UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington D.C. 20549


                                 FORM 10-KSB/A-3
                                (Amendment No. 3)


  /X/ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                                   ACT OF 1934


                  For the Fiscal Year Ended: December 31, 2007


     / / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934


                     FOR THE TRANSITION PERIOD FROM __ TO __


                          COMMISSION FILE NO. 000-33129


                     INTERNATIONAL CARD ESTABLISHMENT, INC.
        _________________________________________________________________
        (Exact Name of Small Business Issuer as Specified in its Charter)


           Delaware                                              95-4581903
_______________________________                              ___________________
(State or other jurisdiction of                               (I.R.S. Employer
incorporation or organization)                               Identification No.)


        555 Airport Way, Suite A
          Camarillo, California                                         93010
________________________________________                              __________
(Address of principal executive offices)                              (Zip code)


                    Issuer's telephone number: (866) 423-2491


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

                    common stock, par value $.0005 per share


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

Check if disclosure of delinquent filers pursuant to Item 405 of Regulation S-B
is not contained herein, and will not be contained, to the best of registrant's
knowledge, in definitive proxy or information statements incorporated by
reference in Part II of this Form 10-KSB or any amendments to this Form 10-KSB.
[ ]

State the registrant's revenues for its most recent fiscal year: $9,259,520 as
of December 31, 2007.

State the aggregate market value of the voting and non-voting common equity held
by non-affiliates computed by reference to the price at which the common equity
was sold, or the average bid and asked price of such common equity, as of a
specified date within the past 60 days. $2,358,051 as of March 09, 2008.

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


                                       1


<PAGE>


                    APPLICABLE ONLY TO CORPORATE REGISTRANTS

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date. As of March 20, 2008, there were
35,286,449 shares of the registrant's common stock, $.0005 par value,
outstanding.


                       DOCUMENTS INCORPORATED BY REFERENCE

                                      NONE.

Transitional Small Business Disclosure Format (check one): Yes [ ] No [X]


                                EXPLANATORY NOTE

We are filing this Amendment No. 3 on Form 10-KSB/A to our Annual Report on Form
10-KSB for the fiscal year ended December 31, 2007, as originally filed with the
Securities and Exchange Commission (the "Commission") on March 31, 2008 (the
"Original Filing"), as amended on May 7, 2008 (the "First Amendment") and as
further amended on May 18, 2009 (the "Second Amendment") for the purpose of
clarifying the dual dating by the auditors and incorporating the proper language
in information disclosed in Item 8A. The changes in the Statement of Cash Flows
did not affect the Company's net income, earnings per share or overall cash
balance and did not impact the discussion on liquidity in Item 6.


Specific 2007 lines items that are affected by this change:

<TABLE>
<CAPTION>

                                                        AS ORIGINALLY FILED          AMENDED
                                                        FOR THE YEAR ENDED      FOR THE YEAR ENDED
                                                            12/31/2007              12/31/2007         DIFFERENCE
_________________________________________________________________________________________________________________
<S>                                                         <C>                     <C>                   <C>

Cash Flows From
OPERATING ACTIVITIES
Inventories                                                    (37,919)                663,012           700,931

      NET CASH PROVIDED BY OPERATING ACTIVITIES                657,731               1,358,662           700,931

FINANCING ACTIVITIES
Proceeds from line of credit, related party                    754,396                 626,000          (128,396)
Noncash advances from line of credit, related party            739,565                  83,653          (655,912)
Payment on line of credit, related party                    (1,398,008)             (1,314,631)           83,377

      NET CASH (USED IN) FINANCING ACTIVITIES                 (448,520)             (1,149,451)         (700,931)


Specific 2006 lines items that are affected by this change:

                                                        AS ORIGINALLY FILED          AMENDED
                                                        FOR THE YEAR ENDED      FOR THE YEAR ENDED
                                                            12/31/2006              12/31/2006         DIFFERENCE
_________________________________________________________________________________________________________________

Cash Flows From
OPERATING ACTIVITIES
Inventories                                                    (21,025)                383,753          (404,778)

      NET CASH (USED IN) OPERATING ACTIVITIES                 (547,040)               (142,262)         (404,778)


FINANCING ACTIVITIES
Proceeds from line of credit, related party                    447,600                 444,000             3,600
Noncash advances from line of credit, related party            533,221                  29,441           503,780
Payment on line of credit, related party                      (470,192)               (367,590)         (102,602)

      NET CASH (USED IN) FINANCING ACTIVITIES                 (211,516)               (616,294)          404,778

</TABLE>

                                      2


<PAGE>



This Amendment No. 3 does not change any of the information contained in the
Original Filing, the First Amendment or the Second Amendment, except as
discussed in this Explanatory Note. This Amendment No. 3 continues to speak as
of the date of the Original Filing and we have not updated or amended the
disclosures contained therein to reflect events that have occurred since the
date of the Original Filing. Accordingly, this Amendment No. 3 should be read in
conjunction with our filings made with the Commission subsequent to the date of
the Original Filing.





























                                       3


<PAGE>


ITEM 7. FINANCIAL STATEMENTS.


            INTERNATIONAL CARD ESTABLISHMENT, INC. AND SUBSIDIARIES

                       CONSOLIDATED FINANCIAL STATEMENTS


                               DECEMBER 31, 2007
                               DECEMBER 31, 2006



























                                       4


<PAGE>


            INTERNATIONAL CARD ESTABLISHMENT, INC. AND SUBSIDIARIES


                                    CONTENTS

                                                                            Page

REPORT OF THE INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM ON THE
CONSOLIDATED FINANCIAL STATEMENTS                                            24
________________________________________________________________________________

CONSOLIDATED FINANCIAL STATEMENTS

   Consolidated Balance Sheets                                               25

   Consolidated Statements of Operations                                     26

   Consolidated Statements of Stockholders' Equity                           28

   Consolidated Statements of Cash Flows                                     29

   Notes to Consolidated Financial Statements                                31

________________________________________________________________________________













                                       23


<PAGE>


             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


To the Board of Directors and Stockholders' of International Card Establishment,
Inc. and Subsidiaries

We have audited the accompanying consolidated balance sheets of International
Card Establishment, Inc. (a Delaware corporation) as of December 31, 2007 and
2006, and the related consolidated statements of operations, stockholders'
equity, and cash flows for each of the years then ended. These consolidated
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.

We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the
consolidated financial statements are free of material misstatement. The Company
is not required to have, nor were we engaged to perform, an audit of its
internal control over financial reporting. Our audits included consideration of
internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances but not for the purpose of
expressing an opinion on the effectiveness of the Company's internal control
over financial reporting. Accordingly, we express no such opinion. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the consolidated financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall consolidated financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of International Card
Establishment, Inc. as of December 31, 2007 and 2006, and the results of its
operations and its cash flows for each of the years then ended in conformity
with accounting principles generally accepted in the United States of America.

