Date /Coupon Date           |  | Face
      Value  |  | Amortized
      Cost |  | Interest
      Date 
|                    |  |                      |  |                                                           |  |                   |  |                      |  |                     
|7/12/2006           |  | $
      242,745      |  | US TREAS NOTES
      3.000% 11/15/07 B/E DTD 11/15/02 N/C |  | $
      250,000   |  | $
      246,594      |  | May 15, Nov
      15
|7/12/2006           |  | 246,650              |  | US TREAS NOTES
      3.625% 04/30/07 B/E DTD 04/30/05 N/C |  | 250,000           |  | 249,695              |  | Apr 30, Oct
      31
|7/12/2006           |  | 246,035              |  | US TREAS NOTES
      3.625% 06/30/07 B/E DTD 06/30/05 N/C |  | 250,000           |  | 249,025              |  | Jun 30, Dec
      30
|7/12/2006           |  | 248,525              |  | US TREAS NOTES
      4.875% 04/30/08 B/E DTD 04/30/06 N/C |  | 250,000           |  | 249,088              |  | Apr 30, Oct
      31
|7/12/2006           |  | 249,727              |  | US TREAS NOTES
      5.125% 06/30/08 B/E DTD 06/30/06 N/C |  | 250,000           |  | 249,865              |  | Jun 30, Dec
      30
|9/28/2006           |  | 250,732              |  | US TREAS NOTES
      4.875% 08/31/08 B/E DTD 08/31/06 N/C |  | 250,000           |  | 250,520              |  | Feb 28, Aug
      28
|11/3/2006           |  | 242,461              |  | US TREAS NOTES
      3.125% 10/15/08 B/E DTD 10/15/03 N/C |  | 250,000           |  | 244,055              |  | Apr 15, Oct
      15
|                    |  |                      |  |                                                           |  |                   |  |                      |  |                     
|                    |  | $
      1,726,875    |  | Balance at
      March 31, 2007                           |  | $
      1,750,000 |  | $
      1,738,842    |  |                     
|                    |  |                      |  |                                                           |  |                   |  |                      |  |                     

On September 08,
2006, The Eastern Point Advisors Capital Appreciation Fund merged with The
Eastern Point Advisors Rising Dividend Fund to become The Rising Dividend Growth
Fund. As of December 31, 2007 the Company held a 0.24% ownership interest in The
Rising Dividend Growth Fund, which had a fair market value of $185,638. At March
31, 2007 this investment had a fair market value of $176,079 which represented a
0.30% ownership interest.

The Company has
invested in a $250,000 face amount Certificate of Deposit with a stated date of
maturity as of December 26, 2008 with a coupon rate of 4.70% . The Company is
holding this investment to maturity. The Company had not invested in this
Certificate of Deposit until after March 31, 2007.

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

Page 18

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|Investors Capital Holdings, Ltd. report on form
  10-Q
|------------------------------------------------------



|Quarter
      Ended 12/31/07
|----------------------------

Management's
discussion and analysis reviews our consolidated financial condition as of
December 31, 2007 and March 31, 2007, the consolidated results of operations for
the 3 and 9 months ended December 31, 2007 and 2006 and, where appropriate,
factors that may affect future financial performance. The discussion should be
read in conjunction with the consolidated financial statements and related
notes, included elsewhere in this Form 10-Q. Unless context requires otherwise,
as used in this Managements Discussion and Analysis (i) the current period
means the 3 or 9 months ended December 31, 2007, (ii) the prior period means
the 3 or 9 months ended December 31, 2006, (iii) an increase and decrease
compares the current period to the prior period, and (iv) all non-comparative
amounts refer to the current period.

FORWARD-LOOKING STATEMENTS

The statements,
analysis, and other information contained herein relating to trends in our
operations and financial results, the markets for our products, the future
development of our business, and the contingencies and uncertainties to which we
may be subject, as well as other statements including words such as
"anticipate," "believe," "plan," "estimate," "expect," "intend," "will,"
"should," "may," and other similar expressions, are "forward-looking statements"
under the Private Securities Litigation Reform Act of 1995. Such statements are
made based upon management's current expectations and beliefs concerning future
events and their effects on the Company and are subject to many risks and
uncertainties. Our actual results may differ materially from the results
anticipated in these forward-looking statements. Readers are directed to
discussions of risks and uncertainties that may be found in this report and
other documents filed by the Company with the United States Securities and
Exchange Commission. We specifically disclaim any obligation to update or revise
any forward-looking information, whether as a result of new information, future
developments or otherwise.

OVERVIEW

We are a financial
services holding company that, through our subsidiaries, provides brokerage,
investment advisory, insurance and related services. We operate in a highly
regulated and competitive industry that is influenced by numerous external
factors such as economic conditions, marketplace liquidity and volatility,
monetary policy, global and national political events, regulatory developments,
competition, and investor preferences. Our revenues and net earnings may be
either enhanced or diminished from period to period by such external factors.

OUR BUSINESS

The Company operates
primarily through its subsidiary, ICC, as a broker/dealer and, doing business as
ICA, as a registered investment advisor, with a national network of independent
financial representatives.

Broker-Dealer Services

The Company provides
broker-dealer services in support of trading and investment by its
representatives customers in corporate equity and debt securities, U.S.
Government securities, municipal securities, mutual funds, variable annuities
and variable life insurance, including provision of market information, internet
brokerage, portfolio tracking facilities and records management.

Investment Advisory Services

The Company provides
investment advisory services, including asset allocation and portfolio
rebalancing, for its representatives customers. In the past, investment
advisory services were performed by both ICC and EPA. To avoid the duplication
of effort involved in supporting two advisory services entities, the Company has
consolidated substantially all of its investment advisor services in ICA. Since
March 31, 2006, EPA operations have been limited to providing third-party
advisory services.

Recruitment and Support of Representatives

A key component of
our business strategy is to recruit well-established, productive representatives
who seek to leverage our increasingly advanced technology. The utilization of
sophisticated technology platforms allows us to more efficiently conduct
business. Additionally, we assist our existing representatives in developing and
expanding their business by providing a variety of support services and a
diversified range of investment products for their clients. The Company focuses
on providing substantial added value to our representatives practices enabling
them to be more productive in both the advisory services and brokerage
sectors.

Support provided to
assist representatives in pursuing consistent and profitable sales growth takes
many forms, including: hi-tech brokerage systems, targeted financial assistance
and a network of communication links with investment product companies. Regional
and national conventions provide forums for interaction to improve product
knowledge, sales and client satisfaction. In addition, a dedicated business
development unit focuses on providing representatives with programs

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|Investors Capital Holdings, Ltd. report on form
  10-Q
|------------------------------------------------------



|Quarter
      Ended 12/31/07
|----------------------------

and tools to grow their businesses both through new client acquisition
and advancement of existing client relationships. These programs enhance our
ability to attract and retain productive representatives.

OUR PROCESS

Check and Application

The majority of
transactions are conducted through a check and application process where a check
and an investment company's product application are delivered to us or through
our field supervisory principal for processing that includes principal review
and submission to the investment company or clearing firm. Investments in
technology have allowed the firm to move from a paper intensive to a virtually
paper free process. This has shortened the transaction cycle, reduced errors and
created greater efficiencies. The firm continues to invest in technologies that
provide more efficient processes resulting in improved productivity.

Online Trading

Registered
representatives can efficiently submit a wide range of security investments
online through the use of remote electronic-entry brokerage platform.

Bond Trading

The Company's
fixed-income brokerage desk uses a network of regional and primary dealers to
execute trades across a broad array of fixed-income asset classes. The desk also
utilizes several dealer-only electronic services that allow the desk to offer
inventory and to execute trades. Our fixed income traders work with our
representatives to develop portfolios for clients. This area has seen growth as
interest rates have risen and more investors have become interested in
retirement income.

Asset Allocation

Asset allocation
services are made available through ICA, the Company's registered investment
advisory service provider. Our services include the design, selection and
rebalancing of investments on behalf of our representatives clients in addition
to providing the tools, services and guidance that enable our representatives to
provide these investment services directly to their clients. These services, for
the most part, are conducted through our online brokerage platform. Other
allocation services are performed directly by the fund company.

