<PAGE>

                     U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2002
OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM ______________ TO
______________

                        COMMISSION FILE NUMBER: 33-68570


                                    eConnect
             (Exact name of registrant as specified in its charter)

                Nevada                                        43-1239043
(State or jurisdiction of incorporation                     I.R.S. Employer
           or organization)                               Identification No.)

2500 Via Cabrillo Marina, Suite 112, San Pedro, California       90731
       (Address of principal executive offices)                (Zip Code)

      Registrant's telephone number:  (310) 514-9482

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act: Common Stock,
$0.001 Par Value; Class A Warrants

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) been
subject to such filing requirements for the past 90 days.  Yes   X      No.

As of July 30, 2002, the Registrant had 41,497,059 shares of common stock
issued and outstanding (1).

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

<PAGE>

                                TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION                                        PAGE

ITEM 1.  FINANCIAL STATEMENTS                                           3

         BALANCE SHEET AS OF JUNE 30, 2002

         STATEMENTS OF OPERATIONS FOR THE THREE MONTHS
         ENDED JUNE 30, 2001

         STATEMENT OF STOCKHOLDERS' DEFICIT FOR THE
         THREE MONTHS ENDED JUNE 30, 2002

         STATEMENTS OF CASH FLOW FOR THE THREE MONTHS
         ENDED JUNE 30, 2001

         NOTES TO FINANCIAL STATEMENTS

ITEM 2.  PLAN OF OPERATION                                              8

PART II - OTHER INFORMATION                                            11

ITEM 1.  LEGAL PROCEEDINGS                                             11

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS                     11

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES                               12

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS           12

ITEM 5.  OTHER INFORMATION                                             12

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K                              12

SIGNATURE

<PAGE>


PART I.

ITEM 1.   FINANCIAL STATEMENTS.

                                    eCONNECT
                                 BALANCE SHEET
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                      June 30,
                                                                                        2002
                                                                                 ------------------
                                               ASSETS
<S>                                                                             <C>
Current assets
      Inventory                                                                  $          187,264
                                                                                 ------------------
           Total current assets                                                             187,264

Fixed assets, net                                                                           186,793

Other assets
      Deposit                                                                                24,819
      Other assets                                                                           76,655
                                                                                 ------------------
           Total other assets                                                               101,474
                                                                                 ------------------

Total assets                                                                     $          475,531
                                                                                 ==================

                               LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities
      Bank overdraft                                                             $           68,518
      Accounts payable                                                                    2,411,327
      Accrued liabilities                                                                 3,258,434
      Due to related parties                                                              2,606,647
      Deferred revenue                                                                        6,291
      Legal settlement liability                                                          4,658,200
      Advance on equity funding line                                                             --
      Notes payable                                                                       1,394,868
                                                                                 ------------------
           Total current liabilities                                                     14,404,285
                                                                                 ------------------

           Total liabilities                                                             14,404,285

Commitments and contingencies                                                                    --

Stockholders' deficit
      Common stock; $.001 par value; 750,000,000
         shares authorized, 7,989,583 shares
         issued and outstanding                                                               7,990
      Additional paid-in capital                                                        202,416,072
      Accumulated deficit                                                              (216,352,816)
                                                                                 ------------------
           Total stockholders' deficit                                                  (13,928,754)
                                                                                 ------------------

           Total liabilities and stockholders' deficit                           $          475,531
                                                                                 ==================
</TABLE>

                 See Accompanying Notes to Financial Statements




                                    eCONNECT
                            STATEMENTS OF OPERATIONS
                                  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                            Three months ended June 30,
                                                                     -------------------------------------------
                                                                             2002                   2001
                                                                     --------------------   --------------------
<S>                                                                  <C>                    <C>
Revenue                                                              $              1,529   $                425

Cost of revenue                                                                       909                     --
                                                                     --------------------   --------------------

        Gross income                                                                  620                    425

Operating expenses
     Stock based compensation and expenses                                     43,960,385              2,410,142
     Consulting                                                                   382,313                334,356
     Public relations & advertising                                               166,351                  8,430
     Professional fees                                                             65,116                223,799
     Research and development                                                      (1,260)                    --
     Wages                                                                         74,886                533,008
     Amortization and depreciation                                                 22,743                413,125
     General and administrative                                                   161,408                291,292
                                                                     --------------------   --------------------

        Total operating expenses                                               44,831,942              4,214,152
                                                                     --------------------   --------------------

Net loss from operations                                                      (44,831,322)            (4,213,727)

Other income (expense)
     Interest income                                                                   --                 18,659
     Interest expense                                                             (30,870)              (776,823)
     Loss on investments                                                               --               (233,770)
     Cancellation fee                                                                  --                     --
     Legal settlement                                                          (4,010,650)            (1,739,706)
                                                                     --------------------   --------------------

        Total other income (expense)                                           (4,041,520)            (2,731,640)
                                                                     --------------------   --------------------

Net loss before provision for income taxes                                    (48,872,842)            (6,945,367)

Provision for income taxes                                                             --                     --
                                                                     --------------------   --------------------

Net loss from continuing operations                                           (48,872,842)            (6,945,367)

Discontinued operations
     Loss from discontinued gaming operations
        from January 1, 2001 to June 30, 2001
        (net of income tax benefit which is fully
        allowed for)                                                                   --            (160,107.00)
     Estimated loss on disposal of gaming operations
        including losses during the phase-out period
        (net of income tax benefit which is fully allowed for)                         --             (96,661.00)
                                                                     -------------------------------------------
                                                                                       --            (256,768.00)

Net loss                                                             $        (48,872,842)  $         (7,202,135)
                                                                     ====================   ====================

Earning per share
     Loss from continuing operations                                 $              (6.92)  $              (2.55)
     Loss from discontinued operations                                                 --                  (0.06)
     Loss from abandonment of gaming operations                                        --                  (0.04)
                                                                     --------------------   --------------------
     Net loss                                                        $              (6.92)  $              (2.64)
                                                                     ====================   ====================

Basic and diluted weighted average
     common shares outstanding                                                  7,060,312              2,720,555
                                                                     ====================   ====================

<CAPTION>
                                                                              Six months ended June 30,
                                                                     -------------------------------------------
                                                                             2002                   2001
                                                                     --------------------   --------------------
<S>                                                                  <C>                    <C>
Revenue                                                              $              9,011                  1,604

Cost of revenue                                                                     4,304                    --
                                                                     --------------------   --------------------

        Gross income                                                                4,707                  1,604

Operating expenses
     Stock based compensation and expenses                                     45,559,008              4,376,193
     Consulting                                                                   946,574                565,649
     Public relations & advertising                                               372,590                 83,160
     Professional fees                                                             81,084                341,657
     Research and development                                                      26,390                 54,300
     Wages                                                                        164,386                999,364
     Amortization and depreciation                                                 45,487                671,468
     General and administrative                                                   406,649                477,409
                                                                     --------------------   --------------------