MENDOZA BERGER & COMPANY, LLP




Irvine, California
March 24, 2008, Except for the Restated Statement of Cash Flows, which is dated
May 19, 2009


                                       24


<PAGE>

<TABLE>
<CAPTION>

             INTERNATIONAL CARD ESTABLISHMENT, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS

                                                                                  December 31,     December 31,
                                                                                          2007             2006
                                                                                  ____________     ____________
<S>                                                                               <C>              <C>
                                     ASSETS
CURRENT ASSETS
     Cash                                                                         $    126,149     $    157,528
     Accounts receivable, trade, net of allowance of $225,425 and $280,595
        as of December 31, 2007 and 2006, respectively                                  27,059           87,705
     Inventory                                                                         109,628           71,709
     Other receivables                                                                 268,779          372,995
     Notes receivable, net of allowance of $50,000 and $0 as
of
        December 31, 2007 and 2006, respectively                                         6,428           15,154
                                                                                  ____________     ____________
            Total current assets                                                       538,043          705,091
                                                                                  ____________     ____________

FIXED ASSETS, net of accumulated depreciation of $2,983,007 and $2,222,776
     as of December 31, 2007 and 2006, respectively                                      6,320          859,551
INTANGIBLE ASSETS                                                                    1,820,300        5,270,141
GOODWILL                                                                                87,978           87,978
OTHER NON-CURRENT ASSETS                                                               117,700          117,818
                                                                                  ____________     ____________

                   Total assets                                                   $  2,570,341     $  7,040,579
                                                                                  ============     ============

                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
     Accounts payable                                                             $    106,394     $    256,908
     Accrued expenses                                                                  512,981          608,428
     Current portion of notes payable                                                   42,613          104,473
     Current portion of notes payable, related parties                                 400,000          480,000
     Line of credit, related parties                                                   606,582          510,629
     Current portion of capital lease                                                        -           19,775
                                                                                  ____________     ____________

            Total current liabilities                                                1,668,570        1,980,213

NOTES PAYABLE, RELATED PARTY                                                                 -          360,000
NOTES PAYABLE, LONG TERM                                                                     -           42,613
LONG-TERM PORTION OF CAPITAL LEASE                                                           -           63,849
                                                                                  ____________     ____________

                   Total liabilities                                                 1,668,570        2,446,675

COMMITMENTS & CONTINGENCIES                                                                  -                -
STOCKHOLDERS' EQUITY
     Preferred stock: $.01 par value; authorized 10,000,000 shares;
        issued and outstanding: 54,000 and 58,500 shares at
        December 31, 2007 and 2006, respectively                                           540              585
     Common stock: $.0005 par value; authorized 100,000,000 shares;
        issued and outstanding: 35,286,449 and 33,951,698 shares
        at December 31, 2007 and 2006, respectively                                     17,643           16,976
     Common stock subscribed                                                           100,064          100,064
     Additional paid-in capital                                                     19,544,354       19,281,810
     Accumulated deficit                                                           (18,760,830)     (14,805,531)
                                                                                  ____________     ____________
            Total stockholders' equity                                                 901,771        4,593,904
                                                                                  ____________     ____________
                   Total liabilities and
                   stockholders' equity                                           $ 2 ,570,341     $  7,040,579
                                                                                  ============     ============


See Accompanying Notes to Consolidated Financial Statements.

</TABLE>

                                       25
<PAGE>

<TABLE>
<CAPTION>

             INTERNATIONAL CARD ESTABLISHMENT, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS

                                                                  Years ended
                                                         December 31,     December 31,
                                                                 2007             2006
                                                         ____________     ____________
<S>                                                      <C>              <C>

Revenues:
         Merchant services revenues                      $  8,304,759     $  9,760,028
         Equipment sales                                      954,761        1,162,582
         Less:  sales returns and allowances                  (36,861)        (156,784)
                                                         ____________     ____________
   Net revenue                                              9,222,659       10,765,826

Cost of revenue:
   Commissions                                              1,005,914        1,245,800
   Cost of sales                                            4,720,855        5,346,343
   Cost of sales - equipment                                  288,175          565,260
                                                         ____________     ____________

        Cost of revenue                                     6,014,944        7,157,403
                                                         ____________     ____________

           Gross profit                                     3,207,715        3,608,423
                                                         ____________     ____________

Operating, general, and administrative expenses:
   General, administrative and selling expenses             2,540,923        5,286,889
   Restructuring charges                                            -          207,335
   Depreciation                                               781,931        1,021,246
   Impairment of merchant portfolios                        3,649,711                -
                                                         ____________     ____________
           Total operating, general, and
           administrative expenses                          6,972,565        6,515,470
                                                         ____________     ____________


           Net operating loss                              (3,764,850)      (2,907,047)

Non-operating income (expense):
   Interest income                                                559              644
   Interest expense                                          (130,858)        (131,855)
   Legal settlement                                            (8,451)               -
   Loss on lease settlement                                   (51,699)               -
                                                         ____________     ____________

           Total non-operating(loss)                         (190,449)        (131,191)
                                                         ____________     ____________

   Net loss before discontinued operations                 (3,955,299)      (3,038,238)

Discontinued operations:
   Loss from operations of discontinued segment
    (including loss on disposal of $543,069)                        -         (516,993)
                                                         ____________     ____________

   Net loss before preferred dividends                     (3,955,299)      (3,555,231)

   Dividends paid on preferred shares                               -          199,844
                                                         ____________     ____________

   Net loss allocable to common shareholders             $ (3,955,299)    $ (3,755,075)
                                                         ============     ============


                                       26


<PAGE>


             INTERNATIONAL CARD ESTABLISHMENT, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (CONTINUED)


                                                                  Years ended
                                                         December 31,     December 31,
                                                                 2007             2006
                                                         ____________     ____________

   Earnings per share from continuing operations         $      (0.11)    $      (0.10)
                                                         ============     ============
   Earnings per share from discontinued operations       $          -     $      (0.02)
                                                         ============     ============
   Earnings per share                                    $      (0.11)    $      (0.12)
                                                         ============     ============
   Average number of shares
   of common stock outstanding-Basic and Diluted           34,748,752       30,916,668
                                                         ============     ============

   Dividends Per Share                                   $          -     $       3.42
                                                         ============     ============

See Accompanying Notes to Consolidated Financial Statements.

</TABLE>













                                       27


<PAGE>

<TABLE>
<CAPTION>


                                           INTERNATIONAL CARD ESTABLISHMENT, INC. AND SUBSIDIARIES
                                               CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY


                                                                                      Common or
                                Preferred Stock       Common Stock       Additional   Preferred
                                _______________   ____________________     Paid-In      Stock        Accumulated
                                Shares   Amount     Shares     Amount     Capital     Subscribed        Deficit       Total
                                ______   ______   __________   _______   ___________  __________    ____________   ___________
<S>                             <C>      <C>      <C>          <C>       <C>          <C>           <C>            <C>

Balance, December 31,
   2005                         62,000   $  620   29,337,392   $14,669   $17,987,902  $        -    $(11,050,456)  $ 6,952,735

Common stock subscribed                                                                  100,064                       100,064
Preferred stock dividend                                                                                (199,844)     (199,844)
Preferred stock dividend
   paid via common stock                           1,450,973       725       233,347                                   234,072
Legal settlement                                      80,000        40        21,560                                    21,600
Common stock sold at
   $0.10 per share                                 2,150,000     1,075       213,925                                   215,000
Stock based compensation                                                     825,508                                   825,508
Conversion of preferred
   shares to common shares      (3,500)     (35)     933,333       467          (432)                                        -
Net loss, December 31, 2006                                                                           (3,555,231)   (3,555,231)
                                ______   ______   __________   _______   ___________  __________    ____________   ___________
Balance, December 31,
    2006                        58,500      585   33,951,698    16,976    19,281,810     100,064     (14,805,531)    4,593,904
                                ______   ______   __________   _______   ___________  __________    ____________   ___________

Stock based compensation                                                     240,124                                   240,124
Conversion of preferred
   Shares to common shares      (4,500)     (45)   1,200,000       600          (555)                                        -
Anti-dilution clause of 2003
    common stock financing                           134,751        67        22,975                                    23,042
Net Loss, December 31, 2007                                                                           (3,955,299)   (3,955,299)
                                ______   ______   __________   _______   ___________  __________    ____________   ___________
Balance, December 31,
    2007                        54,000   $  540   35,286,449   $17,643   $19,544,354  $  100,064    $(18,760,830)  $   901,771
                                ======   ======   ==========   =======   ===========  ==========     ===========   ===========


See Accompanying Notes to Consolidated Financial Statements.

