<PAGE>

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


                                    FORM 10-Q


(Mark One)

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

      For the quarterly period ended SEPTEMBER 30, 2009
                                     ------------------

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

     For the transition period from ___ to _______

                        Commission file number 000-50760
                                               ---------


                         Sancon Resources Recovery, Inc.
        (Exact name of small business issuer as specified in its charter)


                 Nevada                            58-2670972
       (State or other jurisdiction of           (IRS Employee
       incorporation or organization)          Identification No.)


                      No 2 Yinqing Lu, Songjiang District,
                             Shanghai, China, 201615
                    (Address of principal executive offices)

                                (+86) 21 67756099
                           (Issuer's telephone number)


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 and Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [_]

Indicate by check mark whether the registrant has submitted electronically and
posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T during the
preceding 12 months (or for such shorter period that the registrant was required
to submit and post such files). Yes [_] No [_]

Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of "large accelerated filer," "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer [_]                        Accelerated filer [_]
Non-accelerated filer   [_]                        Smaller reporting company [X]
(Do not check if a smaller reporting company)


          APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
                         DURING THE PRECEDING FIVE YEARS

Check whether the registrant filed all documents and reports required by Section
l2, 13 or 15(d) of the Exchange Act after the distribution of securities under a
plan confirmed by a court. Yes [_] No [_]

                      APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:

Common Stock: par value of $0.001; 22,964,996 shares issued and outstanding on
September 30, 2009.

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


<PAGE>



                        Sancon Resources Recovery, Inc.
                                    FORM 10-Q


                                      INDEX

                                                                            PAGE

           Important Notice ................................................(ii)

PART I.    FINANCIAL INFORMATION..............................................1

Item 1.    Financial Statements  (Unaudited)..................................1

Item 2.    Management's Discussion and Analysis or Plan of Operation..........12

Item 3.    Controls and Procedures............................................21

PART II.   OTHER INFORMATION..................................................22

Item 1.    Legal Proceedings..................................................22

Item 2.    Changes in Securities and Use of Proceeds..........................22

Item 3.    Default Upon Senior Securities ....................................22

Item 4.    Submission of Matters to a Vote of Security Holders................22

Item 5.    Other Information..................................................22

Item 6.    Exhibits...........................................................23

           Signatures.........................................................24


                                      (i)
<PAGE>




CAUTIONARY STATEMENT REGARDING FORWARD LOOKING INFORMATION

Certain statements in this report contain or may contain forward-looking
statements that are subject to known and unknown risks, uncertainties and other
factors which may cause actual results, performance or achievements to be
materially different from any future results, performance or achievements
expressed or implied by such forward-looking statements. These forward-looking
statements were based on various factors and were derived utilizing numerous
assumptions and other factors that could cause our actual results to differ
materially from those in the forward-looking statements. These factors include,
but are not limited to, the risk of doing business in the People' Republic of
China, or PRC, our ability to implement our strategic initiatives, our access to
sufficient capital, the effective integration of our subsidiaries in the PRC
into a U.S. public company structure, economic, political and market conditions
and fluctuations, government and industry regulation, Chinese and global
competition, and other factors. Most of these factors are difficult to predict
accurately and are generally beyond our control. You should consider the areas
of risk described in connection with any forward-looking statements that may be
made herein. Readers are cautioned not to place undue reliance on these
forward-looking statements and readers should carefully review this report in
its entirety. Except for our ongoing obligations to disclose material
information under the Federal securities laws, we undertake no obligation to
release publicly any revisions to any forward-looking statements, to report
events or to report the occurrence of unanticipated events. These
forward-looking statements speak only as of the date of this report and you
should not rely on these statements without also considering the risks and
uncertainties associated with these statements and our business.



                                     9(ii)
<PAGE>


PART I.   FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS (UNAUDITED)


<TABLE>
<CAPTION>
<S>     <C>

                                   SANCON RESOURCES RECOVERY, INC.
                                     CONSOLIDATED BALANCE SHEETS
                                             (UNAUDITED)

                                                ASSETS
                                                                           SEPTEMBER 30,  DECEMBER 31,
                                                                               2009           2008
                                                                            ----------    ----------
     Current assets
        Cash and cash equivalents                                           $3,250,522    $2,220,509
        Trade receivables, net                                                 977,547       289,240
        Inventory                                                                6,517         7,270
        Deferred Tax Asset                                                      37,291        22,107
        Other receivables                                                      317,070        64,929
        Advances and prepayments                                                72,989        75,389
        Current assets of entity disposed off                                     --         156,994
                                                                            ----------    ----------
           TOTAL CURRENT ASSETS                                              4,661,936     2,836,438

     Property, plant & equipment, net                                          852,190       927,044
      Other receivable                                                            --            --
     Security deposit                                                            9,602         7,598
     Marketable securities                                                     259,000       128,938
     Investment                                                                 43,813          --
                                                                            ----------    ----------
        TOTAL ASSETS                                                        $5,826,541    $3,900,018
                                                                            ==========    ==========

                                 LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES
     Current liabilities
        Trade payables                                                      $  995,382    $  747,786
        Capital lease - current                                                  2,846         8,735
        Accrued expenses and other payables                                    186,782       252,424
        Tax payables                                                           109,818       110,314
        Due to related parties                                                 391,755       415,304
        Other payables                                                         108,076       116,178
        Current liability of entity disposed off                                  --          24,950
                                                                            ----------    ----------
           TOTAL CURRENT LIABILITY                                           1,794,659     1,675,691

     Long term liability
        Capital lease                                                           36,872        29,175
                                                                            ----------    ----------
        TOTAL LIABILITY                                                      1,831,531     1,704,866
                                                                            ----------    ----------

           The accompanying notes form an integral of these unaudited financial statements.


                                                  1
<PAGE>


                                   SANCON RESOURCES RECOVERY, INC.
                                     CONSOLIDATED BALANCE SHEETS
                                        (UNAUDITED)(CONTINUED)


                                                                                 SEPTEMBER 30,    DECEMBER 31,
                                                                                      2009            2008
                                                                                  -----------     -----------


STOCKHOLDERS' EQUITY
     Share Capital
        Authorized: 500,000,000 common shares, par value $0.001 per share
        Issued and Outstanding: 22,964,996 shares as of September 30, 2009 and         22,965          22,615
        22,614,996 December 31, 2008 respectively
     Additional paid-in capital                                                       860,449         808,299
     Non-Controlling interest in subsidiary                                           147,874         127,829
     Deferred Compensation                                                           (128,700)       (194,400)
     Other comprehensive income                                                       113,013          62,854
     Retained Earnings                                                              2,979,409       1,367,955
                                                                                  -----------     -----------
        TOTAL STOCKHOLDERS' EQUITY                                                  3,995,010       2,195,152
                                                                                  -----------     -----------
        TOTAL LIABILITIES & STOCKHOLDERS' EQUITY                                  $ 5,826,541     $ 3,900,018
                                                                                  ===========     ===========

           The accompanying notes form an integral of these unaudited financial statements.



                                                  2
<PAGE>

                                                  SANCON RESOURCES RECOVERY, INC.
                                                 CONSOLIDATED STATEMENTS OF INCOME
                                                            (UNAUDITED)


                                                           FOR THE THREE MONTHS PERIODS ENDED      FOR THE NINE MONTHS PERIODS ENDED
                                                                        SEPTEMBER 30                          SEPTEMBER 30,
                                                                2009                  2008              2009                2008
                                                           ---------------     ---------------     --------------     --------------

Net Sales                                                  $    2,811,917     $    3,002,797     $    8,149,544     $    7,995,183
Cost of sales                                                   1,617,521          1,238,726          4,224,110          3,343,469
                                                           --------------     --------------     --------------     --------------
     Gross profit                                               1,194,396          1,764,071          3,925,434          4,651,714

Operating Expenses
     Depreciation                                                  54,958             11,493            145,268             89,699
     Selling, General and Administrative                          588,521          1,461,943          2,108,126          2,949,104
                                                           --------------     --------------     --------------     --------------
         Total operating expenses                                 643,479          1,473,436          2,253,394          3,038,803
                                                           --------------     --------------     --------------     --------------
Operating income                                                  550,917            290,635          1,672,040          1,612,911

Other Income (Expense)
     Other income                                                 (43,380)           (71,865)            (5,729)           (72,740)
     Interest income                                                3,019              2,265              4,432             28,801
                                                           --------------     --------------     --------------     --------------
     Total other income                                           (40,361)           (69,600)            (1,297)           (43,939)
                                                           --------------     --------------     --------------     --------------

Income from continued operations before income taxes
and
Discontinued Operation                                            510,556            221,035          1,670,743          1,568,972

Discontinued Operation
     Loss from Discontinuing Operation                                 --              3,155                (50)           (37,066)
     Gain/(Loss) on Disposal of Subsidiary                             --                 --             (1,834)             3,820
                                                           --------------     --------------     --------------     --------------
Gain(loss)on Discontinued Operations                                   --              3,155             (1,884)           (33,246)
                                                           --------------     --------------     --------------     --------------


Income before income taxes                                        510,556            224,190          1,668,859          1,535,726

Less: Income taxes                                                  1,348           (122,167)            37,360             46,365

Less: Net income attributed to non-controlling interest             5,196           (109,952)            20,045             42,038
                                                           --------------     --------------     --------------     --------------
Net income                                                        504,012            456,309          1,611,454          1,447,323

Other comprehensive item:
Foreign currency translation gain                                  17,099            (14,445)            50,159             28,018
                                                           --------------     --------------     --------------     --------------
Net comprehensive income                                   $      521,111            441,864     $    1,661,613     $    1,475,341
                                                           ==============     ==============     ==============     ==============

Earnings per share:
     Basic & diluted earnings/(loss) per share
     continued operations                                  $         0.02     $         0.02     $         0.07     $         0.07
                                                           ==============     ==============     ==============     ==============
     Basic earnings/(loss) per share discontinued
     operations                                            $           --     $         0.00     $        (0.00)    $        (0.00)
                                                           ==============     ==============     ==============     ==============
     Basic & diluted earnings/(loss) per share                       0.02     $         0.02     $         0.07     $         0.07
                                                           ==============     ==============     ==============     ==============
     Basic & diluted weighted average shares
     outstanding                                               22,964,996         22,110,600         22,833,746         21,518,293
                                                           ==============     ==============     ==============     ==============

                          The accompanying notes is an integral of these unaudited financial statements.


