================================================================================
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D. C. 20549

                                   FORM 10-QSB

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

                For the Quarterly Period Ended September 30, 2003

                                       OR

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

         For the transition Period from ______________ to ______________

                        Commission file number 000-24057

                         Rushmore Financial Group, Inc.
                         ------------------------------
             (Exact name of registrant as specified in its charter)

            Texas                                 75-2375969
            -----                                 ----------
   (State of Incorporation)          (I. R. S. Employer Identification No.)

                 13355 Noel Road, Suite 300, Dallas, Texas 75240
               ---------------------------------------------------
                                  972-450-6000
               ---------------------------------------------------
                (Issuer's telephone number, including area code)


         Check whether the issuer (1) filed all reports  required to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 12 months (or for such
shorter period that the  registrant was required to file such reports),  and (2)
has been subject to such filing requirements for the past 90 days.

                                 Yes XXX  No ____

         State the number of shares  outstanding of each of the issuer's classes
of common  equity as of September  30, 2003:  9,851,912  shares of common stock,
$0.01 par value.

         Transitional Small Business Disclosure Format;

                                 Yes ____ No XXX

<PAGE>

PART I.   FINANCIAL INFORMATION
Item 1.   Financial Statements























                                       2
<PAGE>
<TABLE>
<CAPTION>

                 RUSHMORE FINANCIAL GROUP, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS

                                                                                   (Unaudited)
                                                                                   September 30,   December 31,
                                    ASSETS                                              2003            2002
                                                                                   ------------    ------------
<S>                                                                                <C>             <C>

Cash and cash equivalents                                                          $    149,352    $     64,278
Accounts receivable                                                                      13,126          31,816
Other receivable                                                                         75,000            --
Prepaid expenses and deposits                                                           120,717         164,847
Capitalized software development costs, at cost, net of accumulated amortization      1,433,408       1,869,555
Property and equipment, net of accumulated depreciation                                  87,412         133,893
Intangibles, net                                                                        159,667          65,000
Deferred financing fees, net                                                             23,094          33,486
                                                                                   ------------    ------------
          Total assets                                                             $  2,061,776    $  2,362,875
                                                                                   ============    ============

                    LIABILITIES AND SHAREHOLDERS' DEFICIT

Liabilities:
     Bank overdraft                                                                $       --      $     37,750
     Accounts payable                                                                   729,667         757,134
     Accrued expenses and other liabilities                                             879,504         620,166
     Liabilities acquired in 2001 acquisition                                           332,098         332,098
     Advances from related parties                                                       65,000            --
     Notes payable                                                                       36,301          52,400
     Convertible notes payable (including $302,630 and $298,252 due to related
        parties at September 30, 2003 (unaudited) and December 31, 2002,
        respectively), net of unamortized debt discount of $18,818 and $50,968
        at September 30, 2003 (unaudited) and December 31, 2002, respectively           466,182         457,344
     Convertible bonds payable (including $330,500 and $300,000 due to related
        parties at September 30, 2003  (unaudited) and December 31, 2002,
        respectively), net of unamortized debt discount of $32,150 and $0 at
        September 30, 2003 (unaudited) and December 31, 2002, respectively            1,141,598         540,000
                                                                                   ------------    ------------
        Total liabilities                                                             3,650,350       2,796,892
                                                                                   ------------    ------------

Shareholders' deficit:
     Preferred stock - cumulative; $10 par value; 14,063 shares issued and
         outstanding                                                                    140,630         140,630
     Preferred stock - convertible cumulative; $10 par value;
         55,480 and 63,980 shares issued and outstanding at September 30, 2003
         (unaudited) and December 31, 2002, respectively                                554,800         639,800
     Common stock - $0.01 par value; 10,000,000 shares authorized;
         9,902,540 and 9,895,588 shares issued at September 30, 2003 (unaudited)
         and December 31, 2002 respectively                                              99,025          98,956
     Common stock subscriptions receivable                                               (3,277)         (3,277)
     Common stock pending issuance                                                      143,000            --
     Common stock issued for assets not yet received                                   (106,000)       (230,000)
     Additional paid in capital                                                      12,336,629      12,419,638
     Treasury stock, at cost - 50,628 and 196,878 shares at September 30, 2003
         (unaudited) and December 31, 2002, respectively                                (31,001)       (120,652)
     Accumulated deficit                                                            (14,722,380)    (13,379,112)
                                                                                   ------------    ------------
          Total shareholders' deficit                                                (1,588,574)       (434,017)
                                                                                   ------------    ------------
          Total liabilities and shareholders' deficit                              $  2,061,776    $  2,362,875
                                                                                   ============    ============

</TABLE>

           See accompanying notes to consolidated financial statements


                                       3
<PAGE>
<TABLE>
<CAPTION>

                 RUSHMORE FINANCIAL GROUP, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (unaudited)

                                               For the Three Months           For the Nine Months
                                                Ended September 30,           Ended September 30,
                                            --------------------------    --------------------------
                                                2003           2002           2003           2002
                                            -----------    -----------    -----------    -----------
<S>                                         <C>            <C>            <C>            <C>
 Revenue:
        Investment services                 $   366,928    $   421,376    $   815,131    $ 3,678,124