OFF-BALANCE SHEET RISK

We execute
securities transactions on behalf of our customers. If either the customer or a
counter-party fails to perform, we, by agreement with our clearing broker, may
be required to discharge the obligations of the non-performing party. In such
circumstances, we may sustain a loss if the market value of the security is
different from the contract value of the transaction. We seek to control
off-balance sheet risk by monitoring the market value of securities held or
given as collateral in compliance with regulatory and internal guidelines.
Pursuant to such guidelines, our clearing firm requires that we reduce positions
when necessary. We also complete credit evaluations where there is thought to be
credit risk.

CRITICAL ACCOUNTING POLICIES

In General

Our consolidated
financial statements are prepared in accordance with accounting principles
generally accepted in the United States of America. The Company believes that of
its significant accounting policies (see Footnote 1 to the Companys condensed
consolidated financials statements contained herein), those dealing with revenue
recognition, allowance for doubtful accounts receivable, and taxes involve a
particularly high degree of judgment and complexity. Our accounting policies
require estimates and assumptions that affect the amounts of assets,
liabilities, revenues and expenses reported in the condensed consolidated
financial statements. Due to their nature, estimates involve judgment based upon
available information. Actual results or amounts can and do differ from
estimates and the differences can have a material effect on the condensed
consolidated financial statements. Therefore, understanding these policies is
important to understanding the reported results of operations and the financial
position of the Company.

Reserves

The Company records
reserves related to legal proceedings in accrued expenses in the condensed
consolidated balance sheet. The determination of these reserve amounts requires
significant judgment on the part of management. Management considers many
factors including, but not limited to: the amount of the claim; the amount of
the loss in the clients account; the basis and validity of the claim; the
possibility of wrongdoing on the part of an employee or representative of theCompany; previous results in similar cases; and legal precedents. Each
legal proceeding is reviewed with counsel in each

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|Investors Capital Holdings, Ltd. report on form
  10-Q
|------------------------------------------------------



|Quarter
      Ended 12/31/07
|----------------------------

accounting period and the reserve is adjusted as deemed appropriate by
management. Any change in the reserve amount is recorded in the consolidated
financial statements and is recognized as a charge/credit to earnings in that
period. The assumptions made by management in determining the estimates of
reserves may be incorrect and the actual costs upon disposition of a legal
proceeding may be greater or less than the reserved amount.

KEY INDICATORS OF FINANCIAL PERFORMANCE FOR MANAGEMENT

Management
periodically reviews and analyzes our financial performance across a number of
measurable factors considered to be particularly useful in understanding and
managing our business. Key metrics in this process include average production
per representative, top line commission and advisory services revenues, gross
margins, operating expenses, legal costs, and earnings per share.

COMPARISON OF
THE FISCAL QUARTERS ENDED DECEMBER 31, 2007 AND 2006

|RESULTS
      OF OPERATIONS                |  |                                  |  |                    |  |                          |  |         |  |               
|------------------------------------------ |  | -------------------------------- |  | ------------------ |  | ------------------------ |  | ------- |  | --------------
|                                          
|                                           |  |                                  |  |                    |  | Percent of
      Revenue |  |        
|                                           |  |                                  |  |                    |  | Quarter Ended            |  | Percent
|                                           |  | Quarter Ended
      December 31, |  | December 31,       |  | Change                  
|                                           |  |                                  |  |                    |  |                         
|                                           |  |                                  |  |                    |  |                          |  |         |  | 2007          
|                                           |  | 2007                             |  | 2006               |  | 2007                     |  | 2006    |  | vs.
      2006
|                                           |  |                                  |  |                    |  |                          |  |         |  |               
|Revenues:                                  |  |                                  |  |                    |  |                          |  |         |  |               
|Commission                                 |  | $
      19,552,008               |  | $
      17,982,588 |  | 84.0%                    |  | 86.1%   |  | 8.7%          
|Advisory
      fees                        |  | 2,752,804                        |  | 1,888,576          |  | 11.8%                    |  | 9.0%    |  | 45.8%         
|Other fee
      income                     |  | 421,439                          |  | 402,410            |  | 1.8%                     |  | 1.9%    |  | 4.7%          
|Marketing
      revenue                    |  | 314,444                          |  | 427,425            |  | 1.4%                     |  | 2.0%    |  | -26.4%        
|Other
      income                         |  | 230,261                          |  | 212,627            |  | 1.0%                     |  | 1.0%    |  | 8.3%          
|                                           |  |                                  |  |                    |  |                          |  |         |  |               
|Total
      Revenue                        |  | 23,270,956                       |  | 20,913,626         |  | 100.0%                   |  | 100.0%  |  | 11.3%         
|                                           |  |                                  |  |                    |  |                          |  |         |  |               
|Commission and
      advisory fee expenses |  | 18,190,813                       |  | 16,498,437         |  | 78.2%                    |  | 78.9%   |  | 10.3%         
|Gross
      Profit                         |  | 5,080,143                        |  | 4,415,189          |  | 21.8%                    |  | 21.1%   |  | 15.1%         
|Operating
      Expenses:                  |  |                                  |  |                    |  |                          |  |         |  |               
|Advertising                                |  | 460,114                          |  | 138,302            |  | 2.0%                     |  | 0.7%    |  | 232.7%        
|Communications                             |  | 197,344                          |  | 123,922            |  | 0.8%                     |  | 0.6%    |  | 59.2%         
|                                           |  |                                  |  |                    |  |                          |  |         |  |               
|Total Selling
      Expenses               |  | 657,458                          |  | 262,224            |  | 2.8%                     |  | 1.3%    |  | 150.7%        
|Compensation
      and benefits            |  | 3,124,694                        |  | 2,203,390          |  | 13.4%                    |  | 10.5%   |  | 41.8%         
|Regulatory,
      legal and professional   |  | 573,941                          |  | 1,830,647          |  | 2.5%                     |  | 8.8%    |  | -68.6%        
|Occupancy                                  |  | 282,158                          |  | 255,928            |  | 1.2%                     |  | 1.2%    |  | 10.2%         
|Other
      administrative expenses        |  | 302,155                          |  | 286,064            |  | 1.3%                     |  | 1.4%    |  | 5.6%          
|Interest
      expense                     |  | 3,931                            |  | 4,621              |  | 0.0%                     |  | 0.0%    |  | -14.9%        
|                                           |  |                                  |  |                    |  |                          |  |         |  |               
|Total
      Administrative Expenses        |  | 4,286,879                        |  | 4,580,650          |  | 18.4%                    |  | 21.9%   |  | -6.4%         
|Total
      Operating Expenses             |  | 4,944,337                        |  | 4,842,874          |  | 21.2%                    |  | 23.2%   |  | 2.1%          
|                                           |  |                                  |  |                    |  |                          |  |         |  |               
|Operating
      Income (Loss)              |  | 135,806                          |  | (427,685)          |  | 0.6%                     |  | -2.0%   |  | N/A           
|                                          
|Income before
      taxes                  |  | 135,806                          |  | (427,685)          |  | 0.6%                     |  | -2.0%   |  | N/A           
|Provision
      (benefit) for income taxes |  | 83,585                           |  | (106,756)          |  | 0.4%                     |  | -0.5%   |  | N/A           
|                                           |  |                                  |  |                    |  |                          |  |         |  |               
|Net Income
      (Loss)                    |  | $
      52,221                   |  | $
      (320,929)  |  | 0.2%                     |  | -1.5%   |  | N/A           
|                                           |  |                                  |  |                    |  |                          |  |         |  |               

Management believes
that upgrading the overall quality of our independent representatives is key to
achieving robust growth in revenues and net income. Our experience has been that
increasing the technical qualifications and business practices of our
representatives not only generates more revenue, but assists in limiting the
cost of overhead functions and representative errors and misconduct. We strive
to continually improve the overall quality of our force of representatives
by:

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|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------

- recruiting high quality new representatives,
- terminating low quality representatives, and
- assisting representatives to improve their skills and practices.