</TABLE>


                                       28

<PAGE>

<TABLE>
<CAPTION>

             INTERNATIONAL CARD ESTABLISHMENT, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                                 Years ended
                                                        December 31,     December 31,
                                                                2007             2006
                                                        ____________     ____________
<S>                                                      <C>              <C>

Cash Flows From
Operating Activities:

    Net loss                                             $(3,955,299)     $(3,555,231)
    Loss on disposal                                               -          543,069
    Restructuring charges                                          -          207,335
    Loss on lease settlement                                  51,699                -
    Depreciation                                             781,931        1,021,246
    Allowance for doubtful accounts                           (5,169)         248,864
    Common stock subscribed for salaries                           -           43,064
    Stock issued for consulting fees                               -           21,600
    Stock issued for anti-dilution clause                     23,042                -
    Stock award compensation                                 240,124          825,508
    Impairment of merchant portfolios                      3,649,711                -
    Other non-cash items, net                                      -           30,269
    Non-cash items due to
       discontinued operations                                     -           26,623
    Adjustments to reconcile net loss to cash
         used in operating activities:
    Changes in assets and liabilities
      Decrease in accounts receivable                        115,816          158,500
      Increase in inventory                                  663,012          383,753
      Increase in other receivables                          104,215         (259,348)
      Decrease in prepaid expenses                                 -          343,848
      (Increase)decrease in other non-current assets            (435)           5,810
      Decrease in accounts payable                          (214,536)        (120,378)
      Decrease in accrued expenses                           (95,449)         (66,793)
                                                         ___________      ___________
        Net cash provided by (used in)
          operating activities                             1,358,662         (142,262)
                                                         ___________      ___________

Cash Flows From Investing Activities:
    Acquisitions, net of attrition                          (199,871)        (483,089)
    Purchase of equipment                                          -          (35,310)
    Proceeds from the sale of discontinued segment                 -          701,443
    Issuance of notes receivable                             (50,000)         (15,000)
    Payments received toward notes receivable                  9,281                -
                                                         ___________      ___________

        Net cash (used in) provided
          by investing activities                           (240,590)         168,044
                                                         ___________      ___________


                                       29


<PAGE>


             INTERNATIONAL CARD ESTABLISHMENT, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (CONTINUED)

                                                                 Years ended
                                                        December 31,     December 31,
                                                                2007             2006
                                                        ____________     ____________
Cash Flows From Financing Activities:
    Related party notes payable, net                               -          (76,333)
    Proceeds from notes payable                               70,000                -
    Proceeds from line of credit, related party              626,000          444,000
    Non-cash advancements from line of
       credit, related party                                  83,653           29,441
    Payments on capital lease                                      -           (9,376)
    Payments on notes payable, related party                (440,000)        (200,000)
    Payments on notes payable                               (174,473)        (651,436)
    Payments on line of credit, related party             (1,314,631)        (367,590)
    Proceeds from sale of common stock                             -          215,000
                                                         ___________      ___________
         Net cash (used in) provided by
            financing activities                          (1,149,451)        (616,294)
                                                         ___________      ___________

         Net decrease in cash                                (31,379)        (590,512)

Cash, beginning of period                                    157,528          748,040
                                                         ___________      ___________

Cash, end of period                                      $   126,149      $   157,528
                                                         ===========      ===========

Supplemental Cash Flow Disclosures:
 Cash paid for interest                                  $    91,936      $   113,526

 Cash paid for income taxes                              $         -      $         -

 Non-cash financing and investing activities:

  Notes payable reclassified from accounts payable       $         -      $   291,589

  Capital lease, accounting software                     $         -      $    93,000

  Merchant portfolios purchased through common
   stock subscription                                    $         -      $    57,000

  Merchant portfolios purchased through related-
   party notes payable                                   $         -      $ 1,040,000

  Payment of accrued preferred stock dividend with
    common stock; accrual December 2005 -
    June 2006                                            $         -      $   234,073

  Abandonment of fixtures due to relocation              $         -      $     5,131

  Preferred share dividends paid via common stock        $         -      $   199,844

  Preferred share conversions to common stock -
    see Shareholder's Equity                             $         -      $         -

   Increase in inventory due to direct payment from
      the related party line of credit                   $   700,931      $   404,778

   Reclassification of capital lease to accounts payable
      due to settlement agreement                        $    64,023      $         -

</TABLE>


                                       30


<PAGE>


             INTERNATIONAL CARD ESTABLISHMENT, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION AND ORGANIZATION

International Card Establishment, Inc. (the "Company"), a Nevada corporation, is
a provider of diversified products and services to the electronic transaction
processing industry, offering merchant accounts for the acceptance and
processing of credit and debit cards, as well as a proprietary "smart card"
based gift and loyalty program. The Company's Merchant Card Services division
establishes "merchant accounts" for businesses that enable those businesses to
accept credit cards, debit cards, and other forms of electronic payments from
their customers; supplies the necessary card readers and other point-of-sale
transaction systems; facilitates processing for the accounts; and, provides
e-commerce solutions. Through its NEOS Subsidiary the Company also markets a
proprietary "Smart Card"-based system that enables merchants to economically
offer store-branded gift and loyalty cards - one of the fastest growing product
categories in the industry.

As used in these Notes to the Consolidated Financial Statements, the terms the
"Company", "we", "us", "our" and similar terms refer to International Card
Establishment, Inc. and, unless the context indicates otherwise its consolidated
subsidiaries. The Company's subsidiaries include NEOS Merchant Services
("NEOS"), a Nevada corporation, which provides smart card loyalty programs in an
integrated vertical system for its customers, as well as other electronic
payment services (merchant services); International Card Establishment ("ICE"),
which provides electronic payment services (merchant services); and INetEvents,
Inc. ("INET"), a Delaware Corporation, which has been dormant since 2005.

The Company's subsidiary, GlobalTech Leasing ("GLT"), a California corporation,
which provides lease funding for equipment supplied by the Company to its
customers, as well as numerous other unrelated merchant service providers, was
sold in 2006. GTL comprised the Company's entire Leasing Services segment of the
Company.

The consolidated financial statements include the accounts of the Company and
its subsidiaries. All significant intercompany transactions and accounts have
been eliminated in consolidation.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

ESTIMATES

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

CASH

For the Statements of Cash Flows, all highly liquid investments with maturity of
three months or less are considered to be cash equivalents. There were no cash
equivalents as of December 31, 2007 and 2006.

CONCENTRATIONS

The Company maintains cash balances at several highly-rated financial
institutions in California. Accounts at each institution are insured by the
Federal Deposit Insurance Corporation ("FDIC") up to $100,000. At December 31,
2007 and 2006 the Company had one account in excess of the $100,000 insured
amount.

Due to the number of customers that we process credit card transactions for we
are not dependant on a limited number of customers for the generation of
revenues.

ALLOWANCE FOR DOUBTFUL ACCOUNTS

The Company estimates its accounts receivable risks and provides allowances for
doubtful accounts accordingly. The Company believes that its credit risk for
accounts receivable is limited because of its large number of customers and the
relatively small account balances for most of its customers. Also, the Company's
customers are dispersed across different business and geographic areas. The
Company evaluates the adequacy of the allowance for doubtful accounts on a
periodic basis. The evaluation includes historical loss experience, length of
time receivables are past due, adverse situations that may affect a customer's
ability to repay and prevailing economic conditions. The Company makes
adjustments to its allowance for doubtful accounts if the evaluation of
allowance requirements differs from the actual aggregate reserve. This
evaluation is inherently subjective and estimates may be revised as more
information becomes available.


                                       31


<PAGE>


INVENTORY

Inventories are stated at the lower of cost or market. Cost is determined using
the first in, first out method. The Company's inventories consist primarily of
electronic merchant processing machines, gift and loyalty cards, and their
corresponding printing supplies.