        Total operating expenses                                               47,602,168              7,569,200
                                                                     --------------------   --------------------

Net loss from operations                                                      (47,597,461)            (7,567,596)

Other income (expense)
     Interest income                                                                   --                 18,659
     Interest expense                                                             (76,975)              (944,425)
     Loss on investments                                                               --               (233,770)
     Cancellation fee                                                                  --               (526,212)
     Legal settlement                                                          (4,014,909)            (1,739,706)
                                                                     --------------------   --------------------

        Total other income (expense)                                           (4,091,884)            (3,425,454)
                                                                     --------------------   --------------------

Net loss before provision for income taxes                                    (51,689,345)           (10,993,050)

Provision for income taxes                                                           (800)                    --
                                                                     --------------------   --------------------

Net loss from continuing operations                                           (51,690,145)           (10,993,050)

Discontinued operations
     Loss from discontinued gaming operations
        from January 1, 2001 to June 30, 2001
        (net of income tax benefit which is fully
        allowed for)                                                                   --            (215,086.00)
     Estimated loss on disposal of gaming operations
        including losses during the phase-out period
        (net of income tax benefit which is fully allowed for)                         --             (96,661.00)
                                                                     -------------------------------------------
                                                                                       --            (311,747.00)

Net loss                                                             $        (51,690,145)  $        (11,304,797)
                                                                     ====================   ====================

Earning per share
     Loss from continuing operations                                 $              (8.96)  $              (4.22)
     Loss from discontinued operations                                                 --                  (0.08)
     Loss from abandonment of gaming operations                                        --                  (0.04)
                                                                     --------------------   --------------------
     Net loss                                                        $              (8.96)  $              (4.34)
                                                                     ====================   ====================

Basic and diluted weighted average
     common shares outstanding                                                  5,767,809              2,607,943
                                                                     ====================   ====================
</TABLE>

                 See Accompanying Notes to Financial Statements




                                    eCONNECT
                       STATEMENT OF STOCKHOLDERS' DEFICIT
                                  (UNAUDITED)
<TABLE>
<CAPTION>
                                                                                   Common Stock                  Additional
                                                                           -------------------------------
                                                                             Number of                            Paid-in
                                                                               Shares           Amount            Capital
                                                                           --------------   --------------  -------------------
<S>                                                                        <C>              <C>             <C>
Balance, December 31, 2001                                                      4,719,316   $        4,719  $       154,434,273

 Common shares issued for cash to Alpha Venture
   Capital, Inc., net of offering costs of $266,674                               266,688              267              462,533

 Common shares in satisfaction of advance
   on equity funding line                                                          16,667               17               49,983

 Common shares issued for cash, net of
   offering costs of $301,678                                                   1,217,106            1,217              865,238

 Common shares issued for cash related to exercise of
   options and warrants, $0.01                                                    278,000              278              282,972

 Common shares issued in satisfaction of due to related party                     153,846              154              299,846

 Common shares issued for stock based compensation                              1,056,201            1,056            1,580,705

 Warrants granted for services                                                         --               --           43,854,730

 Common shares issued in satisfaction of notes payable,
   including interest of $122,517 and accrued liabilities of $36,900              281,759              282              585,792

 Net loss                                                                              --               --                   --
                                                                           --------------   --------------  -------------------

Balance, June 30, 2002                                                          7,989,583   $        7,990  $       202,416,072
                                                                           ==============   ==============  ===================

<CAPTION>
                                                                                                         Total
                                                                                Accumulated          Stockholders'
                                                                                  Deficit              Deficit
                                                                           ---------------------  ------------------
<S>                                                                        <C>                    <C>
Balance, December 31, 2001                                                 $        (164,662,671) $      (10,223,679)

 Common shares issued for cash to Alpha Venture
   Capital, Inc., net of offering costs of $266,674                                           --             462,800

 Common shares in satisfaction of advance
   on equity funding line                                                                     --              50,000

 Common shares issued for cash, net of
   offering costs of $301,678                                                                 --             866,455

 Common shares issued for cash related to exercise of
   options and warrants, $0.01                                                                --             283,250

 Common shares issued in satisfaction of due to related party                                 --             300,000

 Common shares issued for stock based compensation                                            --           1,581,761

 Warrants granted for services                                                                --          43,854,730

 Common shares issued in satisfaction of notes payable,
   including interest of $122,517 and accrued liabilities of $36,900                          --             586,074

 Net loss                                                                            (51,690,145)        (51,690,145)
                                                                           ---------------------  ------------------

Balance, June 30, 2002                                                     $        (216,352,816) $      (13,928,754)
                                                                           =====================  ==================
</TABLE>

                 See Accompanying Notes to Financial Statements


                                    eCONNECT
                             STATEMENTS OF CASH FLOW
                                  (UNAUDITED)
<TABLE>
<CAPTION>
                                                                                           For the six months ended June 30,
                                                                                     ---------------------------------------------
                                                                                               2002                     2001
                                                                                     ------------------------      ---------------
<S>                                                                                  <C>                           <C>
Cash flows from operating activities:
     Net loss                                                                        $      (51,690,145)           $   (11,304,797)
     Adjustments to reconcile net loss to net
      cash used by operating activities:
         Amortization and depreciation                                                           45,487                    671,468
         Stock based compensation                                                            45,559,008                  4,376,193
         Cancellation fee                                                                            --                    526,212
         Loss on investments                                                                         --                    233,770
         Estimated loss on disposal of gaming operations                                             --                     96,661
     Changes in operating assets and liabilities:
         Change in accounts receivable                                                               --                     14,157
         Change in inventory                                                                     (7,245)                        --
         Change in other assets                                                                 293,854                     86,610
         Change in bank overdraft                                                                38,295                         --
         Change in accounts payable                                                             361,771                    543,243
         Change in accrued liabilities                                                          223,117                    173,495
         Change in due to consultants                                                                --                     22,000
         Change in due to related parties                                                       293,878                  1,465,639
         Change in deferred revenue                                                               5,617                         --
         Change in legal settlement liability                                                 3,258,500                  1,605,000
                                                                                     ------------------      ---------------------
                 Net cash used by operating activities                                       (1,617,863)                (1,490,349)

Cash flows from investing activities:
     Purchase of fixed assets                                                                    (4,642)                   (31,884)
                                                                                     ------------------      ---------------------
                 Net cash used by investing activities                                           (4,642)                   (31,884)

Cash flows from financing activities:
     Proceeds from issuance of notes payable                                                     38,000                    237,500
     Principal payments on notes payable                                                        (28,000)                  (685,000)
     Proceeds from issuance of common stock                                                   1,612,505                  1,956,726
                                                                                     ------------------      ---------------------
                 Net cash provided by financing activities                                    1,622,505                  1,509,226
                                                                                     ------------------      ---------------------