A key metric that we use to assess the average quality of our representatives is average production generated per representative. Average production per representative increased by 12.9%, reflecting managements continuing emphasis on recruiting and retaining established, successful representatives who value the high level of service and support provided by ICC.

AVERAGE PRODUCTION PER REPRESENTATIVE

|                           |  | Quarters Ended December 31, |  |             
|-------------------------- |  | --------------------------- |  | ------------
|                           |  | 2007                        |  | 2006        
|                          
|Commission                 |  | $ 19,552,008                |  | $ 17,982,588
|Advisory                   |  | 2,752,804                   |  | 1,888,576   
|Other fee income           |  | 421,439                     |  | 402,410     
|                           |  |                             |  |             
|                           |  | $ 22,726,251                |  | $ 20,273,574
|                          
|Number of representatives  |  | 700                         |  | 705         
|                          
|Average Production Per Rep |  | $ 32,466                    |  | $ 28,757    

REVENUES

Revenues rose $2.36 million, or 11.3 %, to $23.27 million, led by a $1.57 million or 8.7% increase in commissions and a $0.86 million or 45.8% increase in advisory services revenue. Growth in revenue from brokerage and advisory services continues to be complimented by expanding revenues from other commission sources such as mutual funds, variable annuities and direct participation programs. Management looks to a diversified revenue stream to provide a degree of protection from market risk.

Commissions

Commissions from variable annuities continued to comprise the largest component of commission revenue, increasing 14.2% over the prior period. However, brokerage revenues, which posted a robust 31.7% increase, are fast approaching parity with revenues from variable annuities. Commission revenues from direct sales of mutual funds (denoted Mutual Funds below) eased 6.4% as mutual fund sales increasingly are being conducted through our trading platform. Commission revenues from direct participation programs decreased by 23.4% reflecting developments in the real estate sector.

|                                                                                                                      |  | Commission Revenue          |  |              |  |              |  |                 
|--------------------------------------------------------------------------------------------------------------------- |  | --------------------------- |  | ------------ |  | ------------ |  | ----------------
|                                                                                                                      |  | Quarters Ended December 31, |  |              |  |              |  |                 
|                                                                                                                     
|                                                                                                                      |  |                             |  |              |  |              |  | Percent of total
|Product Type1:                                                                                                        |  | 2007                        |  | 2006         |  | 2007 vs 2006 |  | Increase        
|Variable Annuities                                                                                                    |  | $ 7,233,181                 |  | $ 6,333,123  |  | $ 900,058    |  | 57.4%           
|Brokerage                                                                                                             |  | 7,068,402                   |  | 5,367,976    |  | 1,700,426    |  | 108.3%          
|Mutual Funds                                                                                                          |  | 2,449,842                   |  | 2,618,721    |  | (168,879)    |  | -10.8%          
|Direct Participation Programs                                                                                         |  | 2,747,409                   |  | 3,584,515    |  | (837,106)    |  | -53.3%          
|Other                                                                                                                 |  | 53,174                      |  | 78,253       |  | (25,079)     |  | -1.6%           
|                                                                                                                      |  |                             |  |              |  |              |  |                 
|                                                                                                                     
|Total Commission Revenue                                                                                              |  | $ 19,552,008                |  | $ 17,982,588 |  | $ 1,569,420  |  | 100.0%          
|                                                                                                                      |  |                             |  |              |  |              |  |                 
|                                                                                                                     
|1. Revenue designated as brokerage includes revenue from mutual funds sold through our trading platform. Revenue from |  |                            
|direct check and application sales of mutual funds are listed above under "Mutual Funds".                             |  |                             |  |              |  |             

We continue to emphasize recruitment and retention of representatives who seek to leverage our increasingly advanced technology. The utilization of sophisticated technology platforms allows us to more efficiently conduct business despite

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|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------

increasing volume. As discussed below, the recent trend of higher revenue growth from fee-based advisory services, compared to commission-based services, reflects parallel efforts by management to grow revenues in the investment advisory services area.

Advisory Fees

The firm has endeavored, in response to industry trends and increasing client demand, to assist our representatives in transitioning more of their business to advisory services. We do not dictate the nature or extent of advisory services our representatives provide for their clients. However, we continue to make concerted efforts to attract our representatives to our expanded line of proprietary advisory services programs through education, seminars, tradeshows and direct telemarketing.

Fees from our advisor-directed managed asset program, A-MAP, where investment advisory services are provided directly by our independent representatives, continue to be the leading source of advisory services revenue. Revenues from this program, which have been contributing an increasing proportion of advisory services revenue, grew by $0.60 million or 47.9% to $1.85 million compared to $1.25 million for the prior period. Supported by our Net Exchange Pro and Pershing direct on-line mainframe brokerage platforms, A-MAP is popular with our representatives because of the opportunities it provides to potentially deliver superior asset management services and overall investment performance at a lower cost. Resulting transactional cost savings have been passed on to our representatives clients in the form of lower fees for improved service.

Other Fee Income

Other fee income, which includes licensing and financial planning fees, was comparatively flat in comparing the current period to the prior period.

Marketing Revenue

Marketing revenues declined by $0.1 million reflecting a decrease in marketing support revenue for our East Coast National Convention.

Other Income

Other income, primarily interest, was approximately the same in the current period compared to the prior period.

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|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------

|GROSS MARGINS                                                                                                          |                            |  |                             |  |                            |  |                |  |        |  |        |  |         
|---------------------------------------------------------------------------------------------------------------------- | -------------------------- |  | --------------------------- |  | -------------------------- |  | -------------- |  | ------ |  | ------ |  | --------
|                                                                                                                      
|                                                                                                                       | Amount                     |  | % of Sales (Retention Rate) |  | % of Total Gross Margin    |  |               
|                                                                                                                       | Quarter Ended December 31, |  | Quarter Ended December 31,  |  | Quarter Ended December 31, |  | Percent Change
|                                                                                                                       |                            |  |                             |  |                            |  |               
|                                                                                                                       |                            |  |                             |  |                            |  |                |  |        |  |        |  | 2007    
|                                                                                                                       | 2007                       |  | 2006                        |  | 2007                       |  | 2006           |  | 2007   |  | 2006   |  | vs. 2006
|                                                                                                                       |                            |  |                             |  |                            |  |                |  |        |  |        |  |         
|Commissions:                                                                                                           |                            |  |                             |  |                            |  |                |  |        |  |        |  |         
|Check and Application                                                                                                  | $ 1,615,955                |  | $ 1,629,726                 |  | 13.0%                      |  | 13.0%          |  | 31.8%  |  | 36.9%  |  | -0.8%   
|Brokerage                                                                                                              | 1,956,135                  |  | 1,307,618                   |  | 27.7%                      |  | 24.4%          |  | 38.5%  |  | 29.6%  |  | 49.6%   
|Fixed Insurance                                                                                                        | 45,174                     |  | 59,798                      |  | 100.0%                     |  | 97.3%          |  | 0.9%   |  | 1.4%   |  | -24.5%  
|Underwriting                                                                                                           | 800                        |  | 1,679                       |  | 10.0%                      |  | 10.0%          |  | 0.0%   |  | 0.0%   |  | -52.4%  
|                                                                                                                       |                            |  |                             |  |                            |  |                |  |        |  |        |  |         
|Total                                                                                                                  | 3,618,064                  |  | 2,998,821                   |  |                            |  |                |  | 71.2%  |  | 67.9%  |  | 20.6%   
|                                                                                                                       |                            |  |                             |  |                            |  |                |  |        |  |        |  |         
|Advisory Services:                                                                                                     |                            |  |                             |  |                            |  |                |  |        |  |        |  |         
|A-MAP                                                                                                                  | 426,570                    |  | 367,618                     |  | 23.1%                      |  | 31.9%          |  | 8.4%   |  | 8.3%   |  | 16.0%   
|Other                                                                                                                  | 229,128                    |  | 103,777                     |  | n/a1                       |  | n/a1           |  | 4.5%   |  | 2.4%   |  | 120.8%  
|                                                                                                                       |                            |  |                             |  |                            |  |                |  |        |  |        |  |         
|Total                                                                                                                  | 655,698                    |  | 471,395                     |  | 23.2%                      |  | 24.2%          |  | 12.9%  |  | 10.7%  |  | 39.1%   
|                                                                                                                       |                            |  |                             |  |                            |  |                |  |        |  |        |  |         
|Licensing                                                                                                              | 342,193                    |  | 328,951                     |  | n/a1                       |  | n/a1           |  | 6.8%   |  | 7.5%   |  | 4.0%    
|Marketing                                                                                                              | 314,444                    |  | 427,425                     |  | n/a1                       |  | n/a1           |  | 6.2%   |  | 9.6%   |  | -26.4%  
|Other Income                                                                                                           | 149,744                    |  | 188,597                     |  | n/a                        |  | n/a            |  | 2.9%   |  | 4.3%   |  | -20.6%  
|                                                                                                                       |                            |  |                             |  |                            |  |                |  |        |  |        |  |         
|Total Gross Margin                                                                                                     | 5,080,143                  |  | 4,415,189                   |  | 21.8%                      |  | 21.1%          |  | 100.0% |  | 100.0% |  | 15.1%   
|                                                                                                                       |                            |  |                             |  |                            |  |                |  |        |  |        |  |         
|1. Due to account composition of various products, profit margin retention is not a relevant indicator of performance. |                            |  |                             |  |                            | 