                                                                3
<PAGE>



                                 SANCON RESOURCES RECOVERY, INC.
                              CONSOLIDATED STATEMENTS OF CASH FLOWS
                                           (UNAUDITED)

                                                                     FOR THE NINE MONTHS PERIODS
                                                                          ENDED SEPTEMBER 30,
                                                                        2009            2008
                                                                     -----------     -----------

CASH FLOWS FROM OPERATING ACTIVITIES
     Net Income                                                      $ 1,611,454     $ 1,447,323
     Adjustments to reconcile net income to net cash flows
     provided by(used in) operating activities:
        Depreciation and amortization                                    145,268          89,699
        Gain on disposal of property and equipment                         9,362              --
        Shares issued in lieu of compensation & service                   65,700         162,750
        Non-Controlling interest in subsidiary                            20,045          42,038
        Changes in current assets and liabilities:
          Decrease (increase) in trade receivables                      (687,017)        105,998
          Decrease (increase) in inventory                                   753         (14,281)
          Decrease (increase) in advance to suppliers                      7,247         (86,068)
          Decrease (increase) in other current assets                   (145,176)       (286,686)
          Increase (decrease) in tax payable                                (496)        (30,636)
          Increase (decrease) in trade payable                           247,596          93,553
          Increase (decrease) in other current liabilities                35,554          65,790
                                                                     -----------     -----------
        Net cash provided by continued operations                      1,310,290       1,589,480
                                                                     -----------     -----------
        Net cash used in discontinued operations                              --         (10,153)
                                                                     -----------     -----------
        Net cash flows provided by operating activities                1,310,290       1,579,327
                                                                     -----------     -----------

CASH FLOWS FROM INVESTING ACTIVITIES
     Purchase of property and equipment                                 (285,529)       (156,604)
     Cash increased from disposal of property and equipment              152,969
     Cash decreased due to investment                                    (43,813)             --
        Net cash flows used in investing activities                     (176,373)       (156,604)
                                                                     -----------     -----------
        Net cash provided by discontinued operations                       1,854              38
                                                                     -----------     -----------
        Net cash flows used in Investing activities                     (174,519)       (156,566)
                                                                     -----------     -----------

CASH FLOWS FROM FINANCING ACTIVITIES
     Shareholders' loan                                                  (80,347)         39,543
     Proceeds from (payment of) mortgage loan                              1,808         (10,794)
                                                                     -----------     -----------
        Net cash flows provided by (used in) financing activities        (78,539)         28,749
                                                                     -----------     -----------

EFFECT OF EXCHANGE RATE CHANGES ON CASH                                  (27,219)         45,450
                                                                     -----------     -----------

NET INCREASE IN CASH & CASH EQUIVALENT                                 1,030,013       1,496,960

     Cash & Cash Equivalent at start of period                         2,220,509         238,576
                                                                     -----------     -----------
     Cash & Cash Equivalent at end of period                         $ 3,250,522     $ 1,735,536
                                                                     ===========     ===========

Supplemental information for Cash Expenses
     Cash paid for Interest Expenses                                 $     2,397     $    25,903
                                                                     ===========     ===========
     Cash paid for Income Taxes                                      $    14,174     $    46,708
                                                                     ===========     ===========

          The accompanying notes is an integral of these unaudited financial statements.
</TABLE>



                                                4
<PAGE>

                         Sancon Resources Recovery, Inc.
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                     For the period ended September 30, 2009
                                   (Unaudited)


Note 1.  Nature of Operations

Sancon Resources Recovery, Inc. ("Sancon", or "the Company", or "we", or "us")
is registered in good standing under Chapter 78 of the Nevada Statutes, and its
common stock is traded on the OTCBB under the symbol SRRY.OB. Sancon Resources
Recovery, Inc. is an environmental service and waste management company that
operates recycling facilities in China and Australia. Sancon specializes in the
collection and recovery of industrial and commercial solid wastes such as
plastic, paper, cardboard, and glass. The recycled materials are re-used by
Sancon's manufacturing customers in China to make a wide variety of new products
including outdoor furniture, construction materials, building materials, road
surface, and various new products. Sancon's China operation is licensed by the
Chinese government for waste management services, and is certified with ISO 9001
and ISO14001 standards. Sancon aims to provide solutions to today's soaring raw
material cost for manufactures and assists in solving our environmental
problems.

On August 15, 2007, the Company completed the acquisition of 70% of the equity
interest in Sancon Resources Recovery (Shanghai) Co., Ltd by exercising its
option to convert $200,000 of convertible promissory note

On November 17, 2006, the company completed the acquisition of 100% equity
interest in Crossover Solutions Inc ("Crossover" or "CS") from Fintel Group by
paying $1 for the transfer of one share of Crossover Solutions Inc. being the
total number of outstanding share of Crossover.

Since its acquisition, Crossover solution Inc has begin the operation of
providing services for management and granulation of waste materials for its
clients located in China.

On March 31, 2008, the company sold 100% equity interest of Digital Financial
Service Limited ("DFSL") for $7.8 plus the assumption of certain liabilities,
resulting in gain of $1,865 on disposal of the entity.

On March 31, 2009, the company sold 100% equity interest of Guang Cheng Int'l
Trading Ltd. ("Guang Cheng") for $1,290 plus the assumption of certain
liabilities, resulted in loss of $1,884 on disposal of the entity.

As of September 30, 2009, the Sancon group comprises of the following companies:
<TABLE>
<CAPTION>
<S>     <C>

Registered Name                                                                      Domicile           Owner     % held     Status
(business is conducted under the registered names)
Sancon Recycling Pty Ltd.                                                            Australia         Sancon       100      Active
Sancon Resources Recovery (Shanghai) Co., Ltd. ("Sancon SH" hereinafter)             Shanghai          Sancon       70       Active
Crossover Solutions Inc. ("CS" hereinafter)                                    British Virgin Island   Sancon       100      Active
</TABLE>

Note 2.  Basis of Presentation

(a)      Interim Consolidated Financial Statements

The accompanying unaudited consolidated financial statements have been prepared
in conformity with generally accepted accounting principles in the United States
of America. However, certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally accepted
accounting principles have been omitted or condensed, pursuant to the rules and
regulations of the Securities and Exchange Commission ("SEC"). In the opinion of
Sancon management, all adjustments of a normal recurring nature necessary for a
fair presentation have been included. The results for periods are not
necessarily indicative of results for the entire year. These financial
statements and accompanying notes should be read in conjunction with our annual
financial statements and the notes thereto for the year ended December 31, 2008,
included in our Annual Report on Form 10K, filed with the Securities and
Exchange Commission.

(b) Principles of Consolidation

The accompanying unaudited consolidated financial statements include all of the
accounts of the Company and all of the subsidiaries under its control, which
include Sancon Recycling Pty Ltd., Sancon SH (70%) and CS as of and for the
period ended September 30, 2009. While the historical results for the three
months and nine months period ended September 30, 2008 include the Company,
Sancon Recycling Pty Ltd., Guang Cheng, Sancon SH (70%) and CS. All material
inter-company balances and transactions have been eliminated in consolidation.


                                       5
<PAGE>

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. This basis of accounting
contemplates the recovery of the Company's assets and the satisfaction of
liabilities in the normal course of business.

Note 3.  Summary of Significant Accounting Policies

USE OF ESTIMATES

These financial statements are prepared in accordance with accounting principles
accepted generally in the USA. These principles require management to use its
best judgment in determining estimates and assumptions that: affect the reported
amounts of assets and liabilities; 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. Management makes its best
estimate of the ultimate outcome for such items based on historical trends and
other information available when the financial statements are prepared. Changes
in estimates are recognized in accordance with the relevant accounting rules,
typically in the period when new information becomes available to management.
Actual results in the future could differ from the estimates made in the prior
and current periods.

EARNINGS PER SHARE

Basic earnings per share ("EPS") is calculated using net earnings (the
numerator) divided by the weighted-average number of shares outstanding (the
denominator) during the reporting period. Diluted EPS includes the effect from
potentially dilutive securities. Diluted EPS is equal to basic EPS for all
periods presented, as the Company has no potentially dilutive securities.

REVENUE RECOGNITION

The Company's revenue recognition policies are in compliance with Staff
Accounting Bulletin (SAB) 104. Sales revenue is recognized when the significant
risks and rewards of the ownership of goods have been transferred to the buyers.
No revenue is recognized if there are significant uncertainties regarding the
recovery of the consideration due, the possible return of goods, or when the
amount of revenue and the costs incurred or to be incurred in respect of the
transaction cannot be measured reliably.

Due to the disposal of subsidiary Guang Cheng Int'l Trading Ltd., the Company
now is organized into two business segments while it was three in the last year:
material recycling and waste management service. Their revenue recognition is as
follows:

(1) Material Recycling refers to the activities of collecting and processing of
waste materials, then selling them to customers in China. The plant is located
in Australia. The revenue is recognized when delivery of the material is
occurred and invoice issued.
(2) Waste management Service refers the activities of providing waste management
service with operations located in Shanghai China. The revenue is recognized
when service is completed and invoice is issued.

INCOME TAXES

The Company has adopted Financial Accounting Standard No. 109 (SFAS 109) (ASC
740) which requires the recognition of deferred tax liabilities and assets for
the expected future tax consequences of events that have been included in the
financial statement or tax returns. Under this method, deferred tax liabilities
and assets are determined based on the difference between financial statements
and tax basis of assets and liabilities using enacted tax rates in effect for
the year in which the differences are expected to reverse.

The Company operates in several countries. As a result, we are subject to
numerous domestic and foreign tax jurisdictions and tax agreements and treaties
among the various taxing authorities. Our operations in these jurisdictions are
taxed on various bases: income before taxes, deemed profits and withholding
taxes based on revenue. The calculation of our tax liabilities involves
consideration of uncertainties in the application and interpretation of complex
tax regulations in a multitude of jurisdictions across our global operations.

We regularly assess our position with regard to individual tax exposures and
record liabilities for our uncertain tax positions and related interest and
penalties according to the principles of FAS 5, (ASC 450) Accounting for
Contingencies. These accruals reflect management's view of the likely outcomes
of current and future audits. The future resolution of these uncertain tax
positions may be different from the amounts currently accrued and therefore
could impact future tax period expense.

The Company has U.S. federal net operating loss carry forwards that if unused
could expire in varying amounts in the years through 2020 to 2026. However, as a
result of the acquisition, the amount of net operating loss carry forward
available to be utilized in reduction of future taxable income was reduced
pursuant to the change in control provisions of Section 382 of the Internal
Revenue Code.


                                       6
<PAGE>

A 100% valuation allowance has been established as a reserve against the
deferred tax assets arising from the net operating losses and other net
temporary differences since it cannot, at this time, be considered more likely
than not that their benefit will be realized in the future.

Changes in tax laws, regulations, agreements and treaties, foreign currency
exchange restrictions or our level of operations or profitability in each taxing
jurisdiction could have an impact upon the amount of income taxes that we
provide during any given year.