Net change in cash                                                                                   --                    (13,007)

Cash, beginning of period                                                                            --                     13,007
                                                                                     ------------------      ---------------------

Cash, end of period                                                                  $               --      $                  --
                                                                                     ==================      =====================
Supplemental disclosure of cash flow:
     Cash paid for interest                                                          $           46,105      $             107,000
                                                                                     ==================      =====================
     Cash paid for taxes                                                             $               --      $                  --
                                                                                     ==================      =====================
Schedule of non-cash investing and financing activities:
     6,250,000 common shares issued in satisfaction
         of accounts payable                                                         $          117,956      $                  --
                                                                                     ==================      =====================
     2,000,000 common shares issued in satisfaction
         of due to related parties                                                   $           30,780      $                  --
                                                                                     ==================      =====================
     500,000 common shares issued in satisfaction
         of settlement liabilities                                                   $            5,000      $                  --
                                                                                     ==================      =====================
     6,800,000 common shares issued in satisfaction of notes payable,
          not including interest of $28,997                                          $           97,921      $                  --
                                                                                     ==================      =====================
     15,384,615 common shares issued in satisfaction
         of due to related parties                                                   $          300,000      $                  --
                                                                                     ==================      =====================
     1,666,667 common shares issued in satisfaction
         of advance on equity funding line                                           $           50,000      $                  --
                                                                                     ==================      =====================
      12,625,878 common shares issued in satisfaction of notes payable,
          not including interest of $93,520 and accrued liabilities of $36,900       $          175,000      $                  --
                                                                                     ==================      =====================
     2,501,538 common shares issued for receivable
         from equity funding line                                                    $               --      $             243,900
                                                                                     ==================      =====================
     11,800,000 common shares issued for prepaid
         consulting services                                                         $               --      $           4,146,930
                                                                                     ==================      =====================
     8,000,000 common shares issued in satisfaction
         of due to related parties                                                   $               --      $           3,696,243
                                                                                     ==================      =====================
     2,400,000 common shares issued in satisfaction
         of due to consultants                                                       $               --      $           2,020,447
                                                                                     ==================      =====================
     2,118,975 common shares issued in satisfaction
         of advance on equity funding line                                           $               --      $             206,600
                                                                                     ==================      =====================
     Warrants granted in satisfaction of promissory
         note payable, not including interest of $265,447                            $               --      $              60,000
                                                                                     ==================      =====================
</TABLE>

                 See Accompanying Notes to Financial Statements





                                    eCONNECT
                         NOTES TO FINANCIAL STATEMENTS
                                  (UNAUDITED)






1.   BASIS OF PRESENTATION

     The accompanying financial statements have been prepared in accordance with
     Securities and Exchange Commission requirements for interim financial
     statements. Therefore, they do not include all of the information and
     footnotes required by accounting principles generally accepted in the
     United States for complete financial statements. The financial statements
     should be read in conjunction with the Forms 10-KSB for the year ended
     December 31, 2001 of eConnect (the "Company").

     The interim financial information is unaudited. In the opinion of
     management, all adjustments necessary to present fairly the financial
     position as of June 30, 2002 and the results of operations and cash flows
     presented herein have been included in the financial statements. Interim
     results are not necessarily indicative of results of operations for the
     full year.

     The preparation of financial statements in conformity with accounting
     principles generally accepted in the United States 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.

     1-for-100 reverse stock split - During July 2002, the Company's Board of
     Directors adopted a resolution whereby it approved a 1-for-100 reverse
     stock split of the issued and outstanding shares of common stock.
     Accordingly, the accompanying financial statements have been retroactively
     restated to reflect the 1-for-100 reverse stock split as if such forward
     stock split occurred as of the Company's date of inception.

2.   LEGAL SETTLEMENT LIABILITIES

     a.   3Pea Technologies, Inc. - During June 2002, the Company reached a
          settlement with 3Pea Technologies, Inc., a company substantially owned
          by the son-in-law of Thomas S. Hughes, Chief Executive Officer and
          Director of the Company, whereby the Company agreed to issue 5,000,000
          shares of the Company's common stock valued at $2,050,000 and two
          installments of $190,000 to be made during July 2002. As of June 30,
          2002, the Company's balance of $2,430,000 has been included as part of
          the total legal settlement liability of $4,658,200 at June 30, 2002.

     b.   Former President and Chief Operating Officer for the Company - During
          March 2002, the Company made an installment payment of $30,000 to the
          former president and chief operating officer of the Company. As of
          March 31, 2002, the Company had a remaining unpaid balance of $820,000
          which has been included as part of legal settlement liabilities
          totaling $4,658,200.

     c.   Goldstake Enterprises, Inc. - During the six months ended June 30,
          2002, the Company made installment payments totaling $126,500 to
          Goldstake Enterprises, Inc. As of June 30, 2002, the Company had a
          remaining unpaid balance of $353,200 which has been included as part
          of the total legal settlement liability of $4,658,200 at June 30,
          2002.

          During June 2002, the Company reached an additional settlement with
          Goldstake Enterprises, Inc. and Las Vegas International Basketball
          League Franchise, LLC, whereby the Company agreed to pay $1,000,000
          with interest commencing on August 1, 2003 at an annual interest rate
          of 8%. Monthly payments of $25,000 are scheduled to commence on August
          1, 2002. As of June 30, 2002, the additional settlement of $1,000,000
          has been included as part of legal settlement liabilities totaling
          $4,658,200. Pursuant to the settlement agreement, the Company issued
          300,000 shares of the Company's common stock and will issue up to
          30,000,000 additional shares of the Company's common stock to satisfy
          all remaining debts totaling $1,353,200 as of June 30, 2002, between
          the Company and Goldstake Enterprises, Inc.





                                    eCONNECT
                         NOTES TO FINANCIAL STATEMENTS
                                  (UNAUDITED)




     d.   Other settlements - During the six months ended March 31, 2002, the
          Company made installments totaling $20,000 related to other
          settlements. As of June 30, 2002, the Company had a remaining unpaid
          balance of $55,000 which has been included as part of the total legal
          settlement liability of $4,658,200 at June 30, 2002.