Gross margin rose by $0.66 million or 15.1% to $5.08 million. This increase was due to a $0.65 million or 49.6% increase in gross margin derived from brokerage, partially offset by a decline in margins from our check and application programs, fixed insurance and underwriting. We also continued to experience steady growth in our investment advisory programs, including $.059 million and $0.13 million revenue increases, respectively, from our representative-directed A-MAP program and our other investment advisory programs.

Check and Application

Gross margins from our check and application distribution programs eased slightly to $1.62 million. This stems mostly from a decrease in our direct participation programs from real estate investment trusts (REITS) due to the decline in the real estate market. Please refer to the Commission Revenue Schedule above.

The percentage contribution of check and application to total gross margins slipped from 36.9% to 31.8% principally due to a substantial increase in gross margins generated by brokerage services.

Brokerage Services

The 49.6% growth posted in brokerage services profit margin reflected a $0.50 million increase in gross margins from brokerage activities that required a commission payout which contributed to a 3.3% decrease in the costs of brokerage revenue as a percentage of total brokerage revenue.

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|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------

Brokerage services were the leading contributor to our growth in gross margin. Overall margin retention on brokerage services increased from 24.4% in the prior period to 27.7% .

Advisory Services

Gross margin from our A-MAP rep-directed managed assets program registered a 16.0% increase primarily as a result from growth in assets under management in the program that, in managements opinion, is due primarily to lower fees, improved services and increased awareness of this program.

Continuing a recent trend, profit margin from non-AMAP advisory programs rose substantially, on a percentage basis, increasing by 120.8% to $0.23 million. This category includes both third-party and ICA-directed investment advisory programs. The Company is continuing its efforts to bring on additional proprietary investment advisory products that emphasize improved service at lower fee levels and are designed to attract representatives with substantial amounts of client assets under management.

Commission and Advisory Fees Expenses / Retention

Management is continuing their efforts to improve margin contribution by recruiting and retaining sophisticated representatives who are duly licensed to offer a variety of brokerage and advisory products and services. Payouts to our independent representatives, when combined with other advisory and brokerage services costs, decreased to 80.0% of representative-generated revenue, compared to 81.4% for the prior period. The corresponding increase in our retention rate from 18.6% to 20.0% reflects a transitioning of our direct business (check and application) to our more efficient brokerage and advisory services.

OPERATING EXPENSES

Operating expenses, which rose 2.1% to $4.94 million, are discussed in detail below.

Compensation and Benefits

The largest component of operating expenses, compensation and benefits, increased by $0.92 million or 41.8% . This stems mostly from a $0.56 million increase in general salaries incurred primarily in hiring additional IT, recruitment and accounting personnel of which approximately one third of this increase came in the form of bonuses. In addition, officer compensation increased by $0.28 million primarily due to executive bonuses.

Regulatory, Legal and Professional

Regulatory, legal and professional expenses decreased by $1.26 million or 68.6% . The largest component of this decrease was a $1.46 million decrease in legal fees and settlement costs of which $1.56 million was associated with the settlement of the Massachusetts Proceedings. Management believes, although there can be no assurances, that the Massachusetts Proceedings will prove to be atypical, in terms of financial impact, of legal proceedings that will be generated in the future in connection with our on-going operations.

Legal fees and settlement costs, other than those associated with the Massachusetts Proceedings, increased by $0.10 million. Management believes this result is directly attributable to the Companys risk-based management approach that seeks to minimize risk by improving the quality of its associated registered representatives while committing resources to educate and train our sales force, efficiently and accurately process their business, and appropriately supervise their business activities.

The Company will continue to incur legal fees and settlement costs as it operates in an increasingly litigious industry embedded with regulation. Consequently, the Company will continue to invest significant resources to reduce the likelihood of future litigation exposure by promoting accuracy, ensuring sound operational techniques and applying appropriate compliance measures.

Advertising

Advertising, including related marketing expenses, increased by $0.32 million or 232.7% . Management has been aggressively brand building, placing advertisements in financial services trade publications to communicate to potential representative recruits the role that our customer service, technology infrastructure and back office support can play in helping maintain and grow their businesses.

Communications

Communications expenses increased by $0.07 million or 59.2% . Communication efforts and related expenses, which also include investor/public relations, conference and telephone, have historically been positively correlated with the overall

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|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------

growth of our business. Our website and newsletter, "The Capitalist", have become effective media to communicate to qualified representative recruitment prospects.

Occupancy

Occupancy expenses increased by $0.03 million or 10.2% resulting from an increase in depreciation due to acquiring additional fixed assets in the form of new computers for additional staff, leasehold improvements and additional furniture and fixtures for the home office in Lynnfield, MA to accommodate the increased number of employees.

Other Administrative

Other administrative expenses, which include various insurance, postage, office and computer-related expenses, increased by $0.02 million or 5.6% primarily due to computer maintenance and software upgrade costs and credit card processing fees related to the collection of license renewal fees.

NET INCOME

Net income totaled $0.05 million, or $.01 per basic and diluted share, compared to a net loss of $0.32 million, or $.05 per basic share, loss for the prior period. The improvement in after-tax results was due to a favorable $0.37 million swing in operating income (loss) partially offset by a countervailing $0.19 million swing in provision (benefit) for income tax. The turnaround in operating income (loss) reflects both substantial increases in revenues and substantial reductions in operating expenses, particularly, regulatory/legal expenses.

COMPARISON OF THE NINE MONTH PERIODS ENDED DECEMBER 31, 2007 AND 2006

Results reported for the current nine-month period compared to the year ago nine-month period are discussed below to the extent that explanations for comparative variances in year to date results differ from the explanations for comparative quarterly results discussed above. Please refer to the comparative quarterly results analysis for a general explanation of variances concerning the current nine-month period that are not discussed below.