NON-CONTROLLING STOCKHOLDERS' INTEREST

The Company owned 70% interest in Sancon Shanghai. As at September 30, 2009 and
December 31, 2008 minority interest amounted to $147,874 and $127,829
respectively.

Certain amounts presented for prior periods that were previously designated as
minority interests have been reclassified to conform to the current year
presentation. Effective January 1, 2009, the Company adopted SFAS No. 160, (ASC
810) "Non-controlling Interests in Consolidated Financial Statements, an
amendment of ARB No. 51," which established new standards governing the
accounting for and reporting of non-controlling interests (NCIs) in partially
owned consolidated subsidiaries and the loss of control of subsidiaries. Certain
provisions of this standard indicate, among other things, that NCIs (previously
referred to as minority interests) be treated as a separate component of equity,
not as a liability (as was previously the case); that increases and decreases in
the parent's ownership interest that leave control intact be treated as equity
transactions, rather than as step acquisitions or dilution gains or losses; and
that losses of a partially owned consolidated subsidiary be allocated to the NCI
even when such allocation might result in a deficit balance. This standard also
required changes to certain presentation and disclosure requirements. The
provisions of the standard were applied to all NCIs prospectively, except for
the presentation and disclosure requirements, which were applied retrospectively
to all periods presented. As a result, upon adoption, the Company retroactively
reclassified the "Non-controlling stockholders' interest" balance previously
included in the "Other liabilities" section of the consolidated balance sheet to
a new component of equity with respect to NCIs in consolidated subsidiaries. The
adoption also impacted certain captions previously used on the consolidated
statement of income, largely identifying net loss including NCI and net loss
attributable to Octavian.

RECLASSIFICATIONS

Certain reclassifications have been made in prior period's financial statements
to conform to classifications used in the current period.

RECENT PRONOUNCEMENTS

In June 2009, the FASB issued ASC 105 (previously SFAS No. 168, THE FASB
ACCOUNTING STANDARDS CODIFICATION AND THE HIERARCHY OF GENERALLY ACCEPTED
ACCOUNTING PRINCIPLES ("GAAP") - A REPLACEMENT OF FASB STATEMENT NO. 162), (ASC
105) which will become the source of authoritative accounting principles
generally accepted in the United States recognized by the FASB to be applied to
nongovernmental entities. The Codification is effective in the third quarter of
2009, and accordingly, the Quarterly Report on Form 10-Q for the quarter ending
September 30, 2009 and all subsequent public filings will reference the
Codification as the sole source of authoritative literature. The Company does
not believe that this will have a material effect on its consolidated financial
statements.

In June 2009, the FASB issued ASC 855 (previously SFAS No. 165, SUBSEQUENT
EVENTS), which establishes general standards of accounting for and disclosures
of events that occur after the balance sheet date but before the financial
statements are issued or available to be issued. It is effective for interim and
annual periods ending after June 15, 2009. There was no material impact upon the
adoption of this standard on the Company's consolidated financial statements.

In June 2009, the FASB issued ASC 860 (previously SFAS No. 166, "Accounting for
Transfers of Financial Assets") , which requires additional information
regarding transfers of financial assets, including securitization transactions,
and where companies have continuing exposure to the risks related to transferred
financial assets. SFAS 166 eliminates the concept of a "qualifying
special-purpose entity," changes the requirements for derecognizing financial
assets, and requires additional disclosures. SFAS 166 is effective for fiscal
years beginning after November 15, 2009. The Company does not believe this
pronouncement will impact its financial statements.

In June 2009, the FASB issued ASC 810 (previously SFAS No. 167) for determining
whether to consolidate a variable interest entity. These amended standards
eliminate a mandatory quantitative approach to determine whether a variable
interest gives the entity a controlling financial interest in a variable
interest entity in favor of a qualitatively focused analysis, and require an
ongoing reassessment of whether an entity is the primary beneficiary. These
amended standards are effective for us beginning in the first quarter of fiscal
year 2010 and we are currently evaluating the impact that adoption will have on
our consolidated financial statements.

In August 2009, the FASB issued Accounting Standards Update ("ASU") 2009-05,
which amends ASC Topic 820, MEASURING LIABILITIES AT FAIR VALUE, which provides
additional guidance on the measurement of liabilities at fair value. These
amended standards clarify that in circumstances in which a quoted price in an
active market for the identical liability is not available, we are required to
use the quoted price of the identical liability when traded as an asset, quoted
prices for similar liabilities, or quoted prices for similar liabilities when
traded as assets. If these quoted prices are not available, we are required to
use another valuation technique, such as an income approach or a market
approach. These amended standards are effective for us beginning in the fourth
quarter of fiscal year 2009 and are not expected to have a significant impact on
our consolidated financial statements.

                                       7
<PAGE>

MARKETABLE SECURITIES

Company classifies investment in marketable securities as `Held to Maturity' in
accordance with SFAS 115(ASC 320). Non temporary decline in the fair value of
securities is charged to earnings while unrealized gains or losses are not
recognized as at September 30, 2009 investment in securities amounted to
$259,000 and gross unrecognized holding loss amounted to $17,130.

The marketable securities will be matured on August 19, 2010 and classified
under non current assets in the accompanied financial statements.

Note 4.  Concentrations and commitments

(a). Concentrations

The Company has focused on business in overseas markets, which the Company
believes present opportunities. A business with a foreign lessee is subject to
risks related to the economy of the country or region in which such lessee is
located, which may be weaker than the U.S. economy. On the other hand, a foreign
economy may remain strong even though the U.S. economy does not. A foreign
economic downturn may impact a foreign lessee's ability to make business
payments, even though the U.S. and other economies remain stable. Furthermore,
foreign lessees are subject to risks related to currency conversion
fluctuations.

Foreign laws, regulations and judicial procedures may be more or less protective
of lessor rights than those which apply in the United States. The Company could
experience collection or repossession problems related to the enforcement of its
business agreements under foreign local laws and the remedies in foreign
jurisdictions. The protections potentially offered by Section 1110 of the
Bankruptcy Code do not apply to non-U.S. carriers, and applicable local law may
not offer similar protections.

(b). Commitments

Office space:
The Company leases office space in Australia and China. The lease for Australia
expires in October 2011 while leases for China expire on various dates between
January 2009 and November 2018. Based upon existing leases, without renewals,
the minimum lease payments up to expiry are as follows:


                    2009          $  122,328
                                  ----------
                    2010             331,702
                                  ----------
                    2011             263,598
                                  ----------
                    2012            161,407
                                  ----------
                    2013            162,544
                                  ----------
                    Thereafter       732,000
                                  ----------
                    Total         $1,773,579
                                  ==========


The following schedule shows the composition of toral rental expense for all
operaring leases except those with terms of a month or less that were not
renewed:

                                               YEAR ENDING DECEMBER 31
                                         2009                            2008
                                         ----                            ----
Minimum Rentals                        122,328                         124,500
Contingent Rentals                        -                               -
Less Sublease Rentals                     -                               -


Equipment:
In year 2005, the company purchased a vehicle under capital lease from Toyota
Financial Service. The annual interest rate is 7.99% with payment term of sixty
(60) months. The payment is to be made in 59 equal monthly installments of $340
each and the final installment of $5,770. The balance as of September 30, 2009
amounted to $8,064 with $863 as current liability.


                                       8
<PAGE>

In year 2006, the company purchased a vehicle by mortgage loan from CBFC Limited
ABN. The annual interest rate is 8.32% with payment term of sixty (60) months.
The payment is to be made in 59 equal monthly installments of $469 each and the
final installment of $8,582. The balance as of September 30, 2009 amounted to
$17,599 with $1,047 as current liability.

In September 2007, the company purchased a vehicle by mortgage loan from CBFC
Limited ABN. The annual interest rate is 8.6% with payment term of forty-eight
(48) months. The payment is to be made in 47 equal monthly installments of $411
each and the final installment of $6,748. The balance as of September 30, 2009
amounted to $14,055 with $936 as current liability.

The Company pays approximately $1,219 per month under these leases, the last of
which expires in September 2011.

Total minimum lease payments under the above leases are as follows:

                                           Capital
                                            Leases
                                           -------

2010                                        21,728
2011                                        22,422
                                           -------
                                           $44,150
Less: Amount representing interest          (4,432)
Present value of minimum lease payments     39,718
Less: Current portion                       (2,846)
                                           -------
                                           $36,872
                                           =======

Legal Proceeding:

The company involved in the following litigation.

Dragon Wings Communications Limited, a Hong Kong corporation and Wong Yee Tat,
an individual are the first and second plaintiff. They filed a complaint on July
25, 2008 in the District Court of the Hong Kong special Administrative Region,
Civil Action No. 3251, against the first defendant, Fintel Group Limited for
breach of contract. The Company is the second defendant because plaintiff
claimed Fintel Group Limited is a wholly owned subsidiary of the Company. Under
the writ, the plaintiff claimed that pursuant to a written stock purchase
agreement, the first defendant shall purchase the first plaintiff's common stock
by common shares of Financial Telecom Limited (USA) inc. (replaced by shares of
MKA Capital Inc. from June 2006) or pay to the plaintiff cash of $94,172 in lieu
of the shares. Plus the interest and cost of litigation, the total amount
claimed by plaintiff were $104,966. The court adjudged that the first defendant
do pay the plaintiffs damages on September 08, 2008 and also adjudged that the
second defendant do pay the plaintiffs damages on December 10, 2008. The Company
denied all allegations in the complaint because Fintel Group Limited is no
longer our subsidiary since November 27, 2006. The Company accrued $104,966 of
potential liability in the accompanied financial statements based on the letter
of claim received from the plaintiff.

Note 5. Discontinued operation

On March 31, 2009, the company sold 100% equity interest of Guang Cheng Int'l
Trading Ltd. ("Guang Cheng") for $1,290 plus the assumption of certain
liabilities, resulting in loss of $1,884 on disposal of the entity.

Following is the Gain/Loss Calculation for disposal of Guang Cheng Int'l Trading
Ltd.

                                                        Guang Cheng Gain/Loss
                                                            calculation
                                                        ---------------------
Net assets of the Company as on January 1, 2009             $ 3,174

Loss from discontinued operations through March 31, 2009        (50)
                                                            -------

Total book value as of March 31, 2009                         3,124

Proceeds from disposal                                        1,290
                                                            -------
Gain (loss) on Disposal                                     $(1,834)
                                                            -------

                                                            -------
Total Gain (loss) on Discontinued Operations                $(1,884)
                                                            -------

                                       9
<PAGE>


Note 6  EQUITY INVESTMENT

Investment in Shanghai Sheng Rong

On June, 2009, Sancon Shanghai, a 70% owned subsidiary of the company, entered
into a investment agreement with Shanghai Sheng Rong Environmental Protection
Technology Co.,Ltd. to invested RMB 300,000 or $44,010 in turn held 20% equity
interest of Shanghai Sheng Rong. Shanghai Sheng Rong is an environmental service
company that operates waste electrical and electronic products in China.
Shanghai Sheng Rong was set up on June 19, 2009. As of September 30, 2009, the
Company booked investment loss of $197.