3.   STOCK BASED COMPENSATION

     For the three months ended June 30, 2002 and 2001, the Company incurred
     expenses resulting from stock warrants and common stock issued totaling
     $43,960,385 and $2,410,142, respectively. For the six months ended June 30,
     2002 and 2001, the Company incurred expenses resulting from stock warrants
     and common stock issued totaling $45,559,008 and $4,376,193, respectively.
     The following table summarizes the Company's stock based compensation
     activities based on the accounts shown on the statements of operations:

<TABLE>
<CAPTION>


                                       Three months ended June 30,         Six months ended June 30,
                                    ---------------------------------  ---------------------------------
                                         2002               2001            2002              2001
                                    ---------------  ----------------  ---------------  ----------------
<S>                                  <C>             <C>               <C>               <C>
         Consulting                 $       361,134  $      2,041,136  $     1,503,842  $      3,622,691
         Penalty fee                             --                --          292,500                --
         Legal settlement                   337,735                --          337,735                --
         Finance fee                     43,203,730                --       43,203,730                --
         Interest                            57,786           369,006          221,201           753,502
                                    ---------------  ----------------  ---------------  ----------------

             Total stock based
             compensation           $    43,960,385  $      2,410,142  $    45,559,008  $      4,376,193
                                    ===============  ================  ===============  ================
</TABLE>

4.   RELATED PARTY TRANSACTIONS
<TABLE>
<CAPTION>

     Due to related parties - As of June 30, 2002, due to related parties
totaling $2,606,647 are comprised of the following:
<S>                                                                                   <C>
         Common stock due to ET&T related 65,220 shares provided by
           ET&T for use by the Company                                                  $          163,846

         Advances from ET&T, unsecured, bearing no interest                                        106,370

         Advances from Alliance Equities (company controlled by Richard Epstein,
           a significant stockholder of the Company), unsecured, bearing
           no interest                                                                             187,508

         Deposit related to the purchase of  eCashPad terminals                                    250,000

         Value of remaining 18,000 common stocks and warrants for 25,000 shares
           of the Company's common stock to be issued to Paul Egan (a
           stockholder of the Company) related to the fiscal year
           1999 acquisition of Top Sports, S.A.                                                    261,228

         Advances from an affiliate, unsecured, due on demand and bearing
           no interest                                                                             709,785

         Advances from Paul Egan, unsecured, due on demand, and bearing
           no interest                                                                             927,910
                                                                                        ------------------
               Total due to related parties                                             $        2,606,647
                                                                                        ==================

</TABLE>





                                    eCONNECT

                         NOTES TO FINANCIAL STATEMENTS
                                  (UNAUDITED)



4.   RELATED PARTY TRANSACTIONS (continued)

     Satisfaction of due to related parties - During February 2002, the Company
     issued 153,846 shares of the Company's common stock to satisfy balances due
     Richard Epstein and Alliance Equities (hereafter referred to as
     "Alliance"), totaling $300,000. As of June 30, 2002, the Company borrowed
     an additional $187,508 from Alliance which has been included as part of due
     to related parties totaling $2,606,674.

     Richard Epstein stock warrants - During February 2002, Richard Epstein
     exercised stock warrants to purchase 680,000 shares of the Company's common
     stock for $68,000.

     During May 2002, Richard Epstein was granted 60,599,106 (post reverse stock
     split) warrants to purchase shares of the Company's common stock for 50% of
     the closing bid price and expire one year from grant date for a finance
     fee. The Company estimates the fair value of Mr. Epstein's stock warrants
     granted by using the Black-Scholes option pricing-model with the following
     weighted average assumptions; no dividend yield; expected volatility of
     318%; risk free interest rates of 1.79%; and expected lives of 6 months.
     Accordingly, the Company recorded interest expenses under SFAS No. 123
     relating to non-statutory stock warrants that became exercisable upon grant
     for $43,203,730 as of June 30, 2002.

     ET&T super-voting rights - In February 2002, the board of directors of
     eConnect passed a resolution granting ET&T super-voting rights in keeping
     with the original formation of eConnect in February 1997. This allows ET&T,
     which is controlled by Thomas S. Hughes, president, director, and
     stockholder of the Company, to have a controlling vote on issues before the
     Board of Directors.

     Penalty fee - During February 2002, the Company issued 150,000 shares of
     the Company's common stock to Alliance in satisfaction of a penalty expense
     totaling $292,500. The Company agreed to pay Alliance a penalty of 150,000
     shares due to delays in issuances of its common stock to Alliance.

5.   STOCK OPTIONS

     Stock options granted to consultants - During January 2002, the Company
     granted stock options to purchase 210,000 shares of the Company's common
     stock with an exercise price equal to 50% of the closing bid price of its
     common stock upon the date of exercise. These stock options were granted in
     connection with a consulting agreement. The Company has estimated the fair
     value of the warrant using the Black-Scholes pricing-model with the
     following assumptions: no dividend yield; expected volatility of 297%; risk
     free interest rates of 1.689%; and an expected life of 2 months.
     Compensation under the grant totaled $651,000 for the three months ended
     March 31, 2002. During February and March 2002, the 210,000 options were
     exercised for $215,250.

6.   FORMATION OF SUBSIDIARY

     eGS, Inc. - During March 2002, the Company incorporated eGS, Inc. in the
     State of Nevada to serve as the Company's internet agent for future state
     regulated and licensed games of chance and skill. As of June 30, 2002, the
     Company owns approximately 70% of eGS, Inc. The remaining balance of 30%
     had been distributed pursuant to a stock dividend to all of its
     stockholders of record as of April 3, 2002. The stockholders received one
     common share of eGS, Inc. for every 100 pre-reverse split share held of the
     Company's common stock as of April 3, 2002. The Company intends to maintain
     a majority ownership of eGS, Inc. eGS, Inc. is in the start-up phase,
     therefore no revenue has been recorded and all start-up costs have been
     expensed. As of June 30, 2002, eGS, Inc. has no assets or liabilities.






                                    eCONNECT
                         NOTES TO FINANCIAL STATEMENTS
                                  (UNAUDITED)



7.   Going Concern

     The Company incurred a net loss of approximately $51,690,000 for the six
     months ended June 30, 2002. The Company's current liabilities exceed its
     current assets by approximately $14,217,000 as of June 30, 2002. These
     factors create substantial doubt about the Company's ability to continue as
     a going concern. The Company's management has developed a plan to complete
     the development of technology products and create their respective markets
     to generate future revenues. The Company will also seek additional sources
     of capital through the issuance of debt and equity financing, but there can
     be no assurance that the Company will be successful in accomplishing its
     objectives.

     The ability of the Company to continue as a going concern is dependent on
     additional sources of capital and the success of the Company's plan. The
     financial statements do not include any adjustments that might be necessary
     if the Company is unable to continue as a going concern.

8.   SUBSEQUENT EVENTS

     Pacific Nakon - During July 2002, the Company received a letter of intent
     from Pacific Nakon International, Inc. ("PNI") whereby PNI, in conjunction
     with Valet, Inc. and Electronic Valet Systems, Inc., proposed the
     following:

     (i)  PNI would provide ownership of all equity interests in Valet, Inc. and
          Electronic Valet Systems, Inc. for the purpose of implementing this
          business transaction in exchange for the Company providing and
          installing 10,000 eCashPads
     (ii) The parties will create a new corporation to serve as the repository
          of the equity interest noted in the letter of intent with the
          ownership being negotiated in not less than 20 banking days
    (iii) PNI will issue to the Company $20,000,000 in asset backed corporate
          debentures for the purpose of enhancing the balance sheet of eConnect.
          Such bonds will have a term of seven years and shall earn interest at
          8.5% per year to be payable in arrears
     (iv) All parties intend to pay a loan with an undisclosed balance and
          provide two bonds for totaling $7,000,000 to acquire all assets owned
          by F.F.S., LLC and their membership units
     (v)  The Company will issue 2,000,000 share of common stock to the
          participating parties

     This letter of intent is subject to a formalized contract that has not been
     prepared to date.