 Expenses:
        Investment services                     398,896        277,616        858,167      2,980,382
        General and administrative              197,084        316,197        832,425      1,686,019
        Depreciation and amortization           201,514        213,995        594,547        331,125
                                            -----------    -----------    -----------    -----------
                     Total expenses             797,494        807,808      2,285,139      4,997,526
                                            -----------    -----------    -----------    -----------

 Operating loss                                (430,566)      (386,432)    (1,470,008)    (1,319,402)

Other income (expense):
        Write off of impaired goodwill             --             --             --       (1,042,028)
        Gain from sale of certain assets        225,000           --          225,000           --
        Gain on settlement of liabilities        53,891           --           53,891           --
        Interest expense                        (61,534)       (12,719)      (152,151)       (36,189)
                                            -----------    -----------    -----------    -----------

 Net loss                                   $  (213,209)   $  (399,151)   $(1,343,268)   $(2,397,619)
                                            ===========    ===========    ===========    ===========


Basic and diluted net loss per share of
     common stock applicable to common
     shareholders                           $     (0.02)   $     (0.05)   $     (0.14)   $     (0.32)
                                            ===========    ===========    ===========    ===========

Weighted average common shares
     outstanding                              9,850,513      8,290,595      9,783,356      7,638,313
                                            ===========    ===========    ===========    ===========

</TABLE>





           See accompanying notes to consolidated financial statements


                                       4
<PAGE>
<TABLE>
<CAPTION>

                 RUSHMORE FINANCIAL GROUP, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
              For the Nine Months ended September 30, 2003 and 2002
                                   (unaudited)

                                                                      2003           2002
                                                                  -----------    -----------
<S>                                                               <C>            <C>
Cash flows from operating activities:
    Net loss                                                      $(1,343,268)   $(2,397,619)
    Adjustments to reconcile net loss to net cash used in
    operating activities:

         Common stock issued for compensation, services and
              expenses                                                 22,052         40,602
         Fair value of common stock options issued for services          --          167,491
         Write off of impaired goodwill                                  --        1,042,028
         Depreciation and amortization                                565,214        331,125
         Amortization of debt discount                                 10,201           --
         Amortization of intangible asset                              29,333           --
         Amortization of deferred financing fees                       10,392           --
         Gain on sale of certain assets                              (225,000)          --
         Gain on settlement of liabilities                            (53,891)          --
         Change in assets and liabilities:
             (Increase) decrease in assets:
                Accounts receivable                                    18,690        325,354
                Prepaid expenses and deposits                          44,130         88,510
              Increase (decrease) in liabilities:
                Accounts payable                                      (27,467)        67,611
                Accrued expenses and other liabilities                296,123         59,957
                                                                  -----------    -----------
Net cash used in operating activities                                (653,491)      (274,941)
                                                                  -----------    -----------

Cash flows from investing activities:
    Purchase of equipment                                                --          (25,011)
    Capitalization of software development costs                      (82,586)      (448,047)
    Proceeds from sale of certain assets                              150,000         79,464
                                                                  -----------    -----------
Net cash provided by (used in) investing activities                    67,414       (393,594)
                                                                  -----------    -----------

Cash flows from financing activities:
    Decrease in bank overdraft                                        (37,750)          --
    Proceeds from sale of common stock                                   --              390
    Proceeds from sale of preferred stock                                --          100,000
    Preferred stock dividends paid                                       --          (38,184)
    Payments on notes payable                                         (16,099)       (40,466)
    Proceeds from notes payable                                          --           35,000
    Net advances from related parties                                  80,000           --
    Proceeds from convertible notes payable (including $0 and
         $133,333 from a related party, at September 30, 2003
         and 2002, respectively)                                         --          300,000



                                       5
<PAGE>

    Proceeds from convertible bonds payable (including $5,500
         and $0 from a related party, at September 30, 2003 and
         2002, respectively)                                          645,000         65,000
                                                                  -----------    -----------
Net cash provided by financing activities                             671,151        421,740
                                                                  -----------    -----------

Net decrease in cash and cash equivalents                              85,074       (246,775)
Cash and cash equivalents at beginning of period                       64,278        261,761
                                                                  -----------    -----------
Cash and cash equivalents at end of period                        $   149,352    $    14,986
                                                                  ===========    ===========

Supplemental Disclosure of Cash Flow Information:
    Cash paid for interest                                        $      --      $      --
    Cash paid for income taxes                                    $      --      $      --

Supplemental Disclosure of Non-Cash Information:
    Warrants issued in connection with obtaining debt financing   $      --      $    41,569
    Preferred stock dividend accrued                              $    48,854    $    22,622
    Preferred stock converted into convertible bonds              $    85,000    $      --
    Common stock issued as dividends on preferred stock           $      --      $     2,126
    Common stock issued for assets not yet received               $      --      $   300,000
    Common stock issued in the GRO acqusition                     $    80,500
    Receipt of asset purchased with common stock                  $   124,000    $      --
    Conversion of convertible bonds to common stock (stock
         has not yet been issued at September 30, 2003)           $   143,000    $      --
    Convertible bonds issued as payment for accrued interest      $    13,930    $      --
    Convertible bonds issued as payment for accrued dividends     $    17,818    $      --
    Bonds issued with beneficial conversion feature recorded
         as debt discount                                         $    33,513    $      --
    Sale of certain assets in exchange for a receivable           $   225,000    $      --
    Conversion of advances to related parties to convertible
         bonds                                                    $    15,000    $      --