The Company's investment in equity for the years ended September 30, 2009 and
December 31, 2008 are shown as follows:

                                                 Sept 30, 2009     Dec 31, 2008
                                                 -------------     ------------
Investment in equity at beginning of year           $    --            $   --
                                                    -------            ------
Investment during the 9 month period
                                                     44,010                --
Net loss from equity investment
                                                        197                --
                                                    -------            ------
Total investment in equity at Sep 30. 2009          $43,813            $   --
                                                    =======            ======

The Company's loss from equity investment for the nine month periods ended
September 30, 2009 and 2008 are shown as follows:

                                                  Sept 30, 2009     Dec 31, 2008
                                                  -------------     ------------
I
Net loss of Shanghai Shengrong                       $(983)             $     --

Percentage of ownership in Shanghai Shengrong           20%                   --
                                                     -----              --------

Loss from equity investment                          $(197)             $     --
                                                     =====              ========


Note 7. Property, plant & equipment

Property, plant, & equipment are stated at cost, less accumulated depreciation
and any impairment in value. The carrying values are reviewed for impairment
when events or changes in circumstances indicate the carrying value may not be
recoverable. Impairment losses are recognized in the income statement.

Below is the table of Property, Plant and Equipment as at September 30, 2009:
<TABLE>
<CAPTION>
<S>     <C>

Total                           Plant and Machinery    Vehicles     Office Equipment    Total

Cost                                    788,111         445,518          34,733       1,268,362
Accumulated Depreciation               (266,440)       (140,894)         (8,838)       (416,172)
-----------------------------------------------------------------------------------------------
Net Carrying Value                      521,671         304,624          25,895         852,190
===============================================================================================
</TABLE>

Included in property and equipment is approximately $70,562 of assets, which are
leased under non-cancelable leases and accounted for as capital leases, which
expire through September 2011. The accumulated depreciation included in the
property and equipment for these leases is approximately $36,590.

Below is the table of Property, Plant and Equipment for the fiscal year ended
2008:

<TABLE>
<CAPTION>
<S>     <C>
Total                           Plant and Machinery    Vehicles     Office Equipment    Total

Cost                                     749,355         383,759          24,589       1,157,703
Accumulated Depreciation                (143,029)        (83,582)         (4,048)       (230,659)
------------------------------------------------------------------------------------------------
Net Carrying Value                       606,326         300,177          20,541         927,044
================================================================================================
</TABLE>


                                       10
<PAGE>

Included in property and equipment is approximately $55,833 of assets, which are
leased under non-cancelable leases and accounted for as capital leases, which
expire through September 2011. The accumulated depreciation included in the
property and equipment for these leases is approximately $21,960.

Depreciation and amortization expense for the Nine months period ended
September, 2009 and 2008 was $145,268 and $89,699, respectively.

Note 8.  Due to related parties

The amount due to related parties comprised of loan from Mr.Jack Chen, CEO, Mr.
David Chen, former CEO and major shareholder, and Jimmy Yiu, independent
director of the Company.

Included in the amount due to related parties, there were loans due to Mr. David
Chen of $1,886 and loans due to Mr. Jimmy Yiu, independent director of the
Company, amounting of $5,021 and loans due to Mr. Jack Chen of $384,848 (net)
without interest, unsecured and due on demand.

The shareholder's loan of Mr. Jack Chen included amount due from him of $15,000
and amount due to him of $399,848. We combined these two amounts and result in
loans due to Mr. Jack Chen of $384,848. The offsetting amounts due to and due
from Mr. Jack Chen are appropriate and comply with FASB Interpretation No.
39(ASC 210).

Note 9.  Stockholders equity

On October 15, 2007, the Company entered into a ten years service agreement with
Lyons Capital LLC. In connection with this agreement, Lyons Capital LLC will
receive 300,000 shares of Restricted, RULE 144 Stock, for services rendered or
to be rendered in the future. The Company issued shares on March 10, 2008 and
recorded at the fair market value of $156,000. This amount will be amortized
over a period of ten years from January 01, 2008. For the nine month period
ended September 30, 2009, the Company recorded $11,700 in consulting expense.
The unamortized amount of $128,700 is included under deferred compensation as at
September 30, 2009.

On May 15, 2008, the Company entered in a one year service agreement with
CEOcast, Inc to provide investor relations services. In connection with this
agreement, CEOcast will receive total 600,000 shares of Restricted, RULE 144
Stock. On August 1 and September 30, 2008, the Company issued 300,000 shares to
CEOcast separately and recorded at the fair market value of $144,000. This
amount will be amortized over a period of twelve months. As of December 31,
2008, the Company recorded $90,000 in consulting expense. The unamortized amount
of $54,000 is included under deferred compensation as at December 31, 2008. As
of September 30, 2009, the Company recorded $54,000 in consulting expense. There
is no unamortized amount under deferred compensation as of September 30, 2009.

On January 01, 2008, the Company entered in a four years employment agreement
with Mr. Jack Chen, current CEO. In connection with this agreement, Mr. Jack
Chen will receive corporate salary of $90,000 per year that paid in stock. On
August 01, 2008 and April 13, 2009, the Company issued 250,000 shares and
350,000 shares of Restricted, RULE 144 Stock to Mr. Jack Chen. The shares
recorded at the fair market value of $37,500 and $52,500 respectively. As of the
September 30, 2009, the Company recorded $67,500 in due to related parties.

Note 10. Segmental information

Statement of Financial Accounting Standards No. 131 ("SFAS 131"),(ASC 250)
"Disclosure About Segments of an Enterprise and Related Information" requires
use of the "management approach" model for segment reporting. The management
approach model is based on the way a company's management organizes segments
within the company for making operating decisions and assessing performance.
Reportable segments are based on products and services, geography, legal
structure, management structure, or any other manner in which management
disaggregates a company.

During the nine months periods ended September 30, 2009 and 2008, the Company is
organized into two business segments: (1) material recycling, (2) waste service.
The following table presents a summary of operating information and certain
quarter-end balance sheet information for the nine month period ended September
30, 2009 and 2008:


                                       11
<PAGE>


                                 FOR THE NINE MONTHS PERIODS ENDED SEPTEMBER 30,
                                            2009                        2008
Revenues from various areas:

         Material Recycling           $       1,541,322              2,033,622
         Waste Service                        6,608,222              5,961,561
                                      -----------------      -----------------
                     Consolidated     $       8,149,544      $       7,995,183
                                      =================      =================

Net income (loss):
         Material Recycling           $          35,052                188,386
         Waste Service                        1,711,486              1,474,605
         Un-allocted                           (135,084)              (215,668)
                                      -----------------      -----------------
                     Consolidated     $       1,611,454      $       1,447,323
                                      =================      =================

Identifiable assets:                                         December 31, 2008

         Material Recycling           $       1,014,933      $         761,133
         Material Trade                                                157,022
         Waste Service                        4,810,310              2,970,350
         Un-allocted                              1,298                 11,513
                                      -----------------      -----------------
                     Consolidated     $       5,826,541      $       3,900,018
                                      =================      =================

Depreciation and amortization:
         Material Recycling           $          75,101      $          44,403
         Waste Service                           70,167                 45,296
                                      -----------------      -----------------
                     Consolidated     $         145,268      $          89,699
                                      =================      =================

Capital expenditures:
         Material Recycling           $         186,239      $          28,521
         Waste Service                           99,290                128,083
                                      -----------------      -----------------
                     Consolidated     $         285,529      $         156,604
                                      =================      =================


Note 11. Major Customers and Vendors

Pernod Ricard, Hing Yang Hong and Yuewu, our three top customers, provided 73%
of net revenue for the nine months period ended September 30, 2009 respectively.
Total accounts receivable due from these customers was approximately $659,557 as
of September 30, 2009.

Normally, the payment terms of our accounts receivable is about one month and
will not be more than two months.

Shuizhou Jiangnan, Aperio Group and Astron are our major vendors. Total accounts
payable due to these vendors was $739,770 as of September 30, 2009.


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Item 2(a). Discussion for the Interim Operations and Financial Condition

Introduction


                                       12
<PAGE>

Management's discussion and analysis of results of operations and financial
condition ("MD&A") is provided as a supplement to the accompanying financial
statements and footnotes to help provide an understanding of our financial
condition, changes in financial condition and results of operations. The MD&A is
organized as follows:

o        Caution concerning forward-looking statements and risk factors. This
         section discusses how certain forward-looking statements made by us
         throughout the MD&A and in the financial statements are based on our
         present expectations about future events and are inherently susceptible
         to uncertainty and changes in circumstances.
o        Overview. This section provides a general description of our business,
         as well as recent developments that we believe are important in
         understanding the results of operations and to anticipate future trends
         in those operations.
o        Results of operations. This section provides an analysis of our results
         of operations for the three months and nine months period ended
         September 30, 2009 compared to the same period in 2008. A brief
         description is provided of transactions and events, including any
         related party transactions that affect the comparability of the results
         being analyzed.
o        Liquidity and capital resources. This section provides an analysis of
         our financial condition and cash flows for the nine months period ended
         September 30, 2009 and 2008.
o        Critical accounting policies. This section provides an analysis of the
         significant estimates and judgments that affect the reported amounts of
         assets, liabilities, revenues and expenses, and related disclosure of
         contingent assets and liabilities.

Caution Concerning Forward-looking Statements and Risk Factors

We have sought to identify what we believe to be the most significant risks to
our business, but we cannot predict whether, or to what extent, any of such
risks may be realized nor can we guarantee that we have identified all possible
risks that might arise. Investors should carefully consider all of such risk
factors before making an investment decision with respect to our Common Stock.

The following discussion should be read in conjunction with our financial
statements and the notes thereto, and the other financial information appearing
elsewhere in this document. In addition to historical information, the following
discussion and other parts of this document contain certain forward-looking
information. When used in this discussion, the words "believes", "anticipates",
"expects", and similar expressions are intended to identify forward-looking
statements. Such statements are subject to certain risks and uncertainties,
which could cause actual results to differ materially from projected results,
due to a number of factors beyond our control. We do not undertake to publicly
update or revise any of our forward-looking statements, even if experience or
future changes show that the indicated results or events will not be realized.
Readers are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date hereof. Readers are also urged to
carefully review and consider our discussions regarding the various factors,
which affect our business, included in this section and elsewhere in this
report.