     Electronic Valet Systems, Inc. - During July 2002, the Company signed a
     letter of intent to establish a strategic agreement to develop a money
     transfer system between the United States and Mexico with Electronic Valet
     Systems, Inc. Upon signing the letter of intent, the Company agreed to pay
     $150,000 and issue 10,000,000 shares of the Company's common stock to
     Abelardo Castillo, Sr. of Electronic Valet Systems, Inc. On August 15, 2002
     the Company is required pay an additional $3,000,000 to Electronic Valet
     Systems, Inc. with a final payment of $2,500,000 due 60 days from date of
     the strategic agreement. In the event of any breach of the agreement by the
     Company, the entire agreement will be cancelled without notice and all
     consideration will not be reimbursed to the Company. Through the date of
     this report, no consideration for the letter of intent has been delivered
     by the Company.

     Transaction Systems, LLC - During July 2002, the Company signed a letter of
     intent with Transaction Systems, LLC, whereby the Company desires to
     acquire all membership units and an exclusive license for Merlin 2, ePos2,
     and Gaming Software in consideration of registered shares valued at
     $1,000,000 determined at the date of closing. Merlin2 is a web based
     front-end system for the loading and sale of prepaid cards. ePos2 is a
     point-of-sale software that allows prepaid cards to be sold and loaded in
     real time via Merlin2 interface. Gaming Software supports Internet gaming
     from the front-end to the back-end which allows casinos to create private
     label accounts and can interface with Merlin2 and allow customers to move
     their winnings to a debit card. Through the date of this report, no
     consideration for the letter of intent has been delivered by the Company.






                                    eCONNECT
                         NOTES TO FINANCIAL STATEMENTS
                                  (UNAUDITED)



8.   SUBSEQUENT EVENTS (continued)

     eConnect Financial - During July 2002, the Company entered into an
     agreement with Alan J. Conner & Associates to jointly form eConnect
     Financial to operate an Internet Bank under a joint venture with InterState
     Net Bank. eConnect Financial will issue sub prime credit cards, credit
     insurance and open bank accounts through eCashPad users with Allan J.
     Conner acting as the president. The Company shall fund $1,500,000 by August
     2, 2002 with $500,000 to be allocated towards the purchase of capital stock
     in Interstate Net Bank and $1,000,000 allocated towards operations of the
     venture. Additionally, the Company will grant 10,000,000 warrants to
     purchase shares of the Company's common stock for 25% below the close bid
     price on the 15th day of each month for 12 months from the effective date
     of the agreement. The venture will be divided into two divisions: Division
     I consisting of the sub prime credit card division with 70% owned by Allan
     J. Conner & Associates, 20% owned by the Company and 10% owned by PNI;
     Division II consisting of the eCashPad universal usage with 70% owned by
     the Company, 20% owned by Allan J. Conner & Associates and 10% owned by
     PNI. The Company did not meet the funding requirements pursuant to the
     agreement, therefore the agreement has been cancelled and no additional
     commitments by Alan J. Conner & Associates are required.

     Halted trading of stock - On July 25, 2002, the SEC suspended trading of
     the Company's common stock in connection with an investigation of the
     Company's accuracy of several claims, including the claimed value of the
     bonds PNI invested into the Company, the stated projected opening date of
     eConnect Financial, and the value of a purchase order from another company.
     The Company's common stock resumed trading on August 8, 2002; however, from
     that date to the date of this report, the Company's common stock has been
     trading on the National Quotation Bureau's Pink Sheets, since brokerage
     firms who make a market in the Company's common stock on the
     Over-The-Counter Bulletin Board ("OTCBB") are not willing to do so at this
     time.

     Allegations of violation of securities law and consent decree of 2000 - On
     August 7, 2002, Thomas S. Hughes, Chief Executive Officer and Director of
     the Company, was served with a complaint by federal authorities alleging i)
     contempt of court pursuant to a permanent injunction issued on April 7,
     2000 by issuing and/or approving issuance of false and misleading press
     releases and failing to disclose material facts in connection with the
     issuance of press releases and (ii) securities fraud in connection with the
     purchase and sale of the Company's common stock. Remedies sought in these
     proceedings include criminal and civil penalties and a bar from service as
     an officer or director of a publicly-traded company. Although the Company
     believes the charges are unwarranted, and intends to vigorously defend
     against them, there can be no assurance that Mr. Hughes will be able to
     continue to serve as its Chief Executive Officer in the event that the
     Securities and Exchange Commission and Department of Justice receive the
     remedies they seek. The loss of Mr. Hughes could have a material adverse
     impact on the Company's business and financial condition.




                                       3

<PAGE>

ITEM 2. PLAN OF OPERATION

Twelve Month Plan of Operation.

Currently, the Company has completed an updated version 2.0 of the Bank Eyes
Only System,
which allows merchants to receive transactions from consumers using the
eCashPad. These transactions are initially received by the "Bank Eyes Only"
System and then routed to certified credit card gateway processors

With the updated 2.0 Bank Eyes Only version, eCashPad users can pay directly at
the web merchant site without a shopping cart being required and additionally,
the Version 2 Platform can now support eCashCard cash payments.

The Company's web site is: www.econnectholdings.com. To date over 7,000 plus
eCashPads have been distributed into the United States marketplace with
scheduled shipments of 9,000 additional eCashPad now in process.

The company's eCashPad product and BEO processing service is positioned
effectively to take advantage of market needs for secure internet payments. The
company believes that "Bank Eyes Only" transaction processing system will
addresses Internet consumers' concerns regarding personal and financial
information security. The company has published the "Bank Eyes Only" Web
merchant install download documentation.

The marketing strategies for the Company is to acquire merchants through
internal profession sales force, external distributors, and managed resellers;
and acquire consumers through direct distribution, retail, and managed
resellers.

The Company is also working on expanding the usage of the eCashPad to effect
payments to any web merchant with a same as cash eCashCard payment. Consumers
will use their value added private labeled eCashPad to effect cash payments with
their eCashPad at the web merchant's page.

     In addition, the company has structured a networking approach for mass
market consumer participation in finding "Bank Eyes Only" merchants along with
sales teams to sign on local web merchants. Using a revenue sharing plan from
the flat fee, the company will incentivize private labels of eCashPads with
expected advertising and marketing of private label eCashPads by the vendors to
their consumer base. Further registration of "Bank Eyes Only" web merchants will
likewise be pursued by a team of specialists who understand a specific industry
such as phone, cable or collections. These team of specialists will develop the
pertinent "Bank Eyes Only" application for that industry and will cultivate
strategic alliances within their specific industry. The company is projecting an
average transaction revenue of 50 cents per usage which is charged to the web
merchant.