</TABLE>






           See accompanying notes to consolidated financial statements


                                       6
<PAGE>

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.   Basis of Presentation and Company Information

     The  financial  statements  included  herein have been prepared by Rushmore
Financial Group, Inc. ("Company" or "RFGI") without audit, pursuant to the rules
and regulations of the Securities and Exchange  Commission.  Certain information
and footnote  disclosures  normally included in financial statements prepared in
accordance with accounting principles generally accepted in the United States of
America have been condensed or omitted  pursuant to such rules and  regulations,
although the Company believes that the disclosures contained herein are adequate
to make the information presented not misleading.  In the opinion of management,
the information  furnished in the unaudited  consolidated  financial  statements
reflects all  adjustments  which are ordinary in nature and necessary to present
fairly the Company's  financial  position,  results of operations and changes in
financial position for such interim period.  These interim financial  statements
should be read in conjunction  with the Company's  financial  statements and the
notes  thereto as of and for the year ended  December 31, 2002,  included in the
Company's annual report on Form 10-KSB for the year ended December 31, 2002.

     Rushmore Financial Group, Inc., dba RushTrade(R)Group ("RFGI",  "RushTrade"
or "the Company") is a holding company for two primary subsidiaries: a real-time
financial  technology  development  company and a new  generation  direct-access
online brokerage firm. The Company, a Texas corporation, was formed in September
1990 and commenced operations in March 1991.

     The Company was  originally  founded as a  traditional  financial  services
company that over the past decade grew from a start-up  into a retail  brokerage
organization with a nationwide account base and network of agents and registered
representatives  for the sale of insurance and investment  products.  Management
over the past three years has divested and  redeployed  assets in an  aggressive
re-positioning  strategy,  redirecting  its emphasis  away from the  traditional
retail brokerage  business with its lower operating margins to capitalize on the
rapidly  expanding  market for real-time  financial  services  technologies  and
direct access online trading that is  revolutionizing  the online  brokerage and
institutional trading industry.

     In 2000, RushTrade launched a $5 million proprietary technology development
initiative  in  response  to the  burgeoning  market  for direct  access  online
trading.  After more than three years of development and successful beta testing
the Company  introduced  its direct  access  technology  platform in August 2002
under its RushTrade(R) brand. Currently,  management expects RushTrade revenues,
growth in new accounts and trade volumes to continue  their  month-to-month  and
quarter-to-quarter increases now that the RushTrade business unit has become the
Company's primary source of revenue.

     The  Company's  common stock began  trading on the Nasdaq  SmallCap  Market
under the symbol "RFGI"  following  Rushmore's  initial public offering in April
1998.  On August 23, 2002 its stock was delisted by the Nasdaq  SmallCap  Market
for failure to meet the $1.00 minimum price and other requirements and was moved
to the Nasdaq OTC Bulletin Board Exchange.

     The accompanying  financial statements have been prepared assuming that the
Company will continue as a going concern. At September 30, 2003, the Company had
$3,650,350  in  liabilities,  and cash and  accounts  and other  receivables  of
$237,478.  Also, the Company  incurred net losses from continuing  operations of
$2,203,896 in 2001,  $3,131,636 in 2002, and $1,343,268 in the first nine months
of 2003. Although the Company believes that it will be able to continue to raise
the necessary funds until it reaches a sustainable level of profitability, these
matters raise  substantial  doubt about the  Company's  ability to continue as a
going  concern.  The financial  statements do not include any  adjustments  that
might result from the outcome of this uncertainty.

     The Company has taken  several  steps to increase cash through the issuance
of debt and equity securities. Year to date, the Company raised $745,000 through
a 12% Senior Secured  Convertible Bond offering and other short term borrowings.
These bonds bear interest at 12% per annum, principal and interest are due on or
before  December 31, 2007 and are  convertible  into shares of common stock at a
rate of 50% of the average  market price of the stock for the ten days preceding
the date of conversion, but not less than $0.15 per share. The Company may force
conversion if the stock trades above $2.00 per share for 10 consecutive  trading
days. The bonds are secured by the RushTrade  software,  trade names,  websites,
customer  accounts and other assets.  The Company has extended the bond offering
and will attempt to raise  additional  capital  through the ongoing sales of the
bonds.  The  Company  believes  that it will be able to  continue  to raise  the
necessary  funds by means of  private  placements  of equity or debt  securities
until it reaches a sustainable level of profitability.

                                       7
<PAGE>

     The Company conducted an extensive internal reorganization and reduction of
staff related to its  repositioning  and new business  development  activies and
implemented steps to closely monitor expenses. Additional marketing efforts have
been  implemented  to  increase  revenues  since the  release  of the  RushTrade
software products in late 2002. Pending the release of the RushTrade Back Office
Tool,  the  Company   expects  to  pursue   licensing   agreements   with  other
broker/dealers  and other financial  institutions which is expected to produce a
new revenue stream that is expected to further increase revenue.