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|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------

|RESULTS OF OPERATIONS                 |  |              |  |                                |  |              |  |                   |  |        |  |                    |  |         
|------------------------------------- |  | ------------ |  | ------------------------------ |  | ------------ |  | ----------------- |  | ------ |  | ------------------ |  | --------
|                                      |  |              |  |                                |  |              |  |                   |  |        |  | Percent of Revenue |  |         
|                                      |  |              |  |                                |  |              |  |                   |  |        |  | Nine Months Ended  |  | Percent 
|                                      |  |              |  | Nine Months Ended December 31, |  | December 31, |  | Change           
|                                      |  |              |  |                                |  |              |  |                  
|                                      |  |              |  |                                |  |              |  |                   |  |        |  |                    |  |         
|                                      |  |              |  | 2007                           |  |              |  | 2006              |  | 2007   |  | 2006               |  | vs. 2006
|                                      |  |              |  |                                |  |              |  |                   |  |        |  |                    |  |         
|Revenues:                             |  |              |  |                                |  |              |  |                   |  |        |  |                    |  |         
|Commission                            |  | $ 59,227,984 |  | $ 50,730,928                   |  | 85.7%        |  | 87.8%             |  | 16.7% 
|Advisory fees                         |  |              |  | 7,459,340                      |  |              |  | 4,901,072         |  | 10.8%  |  | 8.5%               |  | 52.2%   
|Other fee income                      |  |              |  | 694,399                        |  |              |  | 598,443           |  | 1.0%   |  | 1.0%               |  | 16.0%   
|Marketing revenue                     |  |              |  | 1,043,808                      |  |              |  | 956,371           |  | 1.5%   |  | 1.7%               |  | 9.1%    
|Other income                          |  |              |  | 679,424                        |  |              |  | 584,902           |  | 1.0%   |  | 1.0%               |  | 16.2%   
|                                      |  |              |  |                                |  |              |  |                   |  |        |  |                    |  |         
|Total Revenue                         |  |              |  | 69,104,955                     |  |              |  | 57,771,716        |  | 100.0% |  | 100.0%             |  | 19.6%   
|                                      |  |              |  |                                |  |              |  |                   |  |        |  |                    |  |         
|Commission and advisory expenses      |  |              |  | 55,343,761                     |  |              |  | 46,453,981        |  | 80.1%  |  | 80.4%              |  | 19.1%   
|Gross Profit                          |  |              |  | 13,761,194                     |  |              |  | 11,317,735        |  | 19.9%  |  | 19.6%              |  | 21.6%   
|Operating Expenses:                   |  |              |  |                                |  |              |  |                   |  |        |  |                    |  |         
|Advertising                           |  |              |  | 1,155,808                      |  |              |  | 639,727           |  | 1.7%   |  | 1.1%               |  | 80.7%   
|Communications                        |  |              |  | 712,370                        |  |              |  | 324,323           |  | 1.0%   |  | 0.6%               |  | 119.6%  
|                                      |  |              |  |                                |  |              |  |                   |  |        |  |                    |  |         
|Total Selling Expenses                |  |              |  | 1,868,178                      |  |              |  | 964,050           |  | 2.7%   |  | 1.7%               |  | 93.8%   
|Compensation and benefits             |  |              |  | 7,181,897                      |  |              |  | 6,629,987         |  | 10.4%  |  | 11.5%              |  | 8.3%    
|Regulatory, legal and professional    |  |              |  | 1,500,833                      |  |              |  | 3,763,689         |  | 2.2%   |  | 6.5%               |  | -60.1%  
|Occupancy                             |  |              |  | 877,545                        |  |              |  | 721,436           |  | 1.3%   |  | 1.2%               |  | 21.6%   
|Other administrative expenses         |  |              |  | 876,838                        |  |              |  | 774,963           |  | 1.3%   |  | 1.3%               |  | 13.1%   
|Interest expense                      |  |              |  | 38,147                         |  |              |  | 20,223            |  | 0.1%   |  | 0.0%               |  | 88.6%   
|                                      |  |              |  |                                |  |              |  |                   |  |        |  |                    |  |         
|Total Administrative Expenses         |  |              |  | 10,475,260                     |  |              |  | 11,910,298        |  | 15.2%  |  | 20.6%              |  | -12.0%  
|Total Operating Expenses              |  |              |  | 12,343,438                     |  |              |  | 12,874,348        |  | 17.9%  |  | 22.3%              |  | -4.1%   
|                                      |  |              |  |                                |  |              |  |                   |  |        |  |                    |  |         
|Operating Income (Loss)               |  |              |  | 1,417,756                      |  |              |  | (1,556,613)       |  | 2.1%   |  | -2.7%              |  | N/A     
|                                     
|Income before taxes                   |  |              |  | 1,417,756                      |  |              |  | (1,556,613)       |  | 2.1%   |  | -2.7%              |  | N/A     
|Provision (benefit) for income taxes  |  |              |  | 639,919                        |  |              |  | (468,227)         |  | 0.9%   |  | -0.8%              |  | N/A     
|                                      |  |              |  |                                |  |              |  |                   |  |        |  |                    |  |         
|Net Income (Loss)                     |  | $ 777,837    |  | $ (1,088,386)                  |  | 1.1%         |  | -1.9%             |  | N/A   
|                                      |  |              |  |                                |  |              |  |                   |  |       
|                                     
|AVERAGE PRODUCTION PER REPRESENTATIVE |  |              |  |                                |  |             
|                                      |  |              |  | Nine Months Ended December 31, |  |              |  |                  
|                                      |  |              |  | 2007                           |  | 2006         |  | Percentage Change |  |       
|Commission                            |  |              |  | $ 59,227,984                   |  | $ 50,730,928 |  | 16.7%             |  |       
|Advisory                              |  |              |  |                                |  |              |  | 7,459,340         |  |        |  | 4,901,072          |  | 52.2%   
|Other fee income                      |  |              |  |                                |  |              |  | 694,399           |  |        |  | 598,443            |  | 16.0%   
|                                      |  |              |  |                                |  |              |  |                   |  |       
|                                      |  |              |  | $ 67,381,723                   |  | $ 56,230,443 |  | 19.8%             |  |       
|                                      |  |              |  |                                |  |              |  |                   |  |       
|Actual number of representatives      |  |              |  |                                |  |              |  | 700               |  |        |  | 705                |  | -0.7%   
|Average Revenue Per Rep               |  |              |  | $ 96,260                       |  | $ 79,759     |  | 20.7%             |  |       

REVENUES

Revenues increased by $11.33 million or 19.6% for the nine-month comparative period as top line revenue grew 16.7 % in commissions and 52.2% in advisory fees over the same time frame a year ago.

Commissions

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|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------

|                                                                                                                                |  |                                              |  | Commission Revenue |  |              |  |                  |  |                  
|------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------------------- |  | ------------------ |  | ------------ |  | ---------------- |  | -----------------
|                                                                                                                                |  | Nine Months Ended December 31, 2007 and 2006 |  |                    |  |             
|                                                                                                                               
|                                                                                                                                |  |                                              |  |                    |  |              |  | Percent of total |  | Percentage change
|Product Type1:                                                                                                                  |  | 2007                                         |  | 2006               |  | 2007 vs 2006 |  | Increase         |  | 2007 vs 2006     
|                                                                                                                                |  |                                              |  |                    |  |              |  |                  |  |                  
|Variable Annuities                                                                                                              |  | $ 22,953,332                                 |  | $ 19,479,259       |  | $ 3,474,073  |  | 40.9%            |  | 17.8%            
|Brokerage                                                                                                                       |  | 19,273,273                                   |  | 15,196,897         |  | 4,076,376    |  | 47.9%            |  | 26.8%            
|Mutual Funds                                                                                                                    |  | 8,345,071                                    |  | 7,469,907          |  | 875,164      |  | 10.3%            |  | 11.7%            
|Direct Participation Programs                                                                                                   |  | 8,463,467                                    |  | 8,194,152          |  | 269,315      |  | 3.2%             |  | 3.3%             
|Other                                                                                                                           |  | 192,841                                      |  | 390,713            |  | (197,872)    |  | -2.3%            |  | -50.6%           
|                                                                                                                                |  |                                              |  |                    |  |              |  |                  |  |                  
|                                                                                                                               
|Total Commission Revenue                                                                                                        |  | $ 59,227,984                                 |  | $ 50,730,928       |  | $ 8,497,056  |  | 100.0%           |  | 16.7%            
|                                                                                                                                |  |                                              |  |                    |  |              |  |                  |  |                  
|                                                                                                                               
|1. Revenue designated as Brokerage (Trading) includes revenue from mutual funds sold through our trading platform. Revenue from |  |                                             
|direct check and application sales of mutual funds are listed above under "Mutual Funds".                                       |  |                                              |  |                    |  |             

Brokerage revenue experienced the largest percentage growth while commissions from variable annuity sales continued to be the leading revenue component. This current growth trend in brokerage revenue is indicative of our refined business model of attracting highly sophisticated representatives who can potentially flow through a well diversified book of business.