FIXED ASSETS

Furniture, fixtures and equipment are stated at cost less accumulated
depreciation and amortization. Depreciation and amortization are provided for in
amounts sufficient to relate the cost of depreciable assets to operations over
their estimated service lives, principally on a straight-line basis. Leased
assets qualifying for capital lease treatment have been included in Fixed Assets
and related Accumulated Depreciation accounts in these financial statements.
Leased assets consist of laptops, which are depreciated in accordance with the
Company's policy.

Estimated service lives of property and equipment are as follows:

                    Furniture and fixtures    3 years
                    Equipment and machinery   3 - 5 years
                    Software                  5 years

INCOME TAXES

Income taxes are provided for using the liability method of accounting in
accordance with SFAS No. 109 "Accounting for Income Taxes," and clarified by FIN
48, "Accounting for Uncertainty in Income Taxes--an interpretation of FASB
Statement No. 109." A deferred tax asset or liability is recorded for all
temporary differences between financial and tax reporting. Temporary differences
are the differences between the reported amounts of assets and liabilities and
their tax basis. Deferred tax assets are reduced by a valuation allowance when,
in the opinion of management, it is more likely than not that some portion or
all of the deferred tax assets will not be realized. Deferred tax assets and
liabilities are adjusted for the effect of changes in tax laws and rates on the
date of enactment.

During the year ended December 31, 2007, the Company adopted Financial
Accounting Standards Board (FASB) Interpretation No. 48, "Accounting for
Uncertainty in Income Taxes" (FIN 48), which supplements SFAS No. 109,
"Accounting for Income Taxes," by defining the confidence level that a tax
position must meet in order to be recognized in the financial statements. The
Interpretation requires that the tax effects of a position be recognized only if
it is "more-likely-than-not" to be sustained based solely on its technical
merits as of the reporting date. The more-likely-than-not threshold represents a
positive assertion by management that a company is entitled to the economic
benefits of a tax position, If a tax position is not considered
more-likely-than-not to be sustained based solely on its technical merits. No
benefits of the tax position are to be recognized. Moreover, the
more-likely-than-not threshold must continue to be met in each reporting period
to support continued recognition of a benefit. With the adoption of FIN 48,
companies are required to adjust their financial statements to reflect only
those tax positions that are more-likely-than-not to be sustained. Any necessary
adjustment would be recorded directly to retained earnings and reported as a
change in accounting principle.

FAIR VALUE

The carrying amounts reflected in the consolidated balance sheets for cash,
accounts receivables, net, accounts payable, and accrued expenses approximate
the respective fair values due to the short maturities of these items. The
Company does not hold any investments that are available-for-sale.

GOODWILL AND INTANGIBLES

Goodwill represents the excess of purchase price over tangible and other
intangible assets acquired less liabilities assumed arising from business
acquisitions. In 2007 and 2006, the Company's annual goodwill impairment test
did not identify an impairment of goodwill.

The Company capitalizes intangible assets such as the purchase of merchant and
gift loyalty accounts from portfolio acquisitions (i.e. the right to receive
future cash flows related to transactions of these applicable merchants) (See
Note 5). At least annually, the Company performs a census of merchant accounts
received in such acquisitions, analyzing the expected cash flows, and adjusts
the intangible asset accordingly. In 2006, the Company purchased merchant and
gift card portfolios in the amount of $1,825,177 and $25,720 respectively, that
were not related to a business combination or acquisition; at December 31, 2006
the Company recognized direct write offs of $229,228. At December 31, 2007, the
Company recognized an impairment of $3,649,711 in merchant and gift card
portfolios by writing them down to their appraised value.

DERIVATIVES

The Company occasionally issues financial instruments that contain an embedded
instrument. At inception, the Company assesses whether the economic
characteristics of the embedded derivative instrument are clearly and closely
related to the economic characteristics of the financial instrument (host
contract), whether the financial instrument that embodies both the embedded


                                       32


<PAGE>


derivative instrument and the host contract is currently measured at fair value
with changes in fair value reported in earnings, and whether a separate
instrument with the same terms as the embedded instrument would meet the
definition of a derivative instrument.

If the embedded derivative instrument is determined not to be clearly and
closely related to the host contract, is not currently measured at fair value
with changes in fair value reported in earnings, and the embedded derivative
instrument would qualify as a derivative instrument, the embedded derivative
instrument is recorded apart from the host contract and carried at fair value
with changes recorded in current-period earnings. As of December 31, 2007 and
2006 we determined that none of our embedded financial instruments qualified for
this treatment and that the embedded instruments qualified for the derivative
accounting exemption as they are both indexed to our stock and classified in the
stockholders' equity section of our consolidated balance sheets. We have
accounted for any calculated beneficial conversion feature as either interest
expense or dividends paid, based on the nature of the host contract.

REVENUES

The Company provides merchant services, customer support for merchants and other
Merchant Services providers, and sells merchant point-of-sale and credit card
processing equipment. Revenue is recognized as customer services are provided.

The Company provides merchant services to customers for the acceptance and
processing of electronic payments. Credit card processing fees are recognized as
incurred. Sales and cost of sales of equipment are recognized when the equipment
is provided and the customer accepts responsibility for the payment of the
equipment.

ADVERTISING

Advertising costs are charged to operations as incurred. Advertising costs for
the years ended December 31, 2007 and 2006 were $58,187 and $551, respectively.

RECLASSIFICATION

Certain reclassifications, which have no effect on net loss, have been made in
the prior period financial statements to conform to the current presentation.

RESTATEMENT

RESTATEMENT We have restated our Statement of Cash Flows for the Years Ended
December 31, 2007 and 2006. During both of these periods, our related party line
of credit extended credit to us in three forms: 1) cash proceeds, 2) direct
payment of inventory items and 3) direct payment of expendable items (e.g.
office supplies). Upon further review of the transactions in this account, we
have restated our numbers in association with these transactions, and the cash
payments toward the line of credit. Overall net income and total cash did not
change, nor did this restatement affect our earnings per share.

Specific 2007 lines items that are affected by this change:



<TABLE>
<CAPTION>

                                                        AS ORIGINALLY FILED          AMENDED
                                                        FOR THE YEAR ENDED      FOR THE YEAR ENDED
                                                            12/31/2007              12/31/2007         DIFFERENCE
_________________________________________________________________________________________________________________
<S>                                                         <C>                     <C>                   <C>

Cash Flows From
OPERATING ACTIVITIES
Inventories                                                    (37,919)                663,012           700,931
                                                            ____________________________________________________

      NET CASH PROVIDED BY OPERATING ACTIVITIES                657,731               1,358,662           700,931

FINANCING ACTIVITIES
Proceeds from line of credit, related party                    754,396                 626,000          (128,396)
Noncash advances from line of credit, related party            739,565                  83,653          (655,912)
Payment on line of credit, related party                    (1,398,008)             (1,314,631)           83,377
                                                            ____________________________________________________

      NET CASH (USED IN) FINANCING ACTIVITIES                 (448,520)             (1,149,451)         (700,931)

</TABLE>

                                       33


<PAGE>


Specific 2006 lines items that are affected by this change:

<TABLE>
<CAPTION>

                                                        AS ORIGINALLY FILED          AMENDED
                                                        FOR THE YEAR ENDED      FOR THE YEAR ENDED
                                                            12/31/2006              12/31/2006         DIFFERENCE
_________________________________________________________________________________________________________________
<S>                                                         <C>                     <C>                   <C>

Cash Flows From
OPERATING ACTIVITIES
Inventories                                                    (21,025)                383,753          (404,778)
                                                            ____________________________________________________

      NET CASH (USED IN) OPERATING ACTIVITIES                 (547,040)               (142,262)         (404,778)

FINANCING ACTIVITIES
Proceeds from line of credit, related party                    447,600                 444,000             3,600
Noncash advances from line of credit, related party            533,221                  29,441           503,780
Payment on line of credit, related party                      (470,192)               (367,590)         (102,602)
                                                            ____________________________________________________

      NET CASH (USED IN) FINANCING ACTIVITIES                 (211,516)               (616,294)          404,778

</TABLE>


NEW ACCOUNTING PRONOUNCEMENTS

In September 2006, the FASB issued SFAS No. 157, "Fair Value Measurements" (SFAS
157). SFAS 157 provides guidance for using fair value to measure assets and
liabilities. SFAS 157 addresses the requests from investors for expanded
disclosure 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 157 applies whenever other standards
require (or permit) assets or liabilities to be measured at fair value, and does
not expand the use of fair value in any new circumstances. SFAS 157 is effective
for financial statements issued for fiscal years beginning after November 15,
2007 and will be adopted by the Company in the first quarter of fiscal year
2008. We do not expect that the adoption of SFAS 157 will have a material impact
on our financial condition or results of operations.