     RushTrade's  marketing and sales efforts are currently  underway to acquire
new  active  trader/customer  accounts  that  will  generate   transaction-based
revenue.  RushTrade believes that it has the low cost operational infrastructure
and a relatively low threshold to reach profitability in the near future.  Since
December 2002 new sales  representatives  have been hired to generate additional
sales leads. Additionally,  the Company is using Internet advertising to provide
leads for the sales  representatives.  The Company believes that it has embarked
on  a  successful   marketing   strategy  to  generate  the   necessary   active
trader/customer  accounts to capture  customer assets with the trade volumes and
related revenues necessary to reach a sustainable level of profitability.  There
can be no  assurances  that the steps  taken by the  Company  will result in the
Company  being able to settle  its  liabilities  as they  become due or that the
Company  will  be able to  generate  revenues  or  cash  flows  from  financings
sufficient to support its operations in the short term.

2.   Use of Accounting Estimates

     The  preparation  of financial  statements  in conformity  with  accounting
principles   generally  accepted  in  the  United  States  of  America  requires
management to make estimates and assumptions that affect the reported  financial
statement amounts and disclosures.  Accordingly, the actual amounts could differ
from those estimates.

3.   Industry Segment Information

     The Company's  segments have been identified based on products and services
offered as well as risks assumed in a manner  consistent  with the data utilized
by the Chief Executive Officer in evaluating operations. Rushmore Securities and
RushTrade Securities offer broker/dealer services and their operations have been
included  in the  Investment  Services  segment.  Rushmore  Insurance  Service's
operations,  for the most  part  inactive,  have  been  included  in  Investment
Services. The Software Services segment is comprised of RushGroup  Technologies,
Inc., formerly RushTrade Software Services,  Inc., which offers licensing of the
RushTrade  direct  access  software  and other  arrangements  and is expected to
become a significant  stream of revenue for the Company in the future.  There is
ongoing  development  activity  on the  software  to enhance  its use to outside
entities;  however,  the Company has not received any revenue to date related to
the Software Services  segment.  During the first six months of 2002 the Company
did not incur any  expenses  from this  source  since all costs  related to this
activity were being capitalized.

     The assets of the parent company,  Rushmore Financial Group, Inc., are used
to support the  operations  of the two primary  operating  divisions:  RushGroup
Technologies,  Inc., the Company's financial technology  development  subsidiary
and RushTrade Securities, the Company's direct access online broker/dealer.  The
expenses  of the parent  company  are  included  in general  and  administrative
expenses.

     This segment  allocation  reflects the Company's  repositioning to a direct
access  online  financial   services  and  a  real  time  financial   technology
development company from its traditional financial services holding company with
traditional insurance and broker/dealer services.

     The  following  summarizes  the  Company's   identifiable  assets,  capital
expenditures  and  depreciation  and  amortization by industry segment as of the
dates indicated:

                                                  September 30,
                                         -----------------------------
              Identifiable Assets             2003            2002
           --------------------------    -------------   -------------
           Investment Services             $   356,024     $   379,281
           Software Services                 1,433,408       2,014,393
           Corporate                           272,344         639,892
                                         -------------   -------------
                     Total                 $ 2,061,776     $ 3,033,566
                                         =============   =============


                                       8
<PAGE>
<TABLE>
<CAPTION>

                              Three Months Ended September 30,    Nine Months Ended September 30,
                              --------------------------------   --------------------------------
   Capital Expenditures            2003              2002             2003              2002
--------------------------    --------------    --------------   --------------    --------------
<S>                           <C>               <C>              <C>               <C>
Investment Services             $          -      $     10,689     $          -      $     25,011
Software Services                     27,662           110,887           82,586           448,047
Corporate                                  -                 -                -                 -
                              --------------    --------------   --------------    --------------
          Total                 $     27,662      $    121,576     $     82,586      $    473,058
                              ==============    ==============   ==============    ==============

                              Three Months Ended September 30,    Nine Months Ended September 30,
     Depreciation and         --------------------------------   --------------------------------
       Amortization                 2003              2002             2003              2002
--------------------------    --------------    --------------   --------------    --------------
Investment Services             $     15,072      $     14,709     $     26,820      $     87,596
Software Services                    172,911           172,911          518,733           172,911
Corporate                             13,531            26,375           48,994            70,618
                              --------------    --------------   --------------    --------------
          Total                 $    201,514      $    213,995     $    594,547      $    331,125
                              ==============    ==============   ==============    ==============

     The following  summarizes the Company's industry segment operating data for
the periods indicated:

                              Three Months Ended September 30,    Nine Months Ended September 30,
                              --------------------------------   --------------------------------
         Revenue                    2003              2002             2003              2002
--------------------------    --------------    --------------   --------------    --------------
Investment Services             $    366,928      $    421,376     $    805,115      $  3,678,124
Software Services                          -                 -                -                 -
Corporate                                  -                 -           10,016                 -
                              --------------    --------------   --------------    --------------
          Total                 $    366,928      $    421,376     $    815,131      $  3,678,124
                              ==============    ==============   ==============    ==============

                              Three Months Ended September 30,    Nine Months Ended September 30,
                              --------------------------------   --------------------------------
         Expense                    2003              2002             2003              2002
--------------------------    --------------    --------------   --------------    --------------
Investment Services             $    415,418      $    448,204     $  1,178,886      $  3,741,585
Software Services                    172,911           172,911          524,566           172,911
Corporate                            270,699           199,412          733,838         2,161,247
                              --------------    --------------   --------------    --------------
          Total                 $    859,028      $    820,527     $  2,437,290      $  6,075,743
                              ==============    ==============   ==============    ==============