Factors that might cause actual results, performance or achievements to differ
materially from those projected or implied in such forward-looking statements
include, among other things: (i) the impact of competitive products; (ii)
changes in law and regulations; (iii) limitations on future financing; (iv)
increases in the cost of borrowings and unavailability of debt or equity
capital; (v) our inability to gain and/or hold market share; (vi) managing and
maintaining growth; (vii) customer demands; (viii) market and industry
conditions, (ix) the success of product development and new product
introductions into the marketplace; (x) the departure of key members of
management; as well as other risks and uncertainties that are described from
time to time in our filings with the Securities and Exchange Commission.

We provide the following cautionary discussion of risks, uncertainties and
possible inaccurate assumptions relevant to our business and our products. These
are factors that we think could cause our actual results to differ materially
from expected results. Other factors besides those listed here could adversely
affect us.

Potential Fluctuations In Periodic Operating Results

Our periodic operating results may fluctuate significantly in the future as a
result of a variety of factors, most of which are outside our control,
including: the demand for our products; seasonal trends in purchasing, the
amount and timing of capital expenditures and other costs relating to the
development of our products; price competition or pricing changes in the
industry; technical difficulties or system downtime; general economic
conditions, and economic conditions specific to the industry. Our results may
also be significantly impacted by the impact of the accounting treatment of
acquisitions, financing transactions or other matters. Particularly at our early
stage of development, such accounting treatment can have a material impact on
the results for any period. Due to the foregoing factors, among others, it is
likely that our operating results will fall below our expectations or those of
investors in some future period.

Dependence Upon Management

Our future performance and success is dependant upon the efforts and abilities
of our Management. To a very significant degree, we are dependent upon the
continued services of Jack Chen, CEO & Director of the Company. If the Company
lost the services of Mr. Chen, or other key employees before we could get
qualified replacements that loss could materially adversely affect our business.
We do not maintain key man life insurance on any of our Management.


                                       13
<PAGE>

Limitation of Liability and Indemnification of Officers and Directors

Our officers and directors are required to exercise good faith and high
integrity in our Management affairs. Our Articles of Incorporation provide,
however, that our officers and directors shall have no liability to our
shareholders for losses sustained or liabilities incurred which arise from any
transaction in their respective managerial capacities unless they violated their
duty of loyalty, did not act in good faith, engaged in intentional misconduct or
knowingly violated the law, approved an improper dividend or stock repurchase,
or derived an improper benefit from the transaction. Our Articles and By-Laws
also provide for the indemnification by us of the officers and directors against
any losses or liabilities they may incur as a result of the manner in which they
operate our business or conduct the internal affairs, provided that in
connection with these activities they act in good faith and in a manner that
they reasonably believe to be in, or not opposed to, the best interests of the
Company, and their conduct does not constitute gross negligence, misconduct or
breach of fiduciary obligations. To further implement the permitted
indemnification, we have entered into Indemnity Agreements with our officers and
directors.

Management of Potential Growth

We anticipate rapid growth, which will place a significant strain on our
managerial, operational, and financial systems resources. To accommodate our
current size and manage growth, we must continue to implement and improve our
financial strength and our operational systems, and expand, train and manage our
sales and distribution base. There is no guarantee that we will be able to
effectively manage the expansion of our operations, or that our facilities,
systems, procedures or controls will be adequate to support our expanded
operations. Our inability to effectively manage our future growth would have a
material adverse effect on the Company.

Limited Market Due To Penny Stock

The Company's stock differs from many stocks, in that it is a "penny stock". The
Securities and Exchange Commission has adopted a number of rules to regulate
"penny stock". These rules include, but are not limited to, Rules 3a5l-l, 15g-1,
15g-2, 15g-3, 15g-4, 15g-5, 15g-6 and 15g-7 under the Securities and Exchange
Act of 1934, as amended. Because our securities probably constitute "penny
stock" within the meaning of the rules, the rules would apply to us and our
securities. The rules may further affect the ability of owners of our stock to
sell their securities in any market that may develop for them. There may be a
limited market for penny stocks, due to the regulatory burdens on
broker-dealers. The market among dealers may not be active. Investors in penny
stock often are unable to sell stock back to the dealer that sold them the
stock. The mark-ups or commissions charged by the broker-dealers may be greater
than any profit a seller may make. Because of large dealer spreads, investors
may be unable to sell the stock immediately back to the dealer at the same price
the dealer sold the stock to the investor. In some cases, the stock may fall
quickly in value. Investors may be unable to reap any profit from any sale of
the stock, if they can sell it at all. Stockholders should be aware that,
according to the Securities and Exchange Commission Release No. 34- 29093, the
market for penny stocks has suffered in recent years from patterns of fraud and
abuse. These patterns include: - Control of the market for the security by one
or a few broker-dealers that are often related to the promoter or issuer; -
Manipulation of prices through prearranged matching of purchases and sales and
false and misleading press releases; - "Boiler room" practices involving high
pressure sales tactics and unrealistic price projections by inexperienced sales
persons; - Excessive and undisclosed bid-ask differentials and markups by
selling broker-dealers; and - The wholesale dumping of the same securities by
promoters and broker- dealers after prices have been manipulated to a desired
level, along with the inevitable collapse of those prices with consequent
investor losses. Furthermore, the "penny stock" designation may adversely affect
the development of any public market for the Company's shares of common stock
or, if such a market develops, its continuation. Broker-dealers are required to
personally determine whether an investment in "penny stock" is suitable for
customers. Penny stocks are securities (i) with a price of less than five
dollars per share; (ii) that are not traded on a "recognized" national exchange;
(iii) whose prices are not quoted on the NASDAQ automated quotation system
(NASDAQ-listed stocks must still meet requirement (i) above); or (iv) of an
issuer with net tangible assets less than $2,000,000 (if the issuer has been in
continuous operation for at least three years) or $5,000,000 (if in continuous
operation for less than three years), or with average annual revenues of less
than $6,000,000 for the last three years. Section 15(g) of the Exchange Act and
Rule 15g-2 of the Commission require broker-dealers dealing in penny stocks to
provide potential investors with a document disclosing the risks of penny stocks
and to obtain a manually signed and dated written receipt of the document before
effecting any transaction in a penny stock for the investor`s account. Potential
investors in the Company`s common stock are urged to obtain and read such
disclosure carefully before purchasing any shares that are deemed to be "penny
stock". Rule 15g-9 of the Commission requires broker-dealers in penny stocks to
approve the account of any investor for transactions in such stocks before
selling any penny stock to that investor. This procedure requires the
broker-dealer to (i) obtain from the investor information concerning his or her
financial situation, investment experience and investment objectives; (ii)
reasonably determine, based on that information, that transactions in penny
stocks are suitable for the investor and that the investor has sufficient
knowledge and experience as to be reasonably capable of evaluating the risks of
penny stock transactions; (iii) provide the investor with a written statement
setting forth the basis on which the broker-dealer made the determination in
(ii) above; and (iv) receive a signed and dated copy of such statement from the
investor, confirming that it accurately reflects the investor's financial
situation, investment experience and investment objectives. Compliance with
these requirements may make it more difficult for the Company's stockholders to
resell their shares to third parties or to otherwise dispose of them.


                                       14
<PAGE>

Overview of the Company and its Operations

Sancon Resources Recovery, Inc. is an environmental service and waste management
company that operates recycling facilities in China and Australia. Sancon
specializes in the collection and recovery of industrial and commercial solid
wastes such as plastic, paper, cardboard, and glass. The recycled materials are
re-used by Sancon's manufacturing customers in China to make a wide variety of
new products including outdoor furniture, construction materials, building
materials, road surface, and various new products. Sancon's China operation is
licensed by the Chinese government for waste management services, and is
certified with ISO 9001 and ISO14001 standards. Sancon currently ships more than
25,000 tons of recycled industrial and commercial waste material annually to its
customers in China. Sancon's main operations and services include industrial
waste management consulting, collection and reprocess of recyclable materials
such as plastic, glass, cardboard, and paper before its re-entry into
manufacture cycles as raw materials. Sancon also provides its full waste
management services to large consumer products maker such as Pernod Ricard. The
use of recycled material is both environmentally friendly and is a key part of
today's competitive manufacturing process to lower costs. As China gains global
manufacturing dominance and current economic crisis, Chinese manufacturers are
increasingly turning to recycled materials to lower its costs, resulting
tremendous demand for recycled materials import. The major customers for Sancon
are Chinese manufacturers and recycled material traders which are located mainly
in the Chinese provinces of Guangdong, Zhejiang and Fujian.

THE TREND IN CHINESE MARKET

According to China National Resources Recycling Association, recyclable solid
waste import to China has experienced a dramatic increase in the last 2 decades.
During early 1990's, China imported 1-2 million tons of recyclable wastes per
year. By 1999, China imported 10 million tons of recyclable solid wastes per
year. In 2006 China imported 37 million tons of recyclable wastes. China's
total domestic recycled volume is estimated to have reached over 50 million tons
in 2007, with an estimated total worth of US$6 billion.

The State Development and Reform Commission of China promotes the recycling
industry with a four-pronged solution ranging from energy saving and clean
production to integrated use of resources and developing environmental
protection industry, to accelerate the development of the recycling economy. The
concept of recycling economy is included in the 11th Five-year Plan.

The Chinese Government is emphasizing environmental policies & projects for all
sectors and entities. On August 2008, China's top legislature passed a law to
promote circular economy and will come into force on January 1, 2009. The aim of
the law is to boost sustainable development through energy saving and reduction
of pollutant discharges. At present China's environmental industry is highly
fragmented and at its infancy stage.

Due to the serious environment pollution problems faced in China, the 11th
Five-year plan emphasis energy saving, emission reduction and environmental
protection at the highest level ever. At the end of the 11th Five-year plan, the
annual production of the environmental industry will exceed 1.1 trillion RMB, of
which environmental equipment spending is 120 billion RMB, environmental
services is 100 billion RMB, resources recovery is 660 billion RMB, cleaning
products spending is 250 billion RMB.

In the past 30 years of development, environmental production value in China
increased from 0.5% of GDP to the current 1.6%. China will expedite the
demonstration and promotion of technologies for energy saving and emission
reduction; actively promote the development of the environmental services
industry; and also intensify the financial services for the environmental
industry; and tax benefit policies for the environmental industry. During the
11th Five-year period, investment for environmental protection will reach 1.4
trillion RMB. Central government financing is investing in environmental
industry at annual compound growth rate of 18%. Chinese government set out
policies supports 4 key areas: developing a resources recovery and recycling
economy; pollution reduction and ecological protection; environment testing
instruments; environmental services and the development of the environmental
industry.