In December 2007, the FASB issued SFAS No. 160, "NONCONTROLLING INTERESTS IN
CONSOLIDATED FINANCIAL STATEMENTS--AN AMENDMENT OF ARB NO. 51" ("SFAS No. 160").
SFAS 160 requires companies with noncontrolling interests to disclose such
interests clearly as a portion of equity but separate from the parent's equity.
The noncontrolling interest's portion of net income must also be clearly
presented on the Income Statement. SFAS 160 is effective for financial
statements issued for fiscals years beginning after December 15, 2008 and will
be adopted by the Company in the first quarter of fiscal year 2009. We do not
expect that the adoption of SFAS 160 will have a material impact on our
financial condition or results of operation.

In December 2007, the FASB issued SFAS No. 141 (R), "BUSINESS COMBINATIONS
(REVISED 2007)" ("SFAS No. 141 (R)"). SFAS 141 (R) applies the acquisition
method of accounting for business combinations established in SFAS 141 to all
acquisitions where the acquirer gains a controlling interest, regardless of
whether consideration was exchanged. Consistent with SFAS 141, SFAS 141 (R)
requires the acquirer to fair value the assets and liabilities of the acquiree
and record goodwill on bargain purchases, with main difference the application
to all acquisitions where control is achieved. SFAS 141 (R) is effective for
financial statements issued for fiscal years beginning after December 15, 2008
and will be adopted by the Company in the first quarter of fiscal year 2009. We
do not expect that the adoption of SFAS 141 (R) will have a material impact on
our financial condition or results of operation.

NOTE 2. NOTE RECEIVABLE

In April 2007, we issued a note receivable for $50,000 to an independent third
party. This receivable bears no interest and is convertible to a maximum of 10%
of the third party's outstanding common stock in the event of default. Repayment
was expected to begin in October of 2007; however, in September, we have fully
allowed for the entire balance of this note. As of December 31, 2007, we do not
expect to collect any cash from this loan or to convert the debt to common stock
because of the dissolution of all business arrangements with the holder of the
note.


                                       34


<PAGE>


NOTE 3.  DISCONTINUED OPERATIONS

On May 10, 2006, the Company entered in an Agreement and Plan of Merger to sell
its subsidiary GlobalTech Leasing, Inc. ("GTL") to an independent third party
for $2,500,000 consisting of $808,943 in cash and $1,691,057 of debt assumption.
The assets sold consisted primarily of cash, property and equipment. Subsequent
to the disposition of GTL, management determined that approximately $158,000 of
the $2,500,000 was not recoverable from the acquirer, resulting in a total
$701,443 received in cash and $1,640,625 in debt assumption. We have increased
our loss from discontinued operations by this amount in 2006.

GTL comprised the Company's entire Leasing Services segment of the Company.
Leasing income subsequent to the sale totaled $256,384 through December 31,
2006.

The Loss on Discontinued Operations includes $26,076 of earnings in 2006 through
the date of disposal. GTL's sales through May 9, 2006. Loss on the disposal
totaled $543,069.

The resulting income from operations of this discontinued segment, adjusted for
the total loss on the disposal, are pre-tax as the Company has reoccurring net
losses and determined that there would not be a tax effect.

NOTE 4. FIXED ASSETS

Fixed assets and accumulated depreciation consists of the following:

                                                      Years ended
                                             December 31,     December 31,
                                                     2007             2006
                                             ____________    _____________

Furniture and fixtures                       $     14,750    $      14,750
Equipment and machinery                           138,257          231,257
Software                                        2,836,320        2,836,320
                                             ____________    _____________
         Subtotal                               2,989,327        3,082,327
Accumulated Depreciation                       (2,983,007)      (2,222,776)
                                             ____________    _____________
                                             $      6,320    $     859,551
                                             ============    =============

In the second quarter of 2006, the Company entered into a lease agreement for a
new accounting system for $93,000. The lease commenced February 2006 and was
terminated March 31, 2007. We had successfully negotiated a settlement to cancel
this lease. The settlement agreement calls for payments of $10,000 over 7 months
beginning May 31, 2007; all scheduled payments have been made as of December 31,
2007. We have recorded the event as of March 31, 2007 including the resulting
loss of $51,699, representing the carrying value of the asset.


                                       35


<PAGE>


NOTE 5. GOODWILL AND INTANGIBLE ASSETS

Goodwill and Intangible assets were purchased with the acquisition NEOS Merchant
Solutions, Inc. The purchase price allocation at fair market values included
values assigned to intangible assets and a portion allocated to goodwill. The
Company has determined that the intangibles purchased have an indefinite useful
life except as noted below. The provisions of SFAS No. 142, "GOODWILL AND OTHER
INTANGIBLE ASSETS", require the completion of an annual impairment test with any
impairment recognized in current earnings.

The Company commissioned an outside appraisal to determine if any impairment in
intangibles or goodwill for both 2007 and 2006 exists. We have determined that
at present the NEOS tradename has an indefinite life, which has been included in
the Company's annual impairment analysis. In 2007 and 2006, the Company
completed an impairment analysis that resulted in no impairment of goodwill. We
have recognized an impairment of $3,649,711 in our merchant and gift card
portfolios by writing them down to their appraised value.

The Company's intangible assets consisted of the following:

                                         December 31,
                                _____________________________
                                   2007              2006
                                ___________       ___________

Merchant portfolios             $ 1,385,300       $ 4,809,421
Tradename                           435,000           435,000
Gift card portfolios                      -            25,720
                                ___________       ___________
                                $ 1,820,300       $ 5,270,141
                                ===========       ===========

Goodwill                        $    87,978       $    87,978
                                ===========       ===========

Acquisitions, net of attrition, were $199,870 and $483,089, respectively.



                                       36


<PAGE>


NOTE 6. ACCRUED EXPENSES

Accrued expenses consist of the following:

                                         December 31,     December 31,
                                                 2007             2006
                                         ____________     ____________

Accrued payroll                             $ 298,528        $ 249,688
Customer deposits                              40,589           43,215
Accrued expenses, other                       125,189           51,823
Accrued interest                                7,977           18,328
Sales taxes payable                             2,110           23,454
Reserve for chargebacks                        38,588          221,920
                                            _________        _________
                                            $ 512,981        $ 608,428
                                            =========        =========


NOTE 7. NOTES AND LEASES PAYABLE

Notes and leases payable consist of the following:

                                                   December 31,     December 31,
                                                           2007             2006
                                                   ____________     ____________
Notes payable, capital lease obligation
    to acquire computer equipment                  $          -     $      2,202
Notes payable, at 6% interest, due May 2008              42,613          102,271
Lease payable, capital lease obligation
    to acquire accounting system                              -           19,775
                                                   ____________     ____________

Current portion of notes and leases payable        $     42,613     $    124,248
                                                   ============     ============

Notes payable, at 6% interest, due May 2008        $          -     $     42,613
Lease payable, capital lease obligation
    to acquire accounting system                                          63,849
                                                   ____________     ____________

Noncurrent portion of notes and leases payable     $          -     $    106,462
                                                   ============     ============

As previously disclosed, in the second quarter of 2006, the Company entered into
a lease agreement for a new accounting system for $93,000. The lease commenced
February 2006 and was terminated March 31, 2007. We had successfully negotiated
a settlement to cancel this lease. The settlement agreement calls for payments
of $10,000 over 7 months beginning May 31, 2007; all scheduled payments have
been made as of December 31, 2007. We have recorded the event as of March 31,
2007 including the resulting loss of $51,699, representing the carrying value of
the asset.