Advisory Fees

The 52.2% growth in advisory fees was aided by a $1.78 million increase in revenue from our A-MAP program, reflecting our efforts to service and improve a quality product at reduced fees.

Other Fee Income

Other fee income increased by 16.0% or $0.10 million compared to the year ago period. The growth in other fee income reflects an increase in planning fees as more of our qualified representatives are providing consulting services to better assist clients in managing their portfolios.

Marketing Revenue

Marketing revenues grew by 9.1 % or $0.09 million over the prior period. This growth is primarily due to the increase in marketing support revenue resulting from product sales.

Other Income

Other Income grew by 16.2% or $0.09 million over the year ago period reflecting an increase in interest income.

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|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------

|GROSS MARGINS                                                                                                              |  |                    |  |                             |  |                         |  |          |  |        |  |        |  |         
|-------------------------------------------------------------------------------------------------------------------------- |  | ------------------ |  | --------------------------- |  | ----------------------- |  | -------- |  | ------ |  | ------ |  | --------
|                                                                                                                           |  | Amount             |  | % of Sales (Retention Rate) |  | % of Total Gross Margin |  |         
|                                                                                                                           |  | Nine Months        |  | Nine Months Ended           |  | Nine Months Ended       |  |         
|                                                                                                                           |  | Ended December 31, |  | December 31,                |  | December 31,            |  | % Change
|                                                                                                                           |  |                    |  |                             |  |                         |  |         
|                                                                                                                           |  |                    |  |                             |  |                         |  |          |  |        |  |        |  | 2007    
|                                                                                                                           |  | 2007               |  | 2006                        |  | 2007                    |  | 2006     |  | 2007   |  | 2006   |  | vs. 2006
|                                                                                                                           |  |                    |  |                             |  |                         |  |          |  |        |  |        |  |         
|Commissions:                                                                                                               |  |                    |  |                             |  |                         |  |          |  |        |  |        |  |         
|Check & Application                                                                                                        |  | $ 5,169,040        |  | $ 4,506,219                 |  | 13.0%                   |  | 12.9%    |  | 37.6%  |  | 39.8%  |  | 14.7%   
|Brokerage                                                                                                                  |  | 4,789,497          |  | 3,298,600                   |  | 24.9%                   |  | 21.7%    |  | 34.9%  |  | 29.1%  |  | 45.2%   
|Fixed Insurance                                                                                                            |  | 130,654            |  | 189,551                     |  | 100.0%                  |  | 99.0%    |  | 0.9%   |  | 1.7%   |  | -31.1%  
|Underwriting                                                                                                               |  | 6,219              |  | 19,917                      |  | 10.0%                   |  | 10.0%    |  | 0.0%   |  | 0.2%   |  | -68.8%  
|                                                                                                                           |  |                    |  |                             |  |                         |  |          |  |        |  |        |  |         
|Total                                                                                                                      |  | 10,095,410         |  | 8,014,287                   |  |                         |  |          |  | 73.4%  |  | 70.8%  |  | 26.0%   
|                                                                                                                           |  |                    |  |                             |  |                         |  |          |  |        |  |        |  |         
|Advisory Services:                                                                                                         |  | -                  |  | -                           |  |                         |  |          |  |        |  |        |  |         
|A-MAP                                                                                                                      |  | 1,120,785          |  | 761,736                     |  | 22.3%                   |  | 26.0%    |  | 8.1%   |  | 6.7%   |  | 47.1%   
|Other                                                                                                                      |  | 567,810            |  | 615,204                     |  | n/a1                    |  | n/a1     |  | 4.1%   |  | 5.4%   |  | -7.7%   
|                                                                                                                           |  |                    |  |                             |  |                         |  |          |  |        |  |        |  |         
|Total                                                                                                                      |  | 1,688,595          |  | 1,376,940                   |  | 22.0%                   |  | 25.8%    |  | 12.2%  |  | 12.1%  |  | 22.6%   
|                                                                                                                           |  |                    |  |                             |  |                         |  |          |  |        |  |        |  |         
|Licensing                                                                                                                  |  | 471,261            |  | 465,575                     |  | n/a1                    |  | n/a1     |  | 3.4%   |  | 4.1%   |  | 1.2%    
|Marketing                                                                                                                  |  | 1,043,808          |  | 956,372                     |  | n/a1                    |  | n/a1     |  | 7.6%   |  | 8.5%   |  | 9.1%    
|Other income                                                                                                               |  | 462,120            |  | 504,561                     |  | n/a1                    |  | n/a1     |  | 3.4%   |  | 4.5%   |  | -8.4%   
|                                                                                                                           |  |                    |  |                             |  |                         |  |          |  |        |  |        |  |         
|Total Gross Margin                                                                                                         |  | 13,761,194         |  | 11,317,735                  |  | 19.9%                   |  | 19.6%    |  | 100.0% |  | 100.0% |  | 21.6%   
|                                                                                                                           |  |                    |  |                             |  |                         |  |          |  |        |  |        |  |         
|1. Due to account composition, profit margin retention for these products is not deemed a useful indicator of performance. |  |                    |  |                            
|                                                                                                                           |  |                    |  |                             |  |                         |  |          |  |        |  |        |  |         

****

**Check and Application**

Gross profit from our direct business (check and application) continued to make the largest contribution to margins, registering a $0.66 increase; however, it decreased slightly as a percentage of total gross margin due to more rapid growth in brokerage gross margins.

Brokerage Services

Brokerage services profit margin grew by 45.2% or $1.49 million, including a $1.10 million increase in margin from commissionable brokerage activities.

Advisory Services

Advisory services profit margin grew by $0.31 million or 22.6% led by a $0.36 million or 47.1% rise in gross margin generated by our A-MAP rep-directed managed assets program.

Commission and Advisory Fees Expenses

Commission and advisory fees expenses during the current nine-month period were $55.34 million versus $46.45 million in the prior period. As a percentage of revenue generated by representatives (i.e., commissions, advisory fees and other fees), commission and advisory expenses decreased slightly from 82.6% to 82.1% . These expenses include commissions to representatives, clearing costs and other direct costs that are necessary to produce revenue. Management continuously monitors these costs as they have a substantial effect on our profit margin.

OPERATING EXPENSES

Operating expenses decreased by 4.1% primarily due to a substantial decrease in regulatory, legal and professional services.

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|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------

Compensation and Benefits

Compensation and benefits rose by 8.3% due to the hiring of additional personnel as well as the award of approximately $0.80 million in bonuses and
incentive stock, the net effect of which was partially offset by prior period restricted stock awards to key management and staff.

Regulatory, Legal and Professional

The 60.1% decrease in this expense category stems principally from a steep decline in legal fees incurred in our defense and settlement of the
Massachusetts Proceedings which approximated $2.20 million in the prior period. The Company also received in the current period insurance proceeds reimbursing certain prior period arbitration settlement costs.

Advertising

The Companys advertising expenses increased by 80.7% over the prior period as management has been aggressively placing advertisements in financial
service periodicals to enhance recruitment of independent representatives and promote our provision of quality broker/dealer customer services to our independent financial representatives

Communications

Communication expenses rose by 119.6% principally due to commitment of resources to two conferences for representatives held in the current period to
stimulate revenue growth in advisory services and from our top producers. In addition the company committed resources to enhancement of our website to communicate to our representatives updates on the industrys rules and regulations and to add
a portfolio consolidation tool.

Occupancy

Occupancy expenses increased by 21.6% in the current period versus the year ago nine-month period reflecting the opening of new investment centers along
with the acquiring of additional fixed assets

Other Administrative

Other administrative expenses increased in the current period by 13.1% versus the prior period primarily due to a FINRA fine regarding our EMAIL
domain.