                              Three Months Ended September 30,    Nine Months Ended September 30,
                              --------------------------------   --------------------------------
     Net Income (Loss)              2003              2002             2003              2002
--------------------------    --------------    --------------   --------------    --------------
Investment Services*            $    230,401      $    (26,828)    $    (94,880)     $    (63,461)
Software Services                   (172,911)         (172,911)        (524,566)         (172,911)
Corporate                           (270,699)         (199,412)        (723,822)       (2,161,247)
                              --------------    --------------   --------------    --------------
          Total                 $   (213,209)     $   (399,151)    $ (1,343,268)     $ (2,397,619)
                              ==============    ==============   ==============    ==============

</TABLE>

*The net income  (loss) from  investment  services for the three and nine months
ended September 30, 2003 includes other income of $278,891 resulting from a gain
on the sale of certain assets and a gain on the settlement of liabilities.

4.   Capitalized Software Development Costs

     The Company  capitalizes  certain costs  associated with the development of
the  RushTrade  software  products in  accordance  with  Statement  of Financial
Accounting Standards No. 86, "Accounting for the Cost of Computer Software to be
Sold, Leased or Otherwise Marketed" ("SFAS 86"). During the first nine months of
2003,  the  Company  capitalized  $82,586 in cost versus  $448,047  for the same
period in 2002. As of September 30, 2003, the total of all capitalized  software
development costs was $2,297,963. Upon release of each of the RushTrade products
or modules,  additional  costs  related to that  product or module,  that do not
represent  significant  improvements or modifications,  are charged to operating

                                       9
<PAGE>
<TABLE>
<CAPTION>

expenses instead of being capitalized.  Additionally,  all presently capitalized
costs  relating to a released  product or module are amortized by the greater of
the revenue method or the straight-line method over a three-year period. For the
nine months ended  September 30, 2003 and 2002, the Company  amortized  $518,733
and $172,911 of software costs, respectively,  using an estimated useful life of
three  years.  At  September  30,  2003 and 2002,  accumulated  amortization  of
capitalized   software   development   costs  totaled   $864,555  and  $172,911,
respectively.

5.   Reclassifications

     Certain  2002  balances  have  been  reclassified  to  conform  to the 2003
presentation.

6.   Net Loss Per Share

     Basic  and  diluted  loss  per  share  is  computed  by  dividing  net loss
applicable  to common  stock by the  weighted  average  number of common  shares
outstanding for the period.  Stock options to purchase common stock  outstanding
for the  three  and nine  months  ended  September  30,  2003 and 2002  were not
included  in the  computation  of  diluted  loss per  share  because  they  were
antidilutive.

     Loss per share applicable to common  shareholders for the periods indicated
are computed using the following information:

                              Three months ended September 30,    Nine months ended September 30,
                              --------------------------------   --------------------------------
                                   2003              2002             2003              2002
                              --------------    --------------   --------------    --------------
<S>                           <C>               <C>              <C>               <C>
Net loss                        $   (213,209)     $   (399,151)    $ (1,343,268)     $ (2,397,619)
Dividends on preferred
     stock                           (15,647)          (22,622)         (48,854)          (62,932)
                              --------------    --------------   --------------    --------------
Net loss applicable to
     common shareholders        $   (228,856)     $   (421,773)    $ (1,392,122)     $ (2,460,551)
                              ==============    ==============   ==============    ==============
Net loss per share
     applicable to common
     shareholders               $      (0.02)     $      (0.05)    $      (0.14)     $      (0.32)
                              ==============    ==============   ==============    ==============

</TABLE>

7.   Intangibles

     In March 2002, the Company entered into an Agreement, as an amendment to an
earlier  revenue-sharing  agreement,  with NewportX.com,  an affiliate of Online
Trading  Academy of Irvine,  CA.  ("OTA") to acquire a block of up to 150 active
trader  accounts  which were to be referred or  directed to  RushTrade  over six
months in exchange for 1,200,000 shares of RFGI common stock.  These shares were
issued  during March 2002 and the Company  recorded a prepaid asset of $300,000,
the fair  value  of the  stock on the date of  issuance.  As the  active  trader
accounts are received and certified,  the Company  reclassifies these amounts to
an intangible  asset.  During the nine months ended September 30, 2003 62 trader
accounts  were  certified  and  accordingly  $124,000 has been  reclassified  to
intangible  assets.  In total as of September 30, 2003, 97 trader  accounts have
been certified and $189,000 has been  reclassified  to intangible  assets and is
being  amortized over three years,  the estimated  life of the trader  accounts.
Amortization  of this  intangible for the nine months ended  September 30, 2003,
was $29,333. At September 30, 2003, accumulated  amortization of this intangible
totaled  $34,333.  OTA is behind  schedule in delivering  trader accounts to the
Company.  All 150 trader  accounts were to have been  delivered by September 30,
2002 but as of September 30, 2003 only 97 have been delivered and certified. OTA
had  originally  projected  training 50 traders per month but during the term of
the agreement  has only trained 20 or fewer  traders per month.  The Company has
extended  the  agreement  and  expects  OTA to fulfill  the  agreement.  Through
September  30, 2002 the  undelivered  trader  accounts were carried as a prepaid
asset; however,  since the agreement was to be fulfilled by the end of September
2002 and the accounts have been slower in  converting to the RushTrade  platform
than was originally  anticipated,  the asset was reclassified as a contra equity
account during the fourth quarter of 2002.