The Company is required to make the following principal payments on its total
debt (including related party debt see Note 12):

     Year Ended December 31,           Principal Payments
                                       __________________

     2008                                    1,047,890
     2009                                            -
     2010                                            -
     2011                                            -
     Thereafter                                      -
                                          ____________
     Total                                $  1,047,890
                                          ============


                                       37


<PAGE>


NOTE 8. RESTRUCTURING CHARGES

Due to the Company's continued losses, we critically reviewed all locations and
closed non-profitable locations where appropriate in 2006. Due to this we have
reported a Restructuring Charge in our in Statement of Operations of $207,335
for the year ending December 31, 2006.

The Company consolidated locations and moved the majority of operations to its
Camarillo location, which was completed in the third quarter of 2006.

All items identifiable for this restructuring at December 31, 2006 have been
expensed and consist of:

Payroll and benefits                                 $  80,031
Office closure and early lease termination              85,156
Transitional staff housing and other                    42,148
                                                     _________
Total                                                $ 207,335
                                                     =========

NOTE 9. STOCKHOLDERS' EQUITY

The authorized common stock of the Company consists of 100,000,000 shares of
common shares with par value of $0.0005 and 10,000,000 shares of preferred stock
with a par value of $0.01.

In 2006, the Company has the following common stock transactions:

     o    Issued $100,064 of common stock subscriptions, $43,064 were for
          accrued salaries.

     o    Issued 1,450,973 of common stock for preferred share dividends
          amounting to $234,072.

     o    Issued 80,000 of common stock relating to a legal settlement amounting
          to $21,600.

     o    Issued 2,150,000 of common stock for a cash offering; shares sold at
          $0.10 a share for a total of $215,000.

We did not issue or authorize for issuance any shares in the first quarter of
2007. The only activity in our equity section relates to the expensing of stock
options granted as of December 31, 2006, amounting to $240,124.

In 2007, the Company has the following common stock transactions:

     o    Issued 1,200,000 shares for the conversion of 4,500 preferred shares.

     o    Issued 134,751 shares per a 2003 agreement's antidilution clause for a
          value of $23,042.

As of December 31, 2007, we have instructed our SEC counsel to finalize all
necessary paperwork for the issuance of shares comprising the remaining $100,064
in our common stock subscription.

PREFERRED STOCK

Collectively, the Series A Convertible Preferred Stock contain the following
features:

o    Dividends: Each share of Series A Preferred Stock pays a mandatory monthly
     dividend, at an annual rate equal to the product of multiplying (i) $100.00
     per share, by (ii) six and one-half percent (6.5%). Dividends are payable
     monthly in arrears on the last day of each month, in cash, and prorated for
     any partial month periods. From and after the Effective Date of the
     Registration Statement, no further MANDATORY DIVIDENDS shall be payable on
     the Series A Preferred Stock. There have been no preferred stock dividends
     declared or paid since that date.

o    Liquidation Preferences: Series A Preferred Stock is entitled to be paid
     first out of the assets of the Corporation available for distribution to
     shareholders, whether such assets are capital, surplus or earnings, an
     amount equal to the Series A Purchase Price per share of Series A Preferred
     Stock held (as adjusted for any stock splits, stock dividends or
     recapitalizations of the Series A Preferred Stock) and any declared but
     unpaid dividends on such share, before any payment is made to the holders
     of the common stock, or any other stock of the Corporation ranking junior
     to the Series A Preferred Stock with regard to any distribution of assets
     upon liquidation, dissolution or winding up of the Corporation.


                                       38


<PAGE>


o    Voting Rights: None

o    Conversion Rights: Series A Preferred Stock may, at the option of the
     holder, be converted at any time or from time to time into fully paid and
     non-assessable shares of common stock at the conversion rate in effect at
     the time of conversion, provided, that a holder of Series A Preferred Stock
     at any given time convert only up to that number of shares of Series A
     Preferred Stock so that, upon conversion, the aggregate beneficial
     ownership of the Corporation's common stock is not more than 9.99% of the
     Corporation's common stock then outstanding. The "Conversion Price" per
     share for the Series A Preferred Stock shall be equal to Eighty-Five
     percent (85%) of the Market Price, rounded to the nearest penny; in no
     event shall the Conversion Price be less than $0.375 per share (the "Floor
     Price") or exceed $0.47 (the "Ceiling Price").

o    Reservation of Stock Issuable Upon Conversion: The Corporation shall at all
     times reserve and keep available out of its authorized but unissued shares
     of common stock, solely for the purpose of effecting the conversion of the
     shares of the Series A Preferred Stock 15,000,000 shares of common stock.

As disclosed above in Note 6, the Company accrued for Preferred Stock Dividends
$ 0 as of December 31, 2007 and 2006, respectively. In the second quarter of
2006, the Company amended the preferred share agreements above with the
shareholders to remove the dividend reference. Consideration for all dividends
accrued as of June 22, 2006 were paid via issued of 1,450,973 in the Company's
common stock. Total dividends accrued and paid (cash and stock issuance),
inclusive of the beneficial conversion accounted for as preferred dividends,
totaled $0 and $199,844 as of December 31, 2007 and 2006, respectively.

The Company has converted 4,500 and 3,500 shares of preferred stock to 1,200,000
and 933,333 shares of common stock in 2007 and 2006, respectively.

NET LOSS PER COMMON SHARE

Net loss per share is calculated in accordance with SFAS No. 128, "EARNINGS PER
SHARE". The weighted-average number of common shares outstanding during each
period is used to compute basic loss per share. Diluted loss per share is
computed using the weighted averaged number of shares and dilutive potential
common shares outstanding. Potentially dilutive common shares consist of
employee stock options, warrants, and restricted stock, and are excluded from
the diluted earnings per share computation in periods where the Company has
incurred a net loss.

NOTE 10. SHARE OPTION PLAN

The Company's 2003 Stock Option Plan (as amended) for Directors, Executive
Officers, and Employees of and Key Consultants to the Company (the "Plan"),
which is shareholder approved, permits the grant of share options and shares to
its employees for up to 5,000,000 shares of common stock. In addition, in 2007
Company has issued 3,074,000 options under a non-statutory stock option plan.
The Company believes that such awards better align the interests of its
employees and key consultants with those of its shareholders. All option awards
are generally granted with an exercise price equal to market price of the
Company stock at the date of grant, unless otherwise defined in the option
agreement with the grantee.

The fair value of all option awards is estimated on the date of grant using the
Black-Scholes option valuation model that uses the assumptions noted in the
following table. Expected volatilities are based on volatilities from the
Company's traded common stock since the acquisition of INetEvents, Inc. in July
2003. The expected term of options granted is estimated at half of the
contractual term as noted in the individual option agreements and represents the
period of time that options granted are expected to be outstanding. The
risk-free rate for the periods within the contractual life of the option is
based on the U.S. Treasury bond rate in effect at the time of grant for bonds
with maturity dates at the estimated term of the options.