NET INCOME

The Company experienced a profit turnaround for the nine-month period in comparison to the prior period. We continued to grow top line revenues in the
high margin areas while reducing operating expenses, primarily in legal expenses. Management believes that the $1.87 million improvement in after tax net results in the current period compared to the prior period demonstrates the viability of
our current business model, which stresses recruitment of high-producing representatives and reduction of regulatory risk that has negatively impacted the firm in the past.



|LIQUIDITY AND CAPITAL RESOURCES
|-------------------------------

The Company believes that achieving its return on equity goals requires the efficient use of capital. We have financed our operations primarily with
internally generated cash flow.

Cash inflows typically have come primarily from the Companys core broker-dealer and investment advisory services. Our business operations
historically have proven profitable on a yearly basis.  An exception was the fiscal year ended March 31, 2007, during which $2.20 million of costs were incurred in connection with the Massachusetts Proceedings. With the settlement of these
proceedings in December 2006, management believes, although there can be no assurances, that the profits and positive cash flows achieved in the last two fiscal quarters mark the return of long-term, sustainable profitability and positive cash
flow.

Our historic profitability typically has followed an annual cycle of relatively average profitability during the first and third fiscal quarters,
relatively low profitability (or even a loss) during the second fiscal quarter (when many representatives and their clients are on summer vacation), and relatively high profitability during the fourth fiscal quarter (when many representatives and
their clients start a new business and investment year).

Negative fluctuations and general uncertainty in financial markets can have a negative impact on cash flow. The Company works to minimize this impact by
aggressively recruiting sophisticated representatives who can offer diversified products that continue to meet the needs of their clients despite changing market conditions.

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|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------

The Company takes a proactive approach to minimizing the occurrence and impact of other events that may lead to unexpected cash outflows, including legal proceedings, trade errors, and fines and other sanctions imposed by regulatory agencies such as FINRA, the SEC and state securities regulators. Accordingly, the Company has been allocating increasing resources to stay current with the many rules and regulations applicable to our business and to provide up-to-date education and training to our staff and independent representatives. A key to this approach is ensuring that adequate controls over our operations and those of our representatives are implemented and periodically updated. As part of this effort, substantial resources have been committed to enhancing the capabilities of our compliance team, whose tasks include assuring that our representatives give proper weight to the circumstances and interests of their clients when recommending investment options.

As of December 31, 2007, cash and cash equivalents totaled $5.54 million compared to $5.50 million as of March 31, 2007. Working capital as of December 31, 2007 was $7.36 million compared to $5.32 million as of March 31, 2007. The ratio of current assets to current liabilities was 2.24 to 1 as of December 31, 2007 compared to 1.80 to 1 as of March 31, 2007.

Operations provided cash flow of $0.61 million for the nine months ended December 31, 2007 compared to $0.92million for the nine months ended December 31, 2006. Cash flow from operations, in comparing the current period to the prior period, generated a decrease to cash flow of $0.31 million as a result of several factors.

We experienced a $1.87 million increase in cash flow because of the change in net income as the Company reported a $0.78 million profit in the current period versus a $1.09 million loss in the prior period. Offsetting this increase was a $1.33 million decrease in cash flow from the payment of accrued expenses, primarily related to preferred marketing events and litigation in the current period versus an increase in accrued expenses in the prior period pertaining to the Massachusetts Proceedings.

Cash inflows from investing activities for the current period totaled $0.21 million, as three treasury notes matured during the current period in the amount of $0.75 million offset by the purchase of a certificate of deposit of $.25 million. In addition, we invested $0.23 million in property and equipment, and computer software. Finally we experienced a $0.83 million decrease in cash flow from financing activities during the current period pertaining to a short-term obligation for insurance premiums.

By comparison, for the nine months ended December 31, 2006, cash provided by operations was $0.92 million. Cash outflows for the prior period included $0.71 million for purchasing equipment, software and leasehold improvements. In addition, the Company had invested $1.98 million in U.S Treasury bills and notes. Finally, from financing activities we paid a $0.25 million cash dividend on June 29, 2006 to shareholders of record as of June 15, 2006.

Cash disbursements contributing significantly to cash outflows during our most recent quarter included $0.30 million for legal-related matters, of which $0.11 million was for payments made to the eligible purchasers as part of the settlement of the Massachusetts Proceedings. In addition, the Company had disbursed approximately $0.24 million for our East Coast National Conference and $0.18 million towards other events for 2008. Finally we paid out approximately $0.25 million for health insurance, portfolio consolidation services, and equipment and software purchases.

Cash disbursements can have a material impact on our Brokerage firms net capital. The SEC Uniform Net Capital Rule (Rule 15c3-1) requires that ICC, our broker-dealer subsidiary, maintain net capital of $100,000 and a ratio of aggregate indebtedness to net capital (a net capital ratio) not to exceed 15 to 1. Under the rule, indebtedness generally includes all money owed by ICC, and net capital includes ICC cash and assets that are easily converted into cash. SEC rules also prohibit "equity capital" (which, under the net capital rule, includes subordinated loans) from being withdrawn, cash dividends from being paid and other specified actions of similar effect from being taken, if, among other specified contingencies, ICCs net capital ratio would exceed 10 to 1 or if ICC would have less than 120% of its minimum required net capital. As of December 31, 2007 ICC had net capital of $1.59 million (i.e., an excess of $1.06 million) and a4.96 to 1net capital ratio as compared to net capital of $1.05 million (i.e., an excess of $0.52 million) and a 7.59 to 1 net capital ratio as of March 31, 2007.

The Companys legal accrual decreased to $0.55 million from $1.30 million in comparing the current period to the prior period as a result of payments of accrued expenses incurred in the prior period pertaining to the Massachusetts Proceedings and various arbitrations filed against the Company. The period for filing investor claims pursuant to the settlement of the Massachusetts Proceedings having expired on December 31, 2007, the Company has ceased to further accrue legal expenses pertaining to the settlement beyond the $0.19 million to be paid to the State, which equals the amount by which $0.50 million exceeds the total of all investor claims. Accordingly, it is not anticipated that there will be any further impact on ICCs net capital ratio and excess net capital attributable to the settlement. The Company believes that it currently has ample cash to cover anticipated additional accruals and disbursements resulting from legal arbitrations and proceedings.

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|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------

|CONTRACTUAL OBLIGATIONS      
|-----------------------------
|                             
|Contractual Obligations      
|                             
|Period                       
|                             
|Fiscal Years Ended March 31, 
|                             
|                             
|Operating leases:            
|                             
|Total Contractual Obligations
|                             



|COMMITMENTS AND CONTINGENCIES
|-----------------------------

The Company is obligated under various lease agreements covering offices and equipment. These agreements are considered to be operating leases in accordance with the requirements under FASB 13 "Accounting for Leases". The terms of the leases expire between fiscal year 2008 and 2012. Options to renew for additional terms are included under the lease agreements. The total minimum rental due in future periods under these existing agreements is as follows as of March 31, 2007:

|Year ending March 31, 2008   |  | $ 149,596  
|---------------------------- |  | -----------
|Year ending March 31, 2009   |  | 498,347    
|Year ending March 31, 2010   |  | 387,929    
|Year ending March 31, 2011   |  | 347,554    
|Year ending March 31, 2012   |  | 324,112    
|                             |  |            
|                            
|Total minimum lease payments |  | $ 1,707,538
|                             |  |            

Certain leases contain provisions for escalation of minimum lease payments contingent upon increases in real estate taxes.

Total lease expense amounted to $178,564 and $163,564 for quarters ended December 31, 2007 and 2006, respectively, and for nine months ended December 31, 2007 and 2006 total lease expense was $532,706 and $463,765, respectively.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market risk is present in our business due to, among other things, price changes in equities, changes in interest rates, and credit ratings in debt instruments. This risk relates both to financial instruments we hold as investments and those we hold for Brokerage purposes.

As of December 31, 2007, we held U.S. Treasury bonds with an amortized value totaling $996,856. Although we intend to hold these bonds to maturity, if we determined to liquidate our position in these bonds prior to maturity the proceeds from their sale would depend on fluctuations in their market value that reflect, among other things, fluctuations in prevailing interest rates.