     The company envisions the usage of the eCashPad to affect Internet cash
wagers by either ATM card with PIN or by chip card payments. The Company has
formed a subsidiary called eGS, Inc. to exploit this market. eGS will provide
support services for State Regulated and licensed Internet companies offering
games of skill and games of chance whereby players may use their eCashPad with
ATM card and PIN entry to effect on line cash transactions.

The Company is also diligently working on the usage of the eCashPad to effect
PIN on line debit with either a swiped ATM card or debit card. This is known as
a POS transaction and will enable immediate cash payments to the web merchant in
the same way a cash payment is made at the supermarket with a POS transaction.
The Company reasonably expects to see PIN debit begin this year but can not
guarantee such POS Internet payments to begin.

Capital Resources

The company expects to continue to generate enough cash for its operations and
business plan over the next twelve months. The company will from time to time
elect to access equity funding from Alpha. The company expects to continue and
increase production of revenues over the next 12 months from sales of eCashPads
and BEO Processing services. The Company will raise additional equity funding if
necessary.

Definitions

     "Bank Eyes Only" refers to a direct Internet connection between the
consumer's terminal and the company's bank card authorization system by which
the consumer will order an item from an Internet merchant, but the credit card
data or ATM data will go directly through the Company's server to the bank,
bypassing the merchant. Thus, this service will enable customers to pay for
Internet purchases, bill payments and other types of transactions from home by
physically swiping either credit cards or ATM cards with PIN entry. "Bank Eyes
Only" transactions are processed over the Internet without the cardholder
account information being stored at the merchant's web site, nor does the
merchant have access to the consumer's bank card information.

     "eCashPad" refers to the smart card and magnetic stripe card read/write
terminal with encrypted PIN entry utilized for remote capture of transaction
authentication. The reader utilizes USB to connect to a Personal Computer
running the windows operating system. The reader is compliant with International
Standards Organization requirements for magnetic stripe and smart card payment
capture.

                                        4

<PAGE>


          The company envisions the usage of the eCashPad to affect Internet
cash wagers by either ATM card with PIN or by chip card payments. The Company
recently formed a subsidiary called eGS, Inc. to exploit this market. eGS will
provide support services for State Regulated and licensed Internet companies
offering games of skill and games of chance whereby players may use their
eCashPad with ATM card and PIN entry to effect on line cash transactions. eGS is
being spun off by the Company to shareholders as of the record date. The
spin-off occurred on May 15, 2002.

Definitions

          "Bank Eyes Only" refers to a direct Internet connection between the
consumer's terminal and the company's bank card authorization system by which
the consumer will order an item from an Internet merchant, but the credit card
data or ATM data will go directly through the Company's server to the bank,
bypassing the merchant. Thus, this service will enable customers to pay for
Internet purchases, bill payments and other types of transactions from home by
physically swiping either credit cards or ATM cards with PIN entry. "Bank Eyes
Only" transactions are processed over the Internet without the cardholder
account information being stored at the merchant's web site, nor does the
merchant have access to the consumer's bank card information.


                                       5

<PAGE>

Forward Looking Statements.

          This report contains "forward looking statements" within the meaning
of Rule 175 under the Securities Act of 1933, as amended, and Rule 3b-6 under
the Securities Act of 1934, as amended, including statements regarding, among
other items, the company's business strategies, continued growth in the
company's markets, projections, and anticipated trends in the company's business
and the industry in which it operates. The words "believe," "expect,"
"anticipate," "intends," "forecast," "project," and similar expressions identify
forward-looking statements. These forward-looking statements are based largely
on the company's expectations and are subject to a number of risks and
uncertainties, certain of which are beyond the company's control. The company
cautions that these statements are further qualified by important factors that
could cause actual results to differ materially from those in the forward
looking statements, including, among others, the following: reduced or lack of
increase in demand for the company's products, competitive pricing pressures,
changes in the market price of ingredients used in the company's products and
the level of expenses incurred in the company's operations. In light of these
risks and uncertainties, there can be no assurance that the forward-looking
information contained herein will in fact transpire or prove to be accurate. The
company disclaims any intent or obligation to update "forward looking
statements."

                                       6

<PAGE>

PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

On August 7, 2002, the Securities and Exchange Commission filed a civil
complaint against eConnect, Thomas D. Hughes, Richard Epstein and Alliance
Equities, alleging that false press releases were made, and seeking injunctive
relief and disgorgement. The respondents are vigorously contesting the
allegations.

Halted trading of stock - On July 25, 2002, the SEC suspended trading of the
-----------------------
Company's common stock in connection with an investigation of the Company's
accuracy of several claims, including the claimed value of the bonds PNI
invested into the Company, the stated projected opening date of eConnect
Financial, and the value of a purchase order from another company. The Company's
common stock resumed trading on August 8, 2002; however, from that date to the
date of this report, the Company's common stock has been trading on the National
Quotation Bureau's Pink Sheets, since relisting procedures for the
Over-The-Counter Bulletin Board ("OTCBB") have not yet been completed.

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS.

Sales of Unregistered Securities.

Sales of unregistered securities occurring on or before March 31, 2002,
have been previously reported.

<TABLE>
<CAPTION>
                                                                                       Shares
                                                                                  -------------------------------------
                                                                  Issuance          No. of Shares             Total
Date            Name               Tradeability      PRT No.        Type               Issued             Consideration
---------------------------------------------------------------------------------------------------------------------------
<S>       <C>                     <C>                <C>        <C>               <C>                     <C>