                                           2007            2006

Expected volatility                       212.88%     183.39%-189.44%

Weighted-average volatility                70.96%              45.92%
Expected dividends                             0                   0

Expected term (in years)                       4               2-4.5
Risk-free rate                             4.013%       4.625%-4.875%


                                       39


<PAGE>


A summary of option activity as of December 31, 2007 and 2006, respectively, and
changes during the periods then ended is presented below:

<TABLE>
<CAPTION>
                                                                  Weighted-
                                                   Weighted-       Average
                                                    Average       Remaining      Aggregate
                                                   Exercise      Contractual     Intrinsic
            Options                   Shares         Price          Term           Value
___________________________________________________________________________________________
<S>                                  <C>             <C>             <C>         <C>

Outstanding at December 31, 2005             -       $   -

Granted                              4,370,000       $0.22

Exercised                                    -       $   -

Forfeited or expired                  (125,000)      $0.20)
                                     ______________________________________________________
Outstanding at December 31, 2006     4,245,000       $0.22           2.2         $  835,684

                                     ______________________________________________________
Granted                              3,185,000       $0.15

Exercised                                    -           -

Forfeited or expired                         -           -
                                     ______________________________________________________
Outstanding at December 31, 2007     7,430,000       $0.19           3.5         $1,079,811
                                    =======================================================
Exercisable at December 31, 2007     7,245,000       $0.19           3.5         $1,065,631
                                    =======================================================
</TABLE>

A summary of the status of the Company's nonvested shares as of December 31,
2007 and 2006, and changes during the periods ended December 31, 2007 and 2006,
is presented below:

                                                   Weighted-Average
                                                      Grant-Date
Nonvested Shares                      Shares          Fair Value
___________________________________________________________________

Nonvested at December 31, 2005               -                -
Granted                                 85,000         $ 11,448
Vested                                       -                -
Forfeited                                    -                -
Nonvested at December 31, 2006          85,000           11,448
Granted                              3,100,000          244,127
Vested                              (3,085,000)        (241,395)
Forfeited                                    -                -

Non-vested at December 31, 2007        185,000         $ 14,180
                                    ==========         ========


                                       40


<PAGE>


NOTE 11. INCOME TAXES

The consolidated provision for federal and state income taxes for the years
ended December 31, 2007 and 2006 are as follows:

                                               2007            2006
                                             _________      __________

         Current - State                     $   1,000      $    1,000
         Current - Federal                           -               -
         Deferred - State                     (121,000)       (171,000)
         Deferred - Federal                   (539,000)       (978,000)
         Increase in valuation allowance       659,000       1,148,000

                                             _________      __________
         Income tax expense (benefit)        $       -      $        -
                                             =========      ==========

There were no amounts paid for federal income taxes during the years ended
December 31, 2007 and 2006.

The income tax provision differs from the expense that would result from
applying statutory tax rates to income before taxes because of certain expenses
that are not deductible for tax purposes and the effect of the valuation
allowance.

As of December 31, 2007, the Company had federal net operating loss
carryforwards of $11,763,000 that can be deducted against future taxable income.
These tax carryforward amounts expire as follows:

         December 31, 2022                   $    16,000
         December 31, 2023                       631,000
         December 31, 2024                     3,400,000
         December 31, 2025                     3,926,000
         December 31, 2026                     2,962,000
         December 31, 2027                       828,000
                                             ___________
              Total                          $11,763,000
                                             ===========

However, such carryforwards are not available to offset federal alternative
taxable income. Internal Revenue Code Section 382 imposes limitations on our
ability to utilize net operating losses if we experience an ownership change and
for the NOL's acquired in the acquisitions of subsidiaries. An ownership change
may result from transactions increasing the ownership of 5% or greater
stockholders in the stock of the corporation by more than 50 percentage points
over a three-year period. The value of the stock at the time of an ownership
change is multiplied by the applicable long-term tax exempt interest rate to
calculate the annual limitation. Any unused annual limitation may be carried
over to later years.

The state operating losses will expire between 2012 and 2017 if not utilized.

The Company accounts for income taxes in accordance with Statement of SFAS No.
109 - Accounting for Income Tax and FASB Interpretation No. 48 - Accounting for
Uncertainty in Income Taxes an interpretation of FASB Statement No.109, whereby
deferred taxes are provided on temporary differences arising from assets and
liabilities whose bases are different for financial reporting and income tax
purposes. Deferred taxes are attributable to the effects of the following items:

     o    Differences in calculating depreciation on property, plant and
          equipment

     o    Differences in calculating amortization and/or impairments on
          intangible assets

     o    Allowance for bad debt

     o    Tax loss carryforwards


                                       41


<PAGE>


The Company's total deferred tax assets and deferred tax liabilities at December
31, 2007 and 2006 are as follows:

                                                       2007            2006
                                                    ___________     ___________

     Deferred tax asset - current                   $         -     $         -
     Deferred tax asset - non current                 5,156,000       4,618,000
                                                    ___________     ___________
          Total deferred tax asset                    5,156,000       4,618,000
                                                    ___________     ___________

     Deferred tax liability - current                         -               -
     Deferred tax liability - non current              (262,000)       (384,000)
                                                    ___________     ___________
          Total deferred tax liability                 (262,000)       (384,000)
                                                    ___________     ___________

     Current deferred tax asset (liability)                   -               -
     Non current deferred tax asset (liability)       4,894,000       4,234,000
                                                    ___________     ___________
     Net deferred tax asset (liability)             $ 4,894,000     $ 4,234,000
                                                    ___________     ___________

     Valuation allowance                             (4,894,000)     (4,234,000)
                                                    ___________     ___________

          Net deferred tax asset (liability)        $         -     $         -
                                                    ===========     ===========

SFAS No. 109 - Accounting for Income Tax and FASB Interpretation No. 48 -
Accounting for Uncertainty in Income Taxes an interpretation of FASB Statement
No.109, specify that deferred tax assets are to be reduced by a valuation
allowance if it is more likely than not that some portion or all of the deferred
tax asset will not be realized. The valuation allowance increased $660,000 and
$1,148,000 during the years ended December 31, 2007 and 2006, respectively,
based upon management's expectation of future taxable income. The Company will
continue to assess the valuation allowance and to the extent it is determined
that such allowance is no longer required, the tax benefit of the net deferred
tax asset will be recognized in the future.

Upon adoption of FIN 48 as of January 1, 2007, the Company had no gross
unrecognized tax benefits that, if recognized, would favorably affect the
effective income tax rate in future periods. The Company files income tax
returns in the United States federal jurisdiction and California state
jurisdiction. As of December 31, 2007 the Company has not filed federal or state
of California tax returns, and is working with their tax accountant to rectify
that situation as fast as practical. These U. S. federal and state income tax
returns are considered open tax years as of the date of these consolidated
financial statements. The Company has filed an extension for its 2007 corporate
tax return.

NOTE 12. RELATED PARTY TRANSACTIONS

On September 30, 2006, the Company entered into an agreement for a revolving
line of credit worth $1,000,000 with Worldwide Business Services Group to be
used primarily for working capital. The balance due on the line was $606,582 and
$510,629 as of December 31, 2007 and 2006, respectively. In the third quarter of
2006, the CEO of Worldwide Business Services Group became the Company's General
Manager. Due to this, we have reflected the outstanding line of credit as
related party.

Our Line of Credit with Worldwide Business Services Group matured on July 30,
2007. The Line of Credit was renewed for one year during the third quarter of
2007 and now matures on July 30, 2008.

Related party bonuses paid during the years ended December 31, 2007 and 2006
totaled $6,800 and $179,275, respectively, and are included in general and
administrative expenses.

During the year ended December 31, 2006, the Company also purchased merchant
portfolios from a related party for $1,040,000. Payments of $40,000 are required
for 26 months. This note contains interest of 6% per annum. This is our Notes
Payable, Related Party on our accompanying balance sheet and was $400,000 and
$480,000 as of December 31, 2007 and 2006, respectively. No portfolios from this
source were purchased in 2007.