Sancon is uniquely position to benefits from these initiatives as an early mover
in the industry and one of the few foreign companies being awarded a waste
management license in China. Sancon has for the past years developed one of the
largest collection and recovery network in China for commercial wastes and
expects to expand into other areas of environmental services.

SANCON'S VISIONS AND GOALS

The long-term objective of Sancon is to seek and develop further alternative
resources recovery solutions, which will protect our environment and maximize
sustainable usage for industrial waste materials. At Sancon we believe reducing
the environmendal impact of manufactured products is through both professional
services offered to manufacturers and commercial entities to increase
recyclability of waste materials, and efficient redeployment of waste materials.

SERVICES OFFERED TO OUR CLIENTS

Sancon strives to take an all-inclusive approach to provide eco-friendly
solutions leading to the sustainable use of waste materials. Our services
include collection from manufacturing and commercial sites; re-process waste
materials to increase recyclability, end-of-life disassembly, redeployment of
recyclable materials, and destruction of sensitive materials and products.


                                       15
<PAGE>

COMPETITION

The markets for the Company's products and services are competitive, and the
Company faces competition from a number of sources. Many of the Company's
competitors have substantially greater resources than the Company. Those
resources may include greater name recognition; larger product lines;
complementary lines of business; and greater financial, marketing, information
systems, and other resources. The Company can give no assurance competitive
pressures will not materially and adversely affect the Company's business,
financial condition, and results of operations.

But the management has identified several key points which will give Sancon the
competitive edge in the market place:

1)       Sancon offers large selection of plastic and glass raw materials to our
         customers.

2)       With the expansion of our operations in Melbourne Australia, Sancon
         will be able to serve greater number of customers and sell direct to
         our customs in both Australia and China.

3)       Sancon has 6 strategically positioned recycling plants and about 40
         depots in China and it will enable Sancon to meet the demand for
         nationwide environmental services.

4)       Industry know-how and management team's ability to ensure all operating
         and environmental standards are achieved. Our team's experience in
         logistic management and waste management operations are key factors
         enabling the delivery of a high standard of service to Sancon's
         clients.

EMPLOYEES

As of September 30, 2009, the Company employed 15 people in Australia
subsidiaries. Our joint venture in China employed 20 people full time, and all
other personnel of the China joint venture are employed as sub contractors.
 To make our work more efficient, we outsourced a few other functions, such as
logistics, bookkeeping and administration, to certain professional firms to
enable our resource being focused on sales and processing functions.

FACTORS THAT MAY AFFECT FUTURE RESULTS

The business in which the Company is engaged is capital supportive. Accordingly,
the Company's ability to execute its business strategy and to sustain its
operations depends upon its ability to maintain or procure capital. There can be
no absolute assurance the necessary amount of capital will continue to be
available to the Company on favorable terms, or at all. The Company's inability
to obtain sufficient capital or to renew its credit facilities would limit the
Company's ability to: (i) add new equipment to its portfolio, (ii) fund its
working capital needs, and (iii) finance possible future acquisitions. The
Company's access to capital may have a material adverse effect on the Company's
business, financial condition and/or results of operations.

There can be no absolute assurance the Company will be able to effectively
manage its existing or the possible future expansion of its operations, or the
Company's systems, procedures or controls will be adequate to support the
Company's operations. Consequently, the Company's business, financial condition
and/or results of operations could be possibly and adversely affected.

The Company does not foresee changes in tax laws for the jurisdictions in which
the Company and its subsidiaries operate. There can be no absolute assurance
that changes will not occur, and therefore no absolute assurance such changes
will not materially and adversely affect the Company's business, financial
condition and results of operations.

As a public company, Sancon is subject to certain regulatory requirements
including, but not limited to, compliance with Section 404 of the Sarbanes-Oxley
Act of 2002 ("SOX404"). Such compliance results in significant additional costs
to the Company by increased audit and consulting fees, and the time required by
management to address the regulations. The SEC has recently delayed the
implementation date of SOX404 for non-accelerated filers until the fiscal year
ended December 31, 2009. However, should the Company successfully fulfill its
plans to procure financing and expand its operations; the Company may come under
the accelerated filer definition, and be required to comply with SOX404 before
June 15, 2010. In any case, such cocts will likely affect adversely the
Company's business, financial condition and results of operations.

Results of Operations - Comparison between the three and nine months ended
September 30, 2009 and the same periods in 2008.

Sales

Sales are generated by service charges and the sale of recyclable materials. The
sales for the three months period ended September 30, 2009 were $2,811,917,
representing $190,880 or 6% decrease compared to the sales of $3,002,797 in the
same period of 2008. Sales in the waste service business decreased from
$2,311,118 for the three months period ended September 30, 2008 to $2,188,996
for the three months period ended September 30, 2009, a decrease of $122,122 or
5%. Our waste service business expanded rapidly in the third quarter of 2008.
That is due to our effort in the market exploring. It went down slightly from
the fourth quarter of 2008 and maintained about $2,200,000 every quarter until
now. Sales in the material recycling business also decreased. It was $691,679

                                       16
<PAGE>

for the three months period ended September 30, 2008, however, this number went
down to $622,921 for the three months period ended September 30, 2009. It
decreased $68,758 or 10%. The decrese of sales in the material recycling
business was mainly due to the reduction of economic activities which caused by
the current economic crisis. But, compare to the decrease of 36% and 28% in the
first and the second quarter of 2009, this is considered a turn around
performance. Looking forward, Sancon will continue to generate better results in
the fourth quarter of 2009.

Sales for the nine months period ended September 30, 2009 were $8,149,544,
representing $154,361 or 2% increase compared to the sales of $7,995,183 in the
same period of 2008. Sales in the waste service business increased from
$5,961,561 for the nine months period ended September 30, 2008 to $6,608,222 for
the nine months period ended September 30, 2009, an increase of $646,661 or 11%.
In the year of 2008, Sales in the waste service business were not very good for
the first half year. Although it increased a lot in the third quarter, sales for
the nine months period ended September 30, 2008 still decreased compare to the
same period in the year of 2009. Sales in the material recycling business
decreased $492,300 or 24% from $2,033,622 for the nine months period ended
September 30, 2008 to $1,541,322 for the nine months period ended September 30,
2009. That is meanly because we are still suffering for the global economic
crisis in Australia. But things are getting better now.

Cost of Sales

Cost of sales is the direct cost for sale of the recycling materials. For the
three months period ended September 30, 2009, the cost of sales was $1,617,521.
It was $378,795 or 31% increase as compared to the cost of sales of $1,238,726
for the three months period ended September 30, 2008. Among which, the cost of
sales in the waste service business increased $487,962 or 56% from $863,711 for
the three months period ended September 30, 2008 to $1,351,673 for the three
months period ended September 30, 2009. The increase mainly contained $204,184
of shipping expenses and $111,956 of labor service fee for sub contractors. All
these costs were related to our market expandant and the change of shipping mode
that required by the customers. Cost of sales in the material recycling business
for the three months period ended September 30, 2008 and 2009 was $390,015 and
$265,848 respectively, a decrease of $124,167 or 32%. The decrease of cost of
sales in the material recycling business was in line with the sales.

For the three months period ended September 30, 2008 and 2009, cost of sales was
41% and 58% of sales respectively.

For the nine months period ended September 30, 2009, the cost of sales was
$4,224,110. It was $880,641 or 26% increase as compared to the cost of sales of
$3,343,469 for the nine months period ended September 30, 2008. Among which, the
cost of sales in the waste service business increased $1,096,853 or 44% from
$2,515,552 for the nine months period ended September 30, 2008 to $3,612,405 for
the nine months period ended September 30, 2009. The increase mainly contained
$753,019 of shipping expenses, $86,682 for worshop rental fee and $184,389 of
labor service fee for sub contractors. The increase in the costs were mainly due
to the market expandant and the change of shipping mode that required by
customers. Cost of revenue in the material recycling business for the nine
months period ended September 30, 2008 and 2009 was $820,417 and $611,705
respectively, a decrease of $208,712 or 25%.

For the nine months period ended September 30, 2008 and 2009, cost of sales was
42% and 52% of sales respectively.

Gross profit

The gross profit for the three months period ended September 30, 2009 was
$1,194,396, representing $569,675 or 32% decrease compared to $1,764,071 for the
three months period ended September 30, 2008. The gross margin reduced from 59%
for the three months period ended September 30, 2008 to 42% for the three months
period ended September 30, 2009. The decrease of the gross profit is mainly due
to it's reduce in the waste service business of $610,084 or 42%. The decrease in
sales and the increase in cost of sales lead to the deline of gross profit in
the waste service business. The gross profit in the material recycling business
increased $55,409 or 18% from $301,664 for the three months period ended
September 30, 2008 to $357,073 for the same period in 2009.

The gross profit for the nine months period ended September 30, 2009 was
$3,925,434, representing $726,280 or 16% decrease compared to $4,651,714 for the
nine months period ended September 30, 2008. The gross margin reduced from 58%
for the nine months period ended September 30, 2008 to 48% for the nine months
period ended September 30, 2009. The decrease of the gross profit is due to it's
reduce in the waste service business of $450,192 or 13% and in the material
recycling business of $283,588 or 23%.

Selling, general and administrative expenses

Selling, general and administrative expenses decreased to $588,521 for the three
months period ended September 30, 2009, from $1,461,943 for the three months
period ended September 30, 2008, a decrease of $873,422 or 60%. The SG&A
expenses in the waste service business was $1,182,078 for the three months
period ended September 30, 2008, this number decreased to $247,001 for the three
months period ended September 30, 2009. It decreased $935,077 or 79%. The
decrease was mainly contained $877,140 of consulting fee and $40,566 of
travelling. The high consulting fee and travelling fee paid during the three
month ended September 30, 2008 were related to the market devepoping. From the
beginning of this year, these kinds of expenses were reduced gradrully. The SG&A
expenses in the material recycling business increased $52,727 or 20% from
$262,393 for the three months period ended September 30, 2008 to $315,120 for
the three months period ended September 30, 2009. The increase was mainly due to
the rise of freight charge and accounting fee.The SG&A expenses also included

                                       17
<PAGE>

investor relationship expenses which increased $8,928 or 51% from $17,472 for
the three months period ended September 30, 2008 to $26,400 for the three months
period ended September 30, 2009.

The SG&A expenses was 21% of the sales for the three months period ended
September 30, 2009 while it was 49% for the three months period ended September
30, 2008.