 4/1/2002 Perro Corp              144 Restricted                Loan repayment         6,000,000             113,238
 4/3/2002 Matt Katz               Free Trading                  Consulting               250,000               5,243
 4/3/2002 John Shapiro            Free Trading                  Consulting               200,000               4,194
 4/3/2002 Don Yarter              Free Trading                  Consulting               200,000               4,194
 4/3/2002 Mike Sitrick            144 Restricted                Loan repayment         6,250,000             117,956
4/24/2002 Terry Roslington        144 Restricted                Late fees              1,549,019              28,789
 5/3/2002 Richard Epstein         Free Trading                  Loan repayment         7,500,000              37,500
 5/7/2002 William Haseltine       144 Restricted                Consulting               600,000               9,234
 5/7/2002 Mark Ninci              Free Trading                  Loan repayment           800,000              13,680
 5/7/2002 David Ninci             Free Trading                  Consulting               150,000               2,565
 5/7/2002 ET&T                    144 Restricted                Loan repayment         2,000,000              30,780
 5/7/2002 Jackie Robinson         144 Restricted                Legal Settlement       3,500,000              53,865
 5/7/2002 Chris Jensen            144 Restricted                Consulting               500,000               7,695
 5/7/2002 Don Yarter              144 Restricted                Consulting               500,000               7,695
5/20/2002 Shelly Weiser           144 Restricted                Consulting               100,000               1,277
5/20/2002 Alliance Equities       Free Trading                  Loan repayment        29,946,363             149,732
5/20/2002 Richard Epstein         Free Trading                  Loan repayment        19,964,242              99,821
5/21/2002 Jackie Robinson         Free Trading                  Legal Settlement       1,000,000              13,870
5/21/2002 Chris Jensen            Free Trading                  Consulting               500,000               6,935
5/21/2002 Don Yarter              Free Trading                  Consulting               500,000               6,935
5/21/2002 Chris Jensen            144 Restricted                Consulting               500,000               6,242
5/21/2002 Don Yarter              144 Restricted                Consulting               500,000               6,242
5/30/2002 Marylou Garcia          Free Trading                  Consulting               600,000               7,164
5/30/2002 Raymond Russell         Free Trading                  Consulting             1,000,000              11,940
5/30/2002 Jason Chester           Free Trading                  Loan repayment        11,000,000              55,000
5/30/2002 Peter Bianchi           Free Trading                  Consulting            20,000,000             238,800
6/11/2002 Joan Shapiro            144 Restricted                Consulting               600,000               5,400
6/11/2002 Julie Saxton            144 Restricted                Consulting               500,000               4,500
6/11/2002 Quinn Brady             Free Trading                  Loan repayment           500,000               5,000
6/14/2002 Julie Saxton            144 Restricted                Legal Settlement       5,000,000              45,000
6/14/2002 Julie Saxton            144 Restricted                Legal Settlement       5,000,000              45,000
6/14/2002 Julie Saxton            144 Restricted                Legal Settlement       5,000,000              45,000
6/14/2002 Frank Macac             Free Trading                  Consulting               600,000               6,000
6/14/2002 Matthew Crawford        Free Trading                  Consulting               600,000               6,000
6/17/2002 Richard Epstein         Free Trading                  Loan repayment         9,965,111              49,826
6/18/2002 Anna Morris             144 Restricted                Consulting                10,000                  90
6/18/2002 John Morris Jr.         144 Restricted                Consulting                10,000                  90
6/18/2002 Goldstake Enterprises   144 Restricted                Legal Settlement       5,000,000              45,000
6/18/2002 Goldstake Enterprises   144 Restricted                Legal Settlement       5,000,000              45,000
6/18/2002 Goldstake Enterprises   144 Restricted                Legal Settlement       5,000,000              45,000
6/18/2002 Alberto Barrera         Free Trading                  Consulting             1,000,000              10,000
6/18/2002 Rick Wilson             144 Restricted                Consulting               300,000               2,700


                                                                                   ------------------------------------
                                                                                     159,694,735           1,400,190
                                                                                   ------------------------------------
</TABLE>

No commissions or fees were paid in connection with these sales.
These transactions were exempt from the registration requirements under the
Securities Act of 1933 based on Rule 506 of Regulation D, and similar provisions
under state securities laws and regulations by the fact that:

..  The sales were made to sophisticated investors as defined in Rule 502;

..  The information specified in paragraph (b)(2)(ii)(B) and paragraph
   (b)(2)(ii)(C) of this section was provided to each investor;

..  The company gave each purchaser the opportunity to ask questions and receive
   answers concerning the terms and conditions of the offering and to obtain any
   additional information that the Company possessed or could acquire without
   unreasonable effort or expense that is necessary to verify the accuracy of
   the information furnished;

..  At a reasonable time prior to the sale of securities, the company advised the
   purchasers of the limitations on resale in the manner contained in paragraph
   Rule 502(d)(2) of this section;

..  Neither the company nor any person acting on its behalf sold the securities
   by any form of general solicitation or general advertising;

..  The company exercised reasonable care to assure that the purchasers of the
   securities are not underwriters within the meaning of section 2(11) of the
   Securities Act of 1933 in compliance with Rule 502(d).

                                       7

<PAGE>

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES.

Not Applicable.

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

None

ITEM 5.  OTHER INFORMATION.

Lawrence B. Donoghue submitted his resignation as director on August 7, 2002.

Pacific Nakon - During July 2002, the Company received a letter of intent from
-------------
Pacific Nakon International, Inc. ("PNI") whereby PNI, in conjunction with
Valet, Inc. and Electronic Valet Systems, Inc., proposed the following:

(i)   PNI would provide ownership of all equity interests in Valet, Inc. and
      Electronic Valet Systems, Inc. for the purpose of implementing this
      business transaction in exchange for the Company providing and installing
      10,000 eCashPads

(ii)  The parties will create a new corporation to serve as the repository of
      the equity interest noted in the letter of intent with the ownership being
      negotiated in not less than 20 banking days

(iii) PNI will issue to the Company $20,000,000 in asset backed corporate
      debentures for the purpose of enhancing the balance sheet of eConnect.
      Such bonds will have a term of seven years and shall earn interest at 8.5%
      per year to be payable in arrears

(iv)  All parties intend to pay a loan with an undisclosed balance and provide
      two bonds for totaling $7,000,000 to acquire all assets owned by F.F.S.,
      LLC and their membership units

(v)   The Company will issue 2,000,000 share of common stock to the
      participating parties

This letter of intent is subject to a formalized contract that has not been
prepared to date.

Electronic Valet Systems, Inc. - During July 2002, the Company signed a letter
------------------------------
of intent to establish a strategic agreement to develop a money transfer system
between the United States and Mexico with Electronic Valet Systems, Inc. Upon
signing the letter of intent, the Company agreed to pay $150,000 and issue
10,000,000 shares of the Company's common stock to Abelardo Castillo, Sr. of
Electronic Valet Systems, Inc. On August 15, 2002 the Company is required pay an
additional $3,000,000 to Electronic Valet Systems, Inc. with a final payment of
$2,500,000 due 60 days from date of the strategic agreement. In the event of any
breach of the agreement by the Company, the entire agreement will be cancelled
without notice and all consideration will not be reimbursed to the Company.
Through the date of this report, no consideration for the letter of intent has
been delivered by the Company.