We own an equity position in the Rising Dividend Fund with a market value of $185,638 as of December 31, 2007. The value of this position fluctuates daily.

Market risk is present in our normal business activity as a result of our involvement as principal in the execution of brokerage activity and delivery of fixed and variable investment products. Securities inventories are exposed to risk of loss in the event of unfavorable price movements. Securities positions are marked to market on a daily basis. Market making activities are client driven, with the objective of meeting client needs while earning a positive spread. As of December 31, 2007, we held securities both long and short positions valued at $251,199. We conduct our business as a brokerage and advisory firm clearing through another broker dealer on a fully disclosed basis to minimize our market risk. In our view,

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|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------

exposure to market risk, trading volatility and illiquidity of securities held from time to time in the firms inventory accounts could potentially have a material adverse effect
on our financial position.

ITEM 4. CONTROLS AND PROCEDURES

Based on an evaluation by our management in which they or persons performing similar functions participated, our principal executive and financial
officers have concluded that controls and procedures in place as of the end of the period covered by this report were effective (i) for the purpose of ensuring that information required to be disclosed in our reports filed under the Securities
Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission, and (ii) for the purpose of ensuring that material information required to be in
a report is made known to management and others, as appropriate, to allow timely decisions regarding required disclosures.



|PART II. OTHER INFORMATION
|--------------------------

ITEM 1. LEGAL PROCEEDINGS

The Company operates in a highly litigious and regulated business and, as such, is a defendant or codefendant in various lawsuits and arbitrations
incidental to its securities business. The Company is vigorously contesting the allegations of the complaints in these cases and believes that there are meritorious defenses in each. Counsel is unable to respond concerning the likelihood of an
outcome, whether favorable or unfavorable, because of inherent uncertainty routine in these matters. For the majority of pending claims, the Company's errors and omissions (E&O) policy limits the maximum exposure in any one case to between
$75,000 and $100,000 and, in certain of these cases, the Company has the contractual right to seek indemnity from related parties. Management, in consultation with counsel, believes that resolution of pending litigation will not have a
material adverse effect on the consolidated financial results of the Company.



|ITEMS 1A  3.None.
|------------------

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

None.



|ITEM 5. OTHER INFORMATIONNone.
|------------------------------

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|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------

|ITEM 6. EXHIBITS |  |                                                                        
|---------------- |  | -----------------------------------------------------------------------
|Exhibit          |  |                                                                        
|Number           |  | Description                                                            
|3.1              |  | Certificate of Incorporation                                           
|3.2              |  | By-Laws                                                                
|4.1              |  | Form of Stock Certificate                                              
|10.1             |  | Employment Agreement with Theodore E. Charles                          
|10.2             |  | Employment Agreement with Timothy B. Murphy                            
|10.3             |  | The 1994 Stock Option Plan                                             
|10.4             |  | The 2005 Equity Incentive Plan                                         
|31.1             |  | Certification of Theodore E. Charles pursuant to Rule 13a-14(a)        
|31.2             |  | Certification of Timothy B. Murphy pursuant to Rule 13a-14(a)          
|32.1             |  | Certification of Theodore E. Charles pursuant to 18 U.S.C. Section 1350
|32.2             |  | Certification of Timothy B. Murphy pursuant to 18 U.S.C. Section 1350  

|(1) | Filed herewith.                                                                                                                                       
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) | Incorporated by reference to the indicated exhibit to the Registrants Quarterly Report on Form 10-Q for the quarter ended September 30, 2007.        
|   
|(3) | Incorporated by reference to the indicated exhibit to the Registrants Registration Statement on Form SB-2 (File No. 333-05327) filed August 14, 2000.
|   
|(4) | Incorporated by reference to the indicated exhibit to the Registrants Annual Report on Form 10-K for the year ended March 31, 2005.                  
|   
|(5) | Incorporated by reference to the indicated exhibit to the Registrants Registration Statement on Form S-8 (File No. 333-43664) filed June 9, 2006     
|   

Any exhibit not included with this Form 10-Q will be furnished to any stockholder of record upon written request and payment of up to $.25 per page plus postage. Such requests should be directed to Investors Capital Holdings, Ltd., 230 Broadway East, Lynnfield, MA 01940-2320, Attention: Corporate Secretary.

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|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------



|SIGNATURES
|----------

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



| | INVESTORS CAPITAL HOLDINGS, LTD.By:/s/ Timothy B. MurphyChief Financial Officer
Date: February 14, 2008
| | -------------------------------------------------------------------------------------------------------



|
|

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|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------



|Exhibit 31.1CERTIFICATION
|-------------------------



|I, Theodore E. Charles, certify that:
|-------------------------------------

|1. | I have reviewed this quarterly report on Form 10-Q of Investors Capital Holdings, Ltd.;                                                                                                                                                                                                                   
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|  
|3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in said report;                   
|  
|4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e) for the registrant and have:                                                                             
|  
|   | a)                                                                                                                                                                                                                                                                                                        
|  
|   | b)                                                                                                                                                                                                                                                                                                        
|  
|   | c)                                                                                                                                                                                                                                                                                                        
|  
|   | d)                                                                                                                                                                                                                                                                                                        
|  
|5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):        
|  
|   | a)                                                                                                                                                                                                                                                                                                        
|  
|   | b)                                                                                                                                                                                                                                                                                                        
|  



|Date: February 14, 2008By: /s/ Theodore E. CharlesTheodore E. Charles, Chairman,Chief Executive Officer and Director(principal executive officer)
|-------------------------------------------------------------------------------------------------------------------------------------------------

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|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------



|Exhibit 31.2CERTIFICATION
|-------------------------



|I, Timothy B. Murphy, certify that:
|-----------------------------------

|1. | I have reviewed this quarterly report on Form 10-Q of Investors Capital Holdings, Ltd.;                                                                                                                                                                                                                   
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|  
|3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in said report;                   
|  
|4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e) for the registrant and have:                                                                             
|  

|a) |  | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be        
|-- |  | -----------------------------------------------------------------------------------------------------------------
|   |  | designed under our supervision, to ensure that material information relating to the registrant, including its    
|   |  | consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in
|   |  | which this report is being prepared;                                                                             

|   | b)                                                                                                                                                                                                                                                                                                 | Not applicable.                                                                                                                                                                                                                                                                                                                                                                 
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|   | c)                                                                                                                                                                                                                                                                                                 | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and                                                                                             
|  
|   | d)                                                                                                                                                                                                                                                                                                 | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|  
|5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|  
|   | a)                                                                                                                                                                                                                                                                                                 | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and                                                                                                       
|  
|   | b)                                                                                                                                                                                                                                                                                                 | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.                                                                                                                                                                                                      
|  



|Date: February 14, 2008By: /s/ Timothy B. MurphyTimothy B. Murphy, President,Treasurer, Chief Financial Officer and Director(principal financial officer)
|---------------------------------------------------------------------------------------------------------------------------------------------------------

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|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------



|Exhibit 32.1CERTIFICATION
|-------------------------

I, Theodore E. Charles, certify that this report on Form 10-Q fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in this report fairly presents, in all material respects, the financial condition and results of operations of Investors Capital Holdings, Ltd.

Date: February 14, 2008

By: /s/ Theodore E. Charles



|Theodore E. Charles, Chairman,Chief Executive Officer and Director(principal executive officer)
|-----------------------------------------------------------------------------------------------

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|Investors Capital Holdings, Ltd. report on form 10-Q
|----------------------------------------------------



|Quarter Ended 12/31/07
|----------------------



|Exhibit 32.2CERTIFICATION
|-------------------------

I, Timothy B. Murphy, certify that this report on Form 10-Q fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in this report fairly presents, in all material respects, the financial condition and results of operations of Investors Capital Holdings, Ltd.

Date: February 14, 2008

By: /s/ Timothy B. Murphy



|Timothy B. Murphy, President,Treasurer, Chief Financial Officer and Director(principal financial officer)
|---------------------------------------------------------------------------------------------------------

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