8.   Convertible Bonds Payable

     During the nine months ended  September 30, 2003,  the Company issued forty
12% Senior  Secured  Convertible  Bonds  ("convertible  bonds") for  proceeds of
$645,000,  had $85,000 of preferred stock convert into  convertible  bonds,  had
$143,000 of  convertible  bonds  convert into common  stock,  issued  $31,748 of

                                       10
<PAGE>
<TABLE>
<CAPTION>

convertible  bonds as payment for accrued  interest  and  accrued  dividends  on
preferred  stock that converted into  convertible  bonds,  and issued $15,000 of
convertible  bonds as payment on advances to related  parties.  The  convertible
bonds bear  interest  at 12% per annum and are  convertible  into the  Company's
common  stock at a rate of 50% of the average  market price of the stock for the
ten days  preceding  the  conversion  date,  but not less than  $0.15 per share.
Principal  and interest  will be repaid on or before  December 27, 2007,  if not
converted  prior.  The Company may force  conversion  if the stock  trades above
$2.00 per share for 10  consecutive  trading days.  The bonds are secured by the
RushTrade software,  trade names, websites,  customer accounts and other assets.
In accordance  with EITF 00-27,  the Company  valued the  beneficial  conversion
feature of these bonds at $33,513. The beneficial conversion feature is recorded
as a debt discount and is being  amortized as interest  expense over the term of
the bonds. Interest expense related to the amortization of the debt discount for
the  nine  months  ended  September  30,  2003  and  2002  was  $1,363  and  $0,
respectively.  Convertible  bonds with a  principal  balance of  $1,173,748  are
outstanding as of September 30, 2003.

9.   Convertible Notes Payable

     The Company has $185,000 in unsecured notes payable,  convertible  into the
12% Senior Secured Convertible Bonds, to a related party that are currently due.
These notes are payable on demand,  but the Company has  received a request from
the note  holder that the notes and accrued  interest be  converted  into common
stock. Convertible notes with a principal balance of $485,000 are outstanding as
of September 30, 2003.

10.  Stock-Based Compensation

     The Company accounts for its stock-based  employee  compensation plan using
the intrinsic  value-based  method  prescribed by  Accounting  Principles  Board
Opinion  No.  25,  "Accounting  for Stock  Issued  to  Employees,"  and  related
interpretations.  As such, compensation expense is recorded on the date of grant
to the extent the  current  market  price of the  underlying  stock  exceeds the
option  exercise  price.  The  Company did not record any  compensation  expense
related  to the  issuance  of stock  options to  employees  for the three or six
months  ended June 30, 2003 and 2002.  Had the Company  determined  compensation
based on the fair value at the grant date for its stock options under  Statement
of Financial  Accounting Standards ("SFAS") No. 123, "Accounting for Stock-Based
Compensation,"  as  amended  by  SFAS  No.  148,   "Accounting  for  Stock-Based
Compensation  - Transition  and  Disclosure,"  net loss  attributable  to common
stockholders and loss per share would have been increased as indicated below:

                                                       Three Months                   Nine Months
                                                    Ended September 30,           Ended September 30,
                                                --------------------------    --------------------------
                                                    2003           2002           2003           2002
                                                -----------    -----------    -----------    -----------
<S>                                             <C>            <C>            <C>            <C>
Net loss attributable to common stockholders,
   as reported                                  $  (228,856)   $  (421,773)   $(1,392,122)   $(2,460,551)
Add:  Stock-based employee compensation
   expense included in reported net loss               --             --             --             --
Deduct:  Stock-based employee compensation
   expense determined under fair value based
   method                                              --          (13,012)          --          (39,036)
                                                -----------    -----------    -----------    -----------
Pro forma net loss                              $  (228,856)   $  (434,785)   $(1,392,122)   $(2,499,587)
                                                ===========    ===========    ===========    ===========

Net loss per share
As reported                                     $     (0.02)   $     (0.05)   $     (0.14)   $     (0.32)
                                                ===========    ===========    ===========    ===========
Pro forma                                       $     (0.02)   $     (0.05)   $     (0.14)   $     (0.33)
                                                ===========    ===========    ===========    ===========

</TABLE>

11.  Related Party Transactions

     During the nine months  ended  September  30,  2003,  the Company  received
advances from related parties totaling  $100,000.  The advances are non-interest
bearing and  unsecured.  $65,000 of the advances was received from  relatives of
the Chief Executive  Officer and $35,000 was received from an entity  controlled
by a member of the Board of  Directors.  During  the third  quarter  of 2003 the
Company  repaid  $20,000 of the advances and $15,000 were converted into the 12%

                                       11
<PAGE>

Senior  Secured  Convertible  Bonds.  The Board member has signed a subscription
agreement  to accept  common stock for his $35,000  advance  when shares  become
available after the stockholders  meeting. Of the remaining outstanding advances
of $65,000 at September 30, 2003,  $35,000 will be settled  through the issuance
of common stock during the fourth quarter of 2003 and the balance is expected to
be repaid in early 2004.