Transaction Systems, LLC - During July 2002, the Company signed a letter of
------------------------
intent with Transaction Systems, LLC, whereby the Company desires to acquire all
membership units and an exclusive license for Merlin 2, ePos2, and Gaming
Software in consideration of registered shares valued at $1,000,000 determined
at the date of closing. Merlin2 is a web based front-end system for the loading
and sale of prepaid cards. ePos2 is a point-of-sale software that allows prepaid
cards to be sold and loaded in real time via Merlin2 interface. Gaming Software
supports Internet gaming from the front-end to the back-end which allows casinos
to create private label accounts and can interface with Merlin2 and allow
customers to move their winnings $$/BREAK/$$END to a debit card. Through the
date of this report, no consideration for the letter of intent has been
delivered by the Company.

eConnect Financial - During July 2002, the Company entered into an agreement
------------------
with Alan J. Conner & Associates to jointly form eConnect Financial to operate
an Internet Bank under a joint venture with InterState Net Bank. eConnect
Financial will issue sub prime credit cards, credit insurance and open bank
accounts through eCashPad users with Allan J. Conner acting as the president.
The Company shall fund $1,500,000 by August 2, 2002 with $500,000 to be
allocated towards the purchase of capital stock in Interstate Net Bank and
$1,000,000 allocated towards operations of the venture. Additionally, the
Company will grant 10,000,000 warrants to purchase shares of the Company's
common stock for 25% below the close bid price on the 15th day of each month for
12 months from the effective date of the agreement. The venture will be divided
into two divisions: Division I consisting of the sub prime credit card division
with 70% owned by Allan J. Conner & Associates, 20% owned by the Company and 10%
owned by PNI; Division II consisting of the eCashPad universal usage with 70%
owned by the Company, 20% owned by Allan J. Conner & Associates and 10% owned by
PNI. The Company did not meet the funding requirements pursuant to the
agreement, therefore the agreement has been cancelled and no additional
commitments by Alan J. Conner & Associates are required.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.

Exhibits.

                                       8

<PAGE>

Exhibits included or incorporated by reference herein are set forth in
the attached Exhibit Index.

Reports on Form 8-K.

None

                                    SIGNATURE

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.


                                       eConnect


Dated: August 20, 2002                    By: /s/ Thomas S. Hughes
                                          ------------------------------------
                                           Thomas S. Hughes, Chairman, CEO



      CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER

                                   PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


         I, Thomas S. Hughes, certify, pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the
Quarterly Report of eConnect, Inc. on Form 10-QSB for the quarterly period ended
June 30, 2002, fully complies with the requirements of Section 13(a) or 15(d) of
the Securities Exchange Act of 1934 and that information contained in such
Quarterly Report fairly presents in all material respects the financial
condition and results of operations of eConnect, Inc.

                                            By:  /s/ Thomas S. Hughes
                                                ----------------------------
                                            Name:  Thomas S. Hughes
                                            Title:  Chief Executive Officer

eConnect currently has no chief financial officer.



                                  EXHIBIT INDEX

Exhibit                       Description
No.

Exhibit No.                            Description
-----------                            -----------

2             Agreement and Plan of Merger, dated June 1, 1999 (incorporated by
              reference to Exhibit 2 of the Form 10-KSB filed on May 9, 2000).


                                       9

<PAGE>

                                 EXHIBIT INDEX

Exhibit No.                       Dexcription
-----------                       -----------

4.1          Class A Warrant Agreement (incorporated by reference to Exhibit 4.2
             of the  Form S-1 filed on October 28, 1993).

4.2          Retainer Stock Plan for Non-Employee Directors and Consultants,
             dated April 26, 1999 (incorporated by reference to Exhibit 4.1 of
             the Form S-8 filed on May 14, 1999).


<PAGE>

4.3       Common Stock Purchase Agreement between the company and Alpha Venture
          Capital, Inc., dated October 6, 2001 (incorporated by reference to the
          SB-2 filed on October 9, 2001).

10.1      Promissory Note between Electronic Transactions & Technologies and
          Unipay, Inc., dated April 26, 1999 (incorporated by reference to
          Exhibit 10.5 of the Form 10-KSB filed on May 9, 2000).


10.2      Amendment to Agreement to License Assets dated February 18, 1997
          between the company, Electronic Transactions & Technologies, and James
          Clinton, dated September 1, 1999 (incorporated by reference to Exhibit
          10.7 of the Form SB-2/A filed on May 3, 2001).

10.3      Agreement between the company and Alliance Equities, dated November
          29, 1999 (incorporated by reference to Exhibit 10.18 of the Form 10-
          KSB filed on May 9, 2000).

10.4      Secured Promissory Note issued to the company by Electronic
          Transactions & Technologies and Thomas S. Hughes, dated December 1,
          1999 (incorporated by reference to Exhibit 10.19 of the Form 10-KSB
          filed on May 9, 2000).

10.5      Security Agreement between the company, Electronic Transactions &
          Technologies, and Thomas S. Hughes, dated December 1, 1999
          (incorporated by reference to Exhibit 10.20 of the Form 10-KSB filed
          on May 9, 2000).


10.6      Software License, Development, and Maintenance Agreement (Dominican
          Republic) between the company and eFunds Corporation, dated February
          3, 2000 (incorporated by reference to Exhibit 10.34 of the Form 10-QSB
          filed on May 30, 2000).

10.7      Software License, Development, and Maintenance Agreement (Ireland)
          between the company and eFunds Corporation, dated February 4, 2000
          (incorporated by reference to Exhibit 10.36 of the Form 10-QSB filed
          on May 30, 2000).

10.8      Agreement between the company and Richard Epstein, dated February 12,
          2000 (incorporated by reference to Exhibit 10.16 of the Form 10-KSB
          filed on April 25, 2001).

10.9      Loan Agreement between the company and Richard Epstein, dated February
          15, 2000 (incorporated by reference to Exhibit 10.38 of the Form 10-
          QSB filed on May 30, 2000).

<PAGE>

10.10     Amended and Restated Secured Promissory Note issued to the company by
          Electronic Transactions & Technologies and Thomas S. Hughes, dated
          March 31, 2000 (incorporated by reference to Exhibit 10.45 of the Form
          10-QSB filed on May 30, 2000).

10.11     Amended and Restated Security Agreement between the company,
          Electronic Transactions & Technologies, and Thomas S. Hughes, dated
          March 31, 2000 (incorporated by reference to Exhibit 10.46 of the Form
          10-QSB filed on May 30, 2000).

10.12     Agreement for Sale and Plan of Reorganization between the company and
          National Data Funding Corporation, dated October 29, 2000
          (incorporated by reference to Exhibit 10.53 of the Form SB-2/A filed
          on May 3, 2001).

10.13     Purchasing Agreement between the company and 3Pea Technologies, Inc.,
          dated June 19, 2001 (incorporated by reference to Exhibit 10.56 of the
          Form SB-2 filed on July 30, 2001).

99.1      Patents: dated August 9, 1994, May 19, 1998, and September 15, 1998
          (incorporated by reference to Exhibit 99.1 of the Form 10-KSB filed on
          May 9, 2000).

99.2      Trademarks: filed March 31, 1997, February 16, 1999, May 6, 1999, May
          24, 1999, June 3, 1999, June 4, 1999, August 12, 1999, and September
          28, 1999 (incorporated by reference to Exhibit 99.2 of the Form 10-KSB
          filed on May 9, 2000).

99.3      Trademark filed on March 15, 2000 (incorporated by reference to
          Exhibit 99.3 of the Form 10-QSB filed on May 30, 2000).