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<PAGE>


NOTE 13. COMMITMENTS AND CONTINGENCIES

The Company's existing $500,000 line of credit, entered into in December 2005,
was extinguished in July 2006. In July 2006, the Company entered into another
line of credit agreement with the same vendor for $2,000,000. At the time of
extinguishment the Company had not drawn down on the line of credit and no
balance was outstanding. As of December 31, 2007 the Company has not drawn on
the line of credit.

The Company is engaged in various non-cancelable operating leases for office
facilities and equipment. Under the related lease agreements, the Company is
obligated to make monthly payments ranging from $159 to $3,725 with expiration
dates through January 2011.

Minimum future lease obligations for the five years immediately following the
balance sheet date are as follows:



     2008                                           $ 71,242
     2009                                             57,746
     2010                                             11,239
     2011                                              7,210
     Thereafter                                            -
                                                    ________

     Total future minimum lease commitments         $147,438
                                                    ========

In 2005, the Company was engaged in a operating lease for a sales office. Under
the term of the lease agreement, the Company is obligated to make minimum
monthly payments of $2,579 with an expiration date through August 2009. This
lease was terminated in 2006.

The company leases its facilities for a total of $5,877 per month. Our current
offices are located in Camarillo and Mission Viejo, California. Total lease
costs for the years ended December 31, 2007 and 2006 were $86,494 and $70,524,
respectively.

In 2007, ICE was served a subpoena by the receiver for a company seized by the
FTC. The receiver's counsel felt that ICE was not acting quickly enough on the
subpoena so they filed a motion to hold ICE in contempt. A payment of $8,451 was
made in 2007 in full settlement of the claims. This amount represents attorneys'
fees that the receiver incurred in filing that motion. There are no other fees
or costs the receiver is alleging is owed. There are no material legal
proceedings pending or, to our knowledge, threatened against us or any of our
subsidiaries.


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<PAGE>


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

None.

ITEM 8A. CONTROLS AND PROCEDURES.

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

Pursuant to Rule 13a-15(b) under the Securities Exchange Act ("Exchange Act") of
1934, the Company carried out an evaluation with the participation of the
Company's management, including William Lopshire, the Company's Chief Executive
Officer ("CEO") and Candace Mills, the Company's Chief Financial Officer
("CFO"), of the effectiveness of the Company's disclosure controls and
procedures (as defined under Rule 13a-15(e) under the Exchange Act) as of the
year ended December 31, 2007. Based upon that evaluation, the Company's CEO and
CFO concluded that the Company's disclosure controls and procedures are not
effective to ensure that information required to be disclosed by the Company in
the reports that the Company files or submits under the Exchange Act, is
recorded, processed, summarized and reported, within the time periods specified
in the SEC's rules and forms, and that such information is accumulated and
communicated to the Company's management, including the Company's CEO and CFO,
as appropriate, to allow timely decisions regarding required disclosure.

MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

The management of International Card Establishment, Inc. is responsible for
establishing and maintaining adequate internal control over financial reporting.
Internal control over financial reporting is defined in Rule 13a-15(f) or
15d-15(f) promulgated under the Securities Exchange Act of 1934 as a process
designed by, or under the supervision of, the company's principal executive and
principal financial officers and effected by the company's board of directors,
management and other personnel, to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with accounting principles generally
accepted in the United States of America and includes those policies and
procedures that:

     o    Pertain to the maintenance of records that in reasonable detail
          accurately and fairly reflect the transactions and dispositions of the
          assets of the company;

     o    Provide reasonable assurance that transactions are recorded as
          necessary to permit preparation of financial statements in accordance
          with accounting principles generally accepted in the United States of
          America and that receipts and expenditures of the company are being
          made only in accordance with authorizations of management and
          directors of the company; and

     o    Provide reasonable assurance regarding prevention or timely detection
          of unauthorized acquisition, use or disposition of the company's
          assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting
may not prevent or detect misstatements. Projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate. All internal control systems,
no matter how well designed, have inherent limitations. Therefore, even those
systems determined to be effective can provide only reasonable assurance with
respect to financial statement preparation and presentation. Because of the
inherent limitations of internal control, there is a risk that material
misstatements may not be prevented or detected on a timely basis by internal
control over financial reporting. However, these inherent limitations are known
features of the financial reporting process. Therefore, it is possible to design
into the process safeguards to reduce, though not eliminate, this risk.

We conducted an evaluation, with the participation of our Chief Executive
Officer and Chief Financial Officer, of the effectiveness of the design and
operation of our disclosure controls and procedures, as defined in Rules
13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended,
or the Exchange Act, as of December 31, 2007, to ensure that information
required to be disclosed by us in the reports filed or submitted by us under the
Exchange Act is recorded, processed, summarized and reported, within the time
periods specified in the Securities Exchange Commission's rules and forms,
including to ensure that information required to be disclosed by us in the
reports filed or submitted by us under the Exchange Act is accumulated and
communicated to our management, including our principal executive and principal
financial officers, or persons performing similar functions, as appropriate to
allow timely decisions regarding required disclosure. Based on that evaluation,
our Chief Executive Officer and Chief Financial Officer have concluded that as
of December 31, 2007, our disclosure controls and procedures were not effective
at the reasonable assurance level due to the material weaknesses described
below.

In light of the material weaknesses described below, we performed additional
analysis and other post-closing procedures to ensure our financial statements
were prepared in accordance with generally accepted accounting principles.
Accordingly, we believe that the consolidated financial statements included in
this report fairly present, in all material respects, our financial condition,
results of operations and cash flows for the periods presented.

A material weakness is a control deficiency (within the meaning of the Public
Company Accounting Oversight Board (PCAOB) Auditing Standard No. 2) or
combination of control deficiencies, such that there is a reasonable possibility
that a material misstatement of the annual or interim financial statements will
not be prevented or detected. Management has identified the following three
material weaknesses that have caused management to conclude that, as of December
31, 2007, our disclosure controls and procedures were not effective at the
reasonable assurance level:

1.   Our financial reporting process did not entail detail enough for us to
     separate out the major components of our related party line of credit.

To address these material weaknesses, management performed additional analyses
and other procedures to ensure that the financial statements included herein
fairly present, in all material respects, our financial position, results of
operations and cash flows for the periods presented.


Remediation of Material Weaknesses

To remediate the material weaknesses in our disclosure controls and procedures
identified above, we have adjusted our internal financial reporting processes to
ensure that detail is robust enough to identify the major components of our
related party line of credit for proper disclosure in our statement of cash
flows.


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<PAGE>


CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

No changes in the Company's internal control over financial reporting have come
to management's attention during the Company's last fiscal quarter that have
materially affected, or are likely to materially affect, the Company's internal
control over financial reporting.


                                   SIGNATURES


Pursuant to the requirements of Section 13 or 15(d) 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.

Date: October 8, 2009

                                   INTERNATIONAL CARD ESTABLISHMENT, INC.


                                   BY: /s/ WILLIAM LOPSHIRE
                                       __________________________________
                                           WILLIAM LOPSHIRE
                                           CHIEF EXECUTIVE OFFICER
                                           (PRINCIPAL EXECUTIVE OFFICER),
                                           SECRETARY AND DIRECTOR


                                   BY: /s/ CANDACE MILLS
                                       __________________________________
                                           CANDACE MILLS
                                           CHIEF FINANCIAL OFFICER
                                           (PRINCIPAL ACCOUNTING OFFICER)



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



     SIGNATURE                        TITLE                       DATE


/s/ WILLAIM LOPSHIRE      CHIEF EXECUTIVE OFFICER,            October 8, 2009
_____________________     SECRETARY AND DIRECTOR
    WILLAIM LOPSHIRE



/s/ CANDACE MILLS         CHIEF FINANCIAL OFFICER             October 8, 2009
_____________________
    CANDACE MILLS



                                       45