Selling, general and administrative expenses decreased to $2,108,126 for the
nine months period ended September 30, 2009, from $2,949,104 for the nine months
period ended September 30, 2008, a decrease of $840,978 or 29%. The SG&A
expenses in the waste service business was $1,869,634 for the nine months period
ended September 30, 2008, this number decreased to $1,161,356 for the nine
months period ended September 30, 2009. It decreased $708,278 or 38%. The
decrease was mainly contained $736,868 of consulting fee. In order to control
the cost, the company reduced consulting fee greatly for the nine months period
ended September 30, 2009. The SG&A expenses in the material recycling business
decreased $178,728 or 18% from $992,298 for the nine months period ended
September 30, 2008 to $813,570 for the nine months period ended September 30,
2009. The SG&A expenses also included investor relationship expenses which
increased $46,028 or 53% from $87,172 for the nine months period ended September
30, 2008 to $133,200 for the nine months period ended September 30, 2009.

The SG&A expenses was 26% of the sales for the nine months period ended
September 30, 2009 while it was 37% for the nine months period ended September
30, 2008.

Depreciation Expense

Depreciation expense increased to $54,958 for the three months period ended
September 30, 2009 from $11,493 for the three months period ended September 30,
2008. It increased $43,465 or 378%. The increases were mainly due to the
purchase of plant and machinery. The depreciation expense in the waste service
business increased $16,053 or 138% from $11,657 for the three months period
ended September 30, 2008 to $27,710 for the three months period ended September
30, 2009. The depreciation expense in the material recycling business increased
$27,412.

For the three months period ended September 30, 2008 and 2009, depreciation
expense was 0.4% and 2% of the sales respectively.

Depreciation expense increased to $145,268 for the nine months period ended
September 30, 2009 from $89,699 for the nine months period ended September 30,
2008. It increased $55,569 or 62%. The depreciation expense in the waste service
business increased $24,871 or 55% from $45,296 for the nine months period ended
September 30, 2008 to $70,167 for the nine months period ended September 30,
2009. The depreciation expense in the material recycling business increased
$30,698 or 69%.

For the nine months period ended September 30, 2008 and 2009, depreciation
expense was 1% and 2% of the sales respectively.

Other Income (Expense)

For the three months period ended September 30, 2009, the Company booked other
expense of $40,361 compared to $69,600 for the three months period ended
September 30, 2008. The decrease was $29,239 or 42%.

For the three months period ended September 30, 2009, other expense was 1% of
the sales whie it was 2% for the three months period ended September 30, 2008.

For the nine months period ended September 30, 2009, the Company booked other
expense of $1,297 compared to $43,939 for the nine months period ended September
30, 2008. The decrease was $42,642 or 97%.

For the nine months period ended September 30, 2009 and 2008, other income was
0.02% and 0.5% of the sales respectively.

Non-Controlling interest in subsidiary
On August 15, 2007, the Company completed the acquisition of 70% of the equity
interest in Sancon Resources Recovery (Shanghai) Co., Ltd by exercising its
option to convert $200,000 of convertible promissory note. Net income of $5,196
& net loss of $109,952 was attributable to Non-Controlling interest for the
three months period ended September 30, 2009 & 2008 respectively. For the three
months period ended September 30, 2009 & 2008, non-controlling interest was 0.2%
and 4% of the sales respectively.

Non-controlling interest was $42,038 for the nine months period ended September
30, 2008 while it was $20,045 for the nine months period ended September 30,
2009. For the nine months period ended September 30, 2008 and 2009,
non-controlling interest was 1% and 0.2% of the sales respectively.


                                       18
<PAGE>

Discontinued Operation

On March 31, 2009, the company sold 100% equity interest of Guang Cheng Int'l
Trading Ltd. ("Guang Cheng") for $1,290 plus the assumption of certain
liabilities.

There was no discontinued operation for the three months period ended September
30, 2009. During the same period in 2008, gain on discontinued operation was
$3,155.

Loss on discontinued operation was $1,884 for the nine months period ended
September 30, 2009 while it was $33,246 for the nine months period ended
September 30, 2008.

Income Tax

The income tax increased to $1,348 for the three months period ended September
30, 2009 from minus $122,167 for the three months period ended September 30,
2008, an increase of $123,515 or 101%. For the three months period ended
September, 2008 and 2009, income tax was 4% and 0.05% of the sales respectively.

The income tax decreased to $37,360 for the nine months period ended September
30, 2009 from $46,365 for the nine months period ended September 30, 2008, a
decrease of $9,005 or 19%. For the nine months period ended September 30, 2008
and 2009, income tax was 1% and 0.5% of the sales respectively.

Net loss/income

Net income for the three months period ended September 30, 2009 was $504,012,
compared to $456,309 for the three months period ended September 30, 2008, an
increase of $47,703 or 10%. The increase is mainly due to the increase of net
income in the waste service business of $46,010 or 9% and head office of $55,850
or 68% although net income in the material recycling business decreased $51,003
or 126%. Although the sales and gross profit decreased for the three months
period ended September 30, 2009, the significant decrease in SG&A expenses in
the waste service business lead to the increase in net income. Net profit margin
for the three months period ended September 30, 2009 was 18% while it was 15%
for the same period in 2008.

Net income for the nine months period ended September 30, 2009 was $1,611,454,
compared to $1,447,323 for the nine months period ended September 30, 2008, an
increase of $164,131 or 11%. The increase is mainly due to the significant
increase of net income in the waste service business of $236,881 or 16% and head
office of $49,222 or 27% although net income in the material recycling business
decreased $153,334 or 81%. The dramatic decrese in SG&A expenses in the waste
service business was the main reason for the increase of net income. Net profit
margin for the nine months period ended September 30, 2009 was 20% while it was
18% for the same period in 2008.

Liquidity and Capital Resources

As shown in the accompanying financial statements, the Company has accumulated
profit of $2,979,409 as of September 30, 2009 compared to $1,367,955 as of
December 31, 2008. In addition, we have positive working capital $2,867,277 as
of September 30, 2009 and it was $1,160,747 as of December 31, 2008. It
increased $1,706,530. That is mainly due to the increase of $1,030,013 in cash
and cash equivalents and $688,307 in the trade receivables. The strong sales for
the nine months period ended September 30, 2009 lead to the great increase in
cash and trade receivable.

Operating Activities

The net cash provided by operating activities for the nine months period ended
September 30, 2009 amounted to $1,310,290 compared to $1,579,327 for the nine
months period ended September 30, 2008, and decrease of $269,037 or 17%. The
decrease mainly included trade receivables of $793,015. These decreases were
offset by other current assets of $141,510, trade payable of $154,043 .The
payment terms of our accounts receivable is about one month and will not be more
than two months.

Investing Activities

Net cash used in investing activities amounted to $174,519 for the nine months
period ended September 30, 2009 compared to $156,566 for the nine months period
ended September 30, 2008, an increase of $17,953 or 11%. It's mainly due to the
increase on purchase of property and equipment and long term investment. For the
nine months period ended September 30, 2008, the cash used in purchase of
property and equipment was $156,604, however, this number increased to $285,529
for the same period in 2009. During the nine months period ended September 30,
2009, the Company disposed equipment and received cash of $152,969. During the
nine months period ended September 30, 2009, the Company invested RMB 300,000 or
$44,010 to acquire 20% equity of Sheng Rong and had a loss of $197.


                                       19
<PAGE>

Financing Activities

Net cash used in financing activities amounted to $78,539 for the nine months
period ended September 30, 2009. For the nine months period ended September 30,
2008, net cash provided by financing activities was $28,749, a decrease of
$107,288 or 373%. The decrease mainly included shareholder's loan of $119,890.

The Company has financed its growth by utilizing cash reserves and loan from
directors. Loan from directors usually was unsecured, and no payment term and
without interest bearing. The Company's primary use of funds is for the purchase
of equipment for operation and the purchase of inventory.

Inflation

In the opinion of management, inflation has not had a material effect on the
Company's financial condition or results of its operations.

Trends and uncertainties

Management believes there are no known trends, events, or uncertainties that
could, or reasonably be expected to, adversely affect the Company's liquidity in
the short and long terms, or its net sales, revenues, or income from continuing
operations.

The Company's operations are not affected by seasonal factors.

Critical Accounting Policies and Estimates

The preparation of our consolidated financial statements in conformity with
accounting principles generally accepted in the United States requires us to
make estimates and judgments that affect our reported assets, liabilities,
revenues, and expenses, and the disclosure of contingent assets and liabilities.
We base our estimates and judgments on historical experience and on various
other assumptions we believe to be reasonable under the circumstances. Future
events, however, may differ markedly from our current expectations and
assumptions. While there are a number of significant accounting policies
affecting our consolidated financial statements; we believe the following
critical accounting policies involve the most complex, difficult and subjective
estimates and judgments: allowance for doubtful accounts; income taxes;
stock-based compensation; asset impairment.

ALLOWANCE FOR DOUBTFUL ACCOUNTS

We maintain an allowance for doubtful accounts to reduce amounts to their
estimated realizable value. A considerable amount of judgment is required when
we assess the realization of accounts receivables, including assessing the
probability of collection and the current credit-worthiness of each customer. If
the financial condition of our customers were to deteriorate, resulting in an
impairment of their ability to make payments, an additional provision for
doubtful accounts could be required. We initially record a provision for
doubtful accounts based on our historical experience, and then adjust this
provision at the end of each reporting period based on a detailed assessment of
our accounts receivable and allowance for doubtful accounts. In estimating the
provision for doubtful accounts, we consider: (i) the aging of the accounts
receivable; (ii) trends within and ratios involving the age of the accounts
receivable; (iii) the customer mix in each of the aging categories and the
nature of the receivable; (iv) our historical provision for doubtful accounts;
(v) the credit worthiness of the customer; and (vi) the economic conditions of
the customer's industry as well as general economic conditions, among other
factors.

INCOME TAXES

We account for income taxes in accordance with SFAS No. 109 (ASC 740),
Accounting for Income Taxes. SFAS 109 (ASC 740) prescribes the use of the
liability method. Under this method, deferred tax assets and liabilities are
recognized for the future tax consequences attributable to temporary differences
between the financial statement carrying amounts and the tax basis of assets and
liabilities. Deferred tax assets and liabilities are measured using the enacted
tax rates expected to apply to taxable income in the years in which those
temporary differences are expected to be recovered or settled. We then assess
the likelihood that our deferred tax assets will be recovered from future
taxable income and to the extent we believe that recovery is not likely, we
establish a valuation allowance. To the extent we establish a valuation
allowance, or increase or decrease this allowance in a period, we increase or
decrease our income tax provision in our statement of operations. If any of our
estimates of our prior period taxable income or loss prove to be incorrect,
material differences could impact the amount and timing of income tax benefits
or payments for any period. In addition, as a result of the significant change
in the Company's ownership, the Company's future use of its existing net
operating losses may be limited.