     During the second quarter of 2003, the Company issued  convertible bonds to
a relative of the Chief Executive Officer totaling $10,000.

12.  Shareholders' Deficit

     During the second quarter the Company issued 146,250 shares of common stock
(valued at $20,162 based on the fair value of the Company's  common stock on the
date of issuance) to employees as  additional  compensation.  Theses shares were
issued from treasury stock held by the Company.

     During the second quarter of 2003, the Company granted 1,260,000 options to
employees and directors.  Theses options have an exercise price of $0.15, a term
of 5 years and vest 50% after six months and 50% after one year.

     During the third quarter of 2003, the Company issued 2,000 shares of common
stock for services  and 5,000 shares of common stock as part of a settlement  of
certain liabilities. The common stock issued during the third quarter was valued
at  $1,890  based  on the  fair  value  of the  Company's  stock  on the date of
issuance.

     During the third quarter of 2003,  holders of $143,000 of convertible bonds
elected to convert their bonds into 918,366 shares of common stock.  The Company
did not have an adequate  number of shares of common  stock  available  to issue
these shares and as a result has recorded pending stock issuances of $143,000 as
a separate component of shareholders'  deficit.  Early in 2003, pending approval
by the Company's  stockholders,  the Company's  Board of Directors  approved the
increase  in  the  number  of  authorized  common  shares  of the  Company  from
10,000,000 to 50,000,000.  This increase will allow the pending stock  issuances
that resulted from the conversion of the bonds to be issued.

13.  Payroll Tax Obligation

     The Company has an estimated  federal and state  payroll tax  obligation of
$144,565 at September 30, 2003. The Company has estimated this  obligation to be
the amounts of tax withheld from  employees  and the employer  portion of Social
Security  Federal  Tax  Obligation  for the first and second  quarter of 2003 in
addition to an  estimated  accrual for interest  and  penalties.  This amount is
included  in  accrued  expenses  and  other   liabilities  in  the  accompanying
consolidated balance sheets.

14.  Sale of Certain Assets

     During  September  2003,  the  Company  sold  certain  assets  of  Rushmore
Securities  Corporation for a purchase price of $225,000 to Brazos Holdings. The
assets that were sold had been previously written down to zero. Accordingly, the
entire  consideration  received  was  recorded as income and is presented in the
accompanying  consolidated  statement of  operations as "Gain on sale of certain
assets". Per the sale agreement,  the purchase price was to be received in three
equal  installments  of  $75,000.  As of  September  30,  2003,  the Company has
received  $150,000 of the purchase  price and has a receivable  recorded for the
remaining $75,000, which is expected to be received before the end of 2003.

15.  Gain on Settlement of Liabilities

     During the third quarter of 2003, the Company settled  certain  liabilities
totaling  approximately  $99,000 for $45,000.  As a result of the settlement the
Company  recorded  a gain  of  approximately  $54,000,  which  is  presented  in
accompanying  consolidated  statement of  operations  as "Gain on  settlement of
liabilities".

16.  Legal Proceedings

     The  Company and its  subsidiaries  are  engaged in legal  proceedings  and
arbitrations  from time to time.  Management  believes some of these proceedings
could have a material  effect upon the operations or financial  condition of the
Company if the Company is unsuccessful in defending against the actions. In some
cases the actions could affect the subsidiary,  Rushmore Securities, but not the
Company.

                                       12
<PAGE>

     On January 16, 2003, eight former securities  account customers of Rushmore
Securities  filed a  complaint  against the  Company  contending  that they made
numerous  investments in securities that a former account  representative of the
Company  sold  outside  and away from his  representation  of the  Company.  The
claimants allege the investments were  fraudulent,  speculative,  and unsuitable
and that the  Company  failed to  properly  supervise  the  representative.  The
claimants  contend they  invested  $808,000 in these  securities  and the entire
amount was lost through such  investments.  The Company denies the  allegations,
contends they are barred by the applicable  statutes of limitations  and intends
to vigorously pursue its defense.  Currently,  the Company is unable to estimate
the ultimate liability, if any, related to this complaint.  However, should this
complaint  be settled in favor of the former  customers,  any  liability  to the
Company would have an adverse effect on the Company's financial condition.

     In June 2002, a former securities  account customer of Rushmore  Securities
filed for NASD  arbitration  against her former account  representative  and her
successor  brokerage firm. She has improperly named Rushmore  Financial Group as
respondent.  The account representative settled this issue with the claimant for
$11,000 on April 30,2003. The Company issued the account representative a $3,000
bond as an inducement to settle.

     In April 2003, a group of former securities  representatives filed for NASD
Dispute  Resolution naming the Company,  Rushmore  Securities and Mr. Moore. The
former representatives are claiming $178,288 in commissions.  A date or location
for the hearing has not been set.  The Company has  unsuccessfully  attempted to
negotiate a settlement with the representatives and intends to vigorously defend
the claim.  The Company has  estimated  the ultimate  liability  related to this
claim to be  approximately  $43,000 and  accordingly has recorded an accrual for
this  amount  in  the  financial  statements.  This  issue  is  pending  with  a
preliminary hearing to take place on April 6, 2004.