The Company operates in several countries. As a result, we are subject to
numerous domestic and foreign tax jurisdictions and tax agreements and treaties
among the various taxing authorities. Our operations in these jurisdictions are
taxed on various bases: income before taxes, deemed profits and withholding
taxes based on revenue. The calculation of our tax liabilities involves
consideration of uncertainties in the application and interpretation of complex
tax regulations in a multitude of jurisdictions across our global operations.


                                       20
<PAGE>

We recognize potential liabilities and record tax liabilities for anticipated
tax audit issues in the U.S. and other tax jurisdictions based on our estimate
of whether, and the extent to which, additional taxes will be due. The tax
liabilities are reflected net of realized tax loss carry forwards. We adjust
these reserves upon specific events; however, due to the complexity of some of
these uncertainties, the ultimate resolution may result in a payment that is
different from our current estimate of the tax liabilities. If our estimate of
tax liabilities proves to be less than the ultimate assessment, an additional
charge to expense would result. If payment of these amounts ultimately proves to
be less than the recorded amounts, the reversal of the liabilities would result
in tax benefits being recognized in the period when the contingency has been
resolved and the liabilities are no longer necessary.

Changes in tax laws, regulations, agreements and treaties, foreign currency
exchange restrictions or our level of operations or profitability in each taxing
jurisdiction could have an impact upon the amount of income taxes that we
provide during any given year.

STOCK-BASED COMPENSATION

During December 2002, the FASB issued SFAS No. 148, "Accounting for Stock-Based
Compensation-Transition and Disclosure-an amendment of SFAS 123(ASC 718)". This
statement amends SFAS No. 123(ASC 718), "Accounting for Stock-Based
Compensation", to provide alternative methods of transition for a voluntary
change to the fair value based method of accounting for stock-based employee
compensation. In addition, this statement amends the disclosure requirements of
SFAS No. 123(ASC 718) to require prominent disclosures in both annual and
interim financial statements about the method of accounting for stock-based
employee compensation and the effect of the method used on reported results. The
Company has chosen to continue to account for stock-based compensation using the
intrinsic value method prescribed in APB Opinion No. 25 and related
interpretations. Accordingly, compensation expense for stock options is measured
as the excess, if any, of the fair market value of the Company's stock at the
date of the grant over the exercise price of the related option. The Company has
adopted the annual disclosure provisions of SFAS No. 148 in its financial
reports for the year ended December 31, 2005 and has adopted the interim
disclosure provisions in its financial reports for the subsequent periods.

Effective January 1, 2006, the beginning of Sancon's first fiscal quarter of
2006, the Company adopted the fair value recognition provisions of SFAS 123R(ASC
718), using the modified-prospective transition method. Under this transition
method, stock-based compensation expense was recognized in the consolidated
financial statements for granted stock options, since the related purchase
discounts exceeded the amount allowed under SFAS 123R(ASC 718) for
non-compensatory treatment. Compensation expense recognized included: the
estimated expense for stock options granted on and subsequent to January 1,
2006, based on the grant date fair value estimated in accordance with the
provisions of SFAS 123R; and the estimated expense for the portion vesting in
the period for options granted prior to, but not vested as of January 1, 2006,
based on the grant date fair value estimated in accordance with the original
provisions of SFAS 123(ASC 718). Results for prior periods have not been
restated, as provided for under the modified-prospective method.

As of September 30, 2009 and 2008, the Company did not issue or make provision
through the issuance of stock options to employees and directors.

For other items paid for by common stock, the value of the transaction is
determined by the value of the goods or services received, measured at the time
of the transaction. The corresponding stock value, used to determine the number
of share to be issued, is the value of the average price for the 20 to 30 days
prior to the transaction date.

ASSET IMPAIRMENT

We periodically evaluate the carrying value of other long-lived assets,
including, but not limited to, property and equipment and intangible assets,
when events and circumstances warrant such a review. The carrying value of a
long-lived asset is considered impaired when the anticipated undiscounted cash
flows from such asset is less than its carrying value. In that event, a loss is
recognized based on the amount by which the carrying value exceeds the fair
value of the long-lived asset. Fair value is determined primarily using the
anticipaded cash flows discounted at a rate commensurate with the risk involved.
Significant estimates are utilized to calculate expected future cash flows
utilized in impairment analyses. We also utilize judgment to determine other
factors within fair value analyses, including the applicable discount rate.

Item 2(b).  Off-Balance Sheet Arrangements

There are no off-balance sheet arrangements that have or are reasonably likely
to have a current or future effect on the Company's financial condition, changes
in financial condition, revenues or expenses, results of operations, liquidity,
capital expenditures or capital resources, that are material to investors.

ITEM 3.  CONTROLS AND PROCEDURES

Under the supervision and with the participation of our management, including
our principal executive officer and the principal financial officer, we
conducted an evaluation of the effectiveness of the design and operation of its
disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e)
under the Securities Exchange Act of 1934, as of the end of the period covered
by this report (the "Evaluation Date"). Based on this evaluation, our principal
executive officer and principal financial officer concluded as of the Evaluation
Date, that our disclosure controls and procedures were not effective.


                                       21
<PAGE>

During the three months ended September 30, 2009, there were no changes in our
internal accounting controls or in other factors that materially affected our
internal controls over financial reporting.

PART II.  OTHER INFORMATION

Item 1.  Unregistered Sales of Equity Securities and Use of Proceeds.

None

Item 2   Changes in Securities and Use of Proceeds

None

Item 3.  Defaults Upon Senior Securities.

None.

Item 4.  Submission of Matters to a Vote of Security Holders.

Matters for a vote of security holders were submitted to security holders in the
Company's Proxy Statement, filed upon December 6, 2005. The remainder of the
information required by this item is incorporated by reference to the Company's
Proxy Statement.

Item 5.  Other Information.

None.

                                       22
<PAGE>


Item 6.  Exhibits

The following list describes the exhibits filed as part of this Report on Form
10-Q.

<TABLE>
<CAPTION>
<S>     <C>

Exhibit                            Description of Document
Number     Note

3.1     (1)   Articles of Incorporation of Financial Telecom Limited (USA), Inc.
3.2     (1)   Amended and Restated Bylaws of Financial Telecom Limited (USA), Inc.
10.1    (1)   Agreement between Hong Kong Futures Exchange Limited and Financial Telecom Limited.
10.2    (1)   Market Service Datafeed Agreement between Stock Exchange  Information  Services Limited and Financial Telecom
              Limited.
10.3    (2)   Option  agreement  dated  December 14, 2004 between  Fintel Group Limited and  shareholders  of Shanghai Long
              terms Technology Limited.
10.4    (2)   Option  agreement  dated  January 5, 2005  between  Fintel  Group  Limited  and  shareholders  of Beijing JCL
              Technology Commerce Limited.
10.5    (2)   Option  agreement dated January 20, 2005 between Fintel Group Limited and  shareholders  of Shanghai  Qianhou
              Computer Technology Limited.
10.6    (2)   Independent contractor agreement between Fintel Group Limited and Mr. Sam Chong Keen.
10.7    (2)   Independent contractor agreement between Fintel Group Limited and Info Media Company.
10.8    (2)   Independent contractor agreement between Fintel Group Limited and China Digital Distribution Limited.
10.9    (3)   Sales and purchase  agreement  dated March 25, 2005 between  Fintel Group Limited and  shareholders  of Enjoy
              Media Holdings Limited.
10.10   (4)   Sales and purchase  agreement  dated April 25, 2005 between Fintel Group Limited and  shareholders of Beijing
              Genial Technology Co. Ltd.
10.11   (4)   Option  agreement dated March 7, 2005 between Fintel Group Limited and  shareholders  of Beijing  Sinoskyline
              technology Trading Co. Ltd.
14.1    (9)   Code of Ethics.
16.1    (7)   Change in Certifying Accountants.
16.2   (10)   Incorporated herein by reference to registrant's  Current Report on Form 8K/A (File No. 000-50760) filed July
              7, 2006.
17.1    (6)   Correspondence on departure of Directors.
20.1    (8)   Proxy Statement dated December 6, 2005.
21.1    (5)   Subsidiaries of the registrant.
24.1    (5)   Power of Attorney.
31.1    (5)   Certification of Chief Executive Officer,  pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
              302 of the Sarbanes-Oxley Act of 2002.
31.2    (5)   Certification of Chief Financial Officer,  pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
              302 of the Sarbanes-Oxley Act of 2002.
32.1    (5)   Certification  of Officers,  pursuant to 18 U.S.C.  Section 1350,  as adopted  pursuant to Section 906 of the
              Sarbanes-Oxley Act of 2002.
</TABLE>


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

(1)  Incorporated herein by reference to the registrant's initial Registration
     Statement on Form 10-SB (File No. 000-50760) filed on May 13, 2004.
(2)  Incorporated herein by reference to the registrant's Annual Report on Form
     10-KSB (File No. 000-50760) filed April 15, 2005.
(3)  Incorporated herein by reference to the registrant's Quarterly Report of
     Form 10-QSB (File No. 000-50760) filed May 6, 2005.
(4)  Incorporated herein by reference to the registrant's Quarterly Report of
     Form 10-QSB (File No. 000-50760) filed August 6, 2005.
(5)  Filed herewith.
(6)  Incorporated herein by reference to the registrant's Current Report on Form
     8K/A (File No. 000-50760) filed November 29, 2005.
(7)  Incorporated herein by reference to the registrant's Current Report on Form
     8K/A (File No. 000-50760) filed January 25, 2006. (8) Incorporated herein
     by reference to the registrant's Proxy Statement (File No. 000-50760) filed
     December 6, 2005.
(9)  Incorporated herein by reference to the registrant's Annual Report on Form
     10-KSB (File No. 000-50760) filed April 26, 2006. (10) Incorporated herein
     by reference to the registrant's Current Report on Form 8K/A (File No.
     000-50760) filed July 7, 2006.


                                       23
<PAGE>



SIGNATURES



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

                                                Sancon Resources Recovery, Inc.

Date: November 13, 2009
                                                              By: /s/ Jack Chen
                                                                  -------------
                                                                      Jack Chen
                                                        Chief Executive 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.

                                                Sancon Resources Recovery, Inc.

Date:  November 13, 2009
                                                             By: /s/ David Chen
                                                                 --------------
                                                                     David Chen
                                                                       Chairman

Date:  November 13, 2009
                                                             By:  /s/ Jimmy Yiu
                                                                  -------------
                                                                      Jimmy Yiu
                                                           Independent Director

Date:  November 13, 2009
                                                           By:  /s/ Cong Yuanli
                                                                ---------------
                                                                    Cong Yuanli
                                                           Independent Director

Date:  November 13, 2009
                                                             By:  /s/ Jack Chen
                                                                  -------------
                                                                     Jack. Chen
                                                                       Director


                                       24