     An employee  consultant  agency filed a claim in the Dallas County Court at
Law, on December 17, 2002 claiming  that the Company  failed to pay for services
rendered in placing  temporary  workers in the amount of  $41,630.  The suit was
settled on July 24, 2003 for $15,000 and 5,000  shares of the  Company's  common
stock valued at $1,450.

     In May 2003, a former  securities  account customer of Rushmore  Securities
filed for NASD  arbitration  against their former  account  representative,  the
account representative's account manager, their local office and their successor
brokerage  claiming  the  investments  were  unsuitable  and  speculative  their
accounts  decreased  in value by  $125,000.  A response was made On May 28, 2003
with a preliminary hearing scheduled for April 12, 2004. Currently,  the Company
is unable to estimate the ultimate liability, if any, related to this complaint.

     In May 2003, a former  securities  account customer of Rushmore  Securities
filed for NASD arbitration  against her former account  representative and their
successor   brokerage  firm  claiming   their   investments   were   unsuitable,
speculative, negligent, gross negligent and with negligent supervision and their
accounts  decreased in value by between $100,000 and $500,000.  On June 23, 2003
the Company  filed a response and is waiting for the notice for the  preliminary
hearing. Currently, the Company is unable to estimate the ultimate liability, if
any, related to this complaint.

     On June 30, 2003, a former  vendor filed a claim in the Dallas County Court
claiming that the Company failed to pay for services rendered on their copier in
the amount of  $39,710.  The  Company has filed a counter  claim  alleging  over
charges and the improper  installation of a software  product caused the Company
incalculable harm. A non-jury trial is set for January 14, 2004. Currently,  the
Company is unable to estimate the ultimate  liability,  if any,  related to this
complaint.

     On August 5, 2003, a financial daily business  publication filed a claim in
the Dallas  County  Court at Law  claiming  that the  Company  failed to pay for
advertising in their  publication in the amount of $4,513. On August 29, 2003, a
response  was  filed  with  the  court.  This  item is  pending  settlement  for
approximately $6,200.

     On November  10,  2003, a former  securities  account  customer of Rushmore
Securities   filed  for  NASD   arbitration   against   their   former   account
representative,   and  their  successor  brokerage  firm  claiming  his  account
decreased in value by $150,000 due to fraud, negligence, and breach of fiduciary
duty.  The Company  must file a response by December 26,  2003.  Currently,  the
Company is unable to estimate the ultimate  liability,  if any,  related to this
complaint.

                                       13
<PAGE>

      On November 12, 2003, a former  vendor filed a claim in the Dallas  County
Court that the Company failed to pay for services rendered on the publication of
Company  documents in the amount of $11,865.  The Company has fully  accrued the
amount of this  liability  and will attempt to  negotiate a settlement  with the
vendor.






























                                       14
<PAGE>

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
of Operations

1.   Recent Developments

     On February 24, 2003 the Company and Knobias Holdings, Inc., ("Knobias"), a
real-time news and content technology development company,  reached an agreement
in  principle  to form a  strategic  alliance.  During  the  first  phase of the
relationship,  the parties  entered  into a Product and  Services  Exchange  and
Software  License  Agreements  whereby  Knobias  agreed to supply  RushTrade its
"News, Research, Fundamental" and other data in exchange for RushTrade supplying
Knobias with  RushTrade's  "Real Time  Charts." To date,  the first phase of the
relationship  has  been  successfully  completed.  Knobias  news,  research  and
fundamentals have been  successfully  integrated into both the Direct and Direct
Pro products  replacing three separate  vendors that had been supplying  various
portions of the content.

     The second phase of the relationship is the formation of a joint venture to
jointly build, offer and market a  Knobias-RushTrade  co-branded  "top-line desk
top" product to serve the institutional marketplace.  Both RushTrade and Knobias
believe  that  this  co-branded   product  would  compete   effectively  in  the
institutional market.

     On  August  22,  2003  the  Company's   subsidiary,   Rushmore   Securities
Corporation,  entered into an agreement with Brazos Holdings, an affiliate of an
NASD  registered  Broker/Dealer  to sell certain  assets of the  subsidiary  for
$225,000 in cash.  Of this amount  $150,000 has been  received and the remaining
$75,000 is expected to be paid on or before  December 31, 2003.  The Company had
previously  written  off the  entire  value of the assets  and the  $225,000  is
accounted for as other income.

2.   RushTrade Direct Access Online Services Software Development

     RushTrade offers two distinct and proprietary products to meet the needs of
active  online  investors,  semi-professional  traders and  portfolio  managers:
RushTrade  Direct,  a Level I browser-based  product and RushTrade Direct Pro, a
Level II software-based product.

     Both RushTrade Direct and RushTrade  Direct Pro provide  customers or other
users and licensees of the RushTrade  software with real-time quotes and charts,
fast  and  reliable  access  to  multiple   exchanges,   ECNs  or  market  maker
participants and other advanced decision support and portfolio management tools.

     Using the RushTrade products,  customers/users purchasing or selling shares
of stock receive the best possible price because orders are sent directly to the
particular Exchange or Electronic Communications Network (ECN) offering the best
price on any particular  stock at any given time. In contrast,  most traditional
on-line brokerage firms process customer orders through  browser-based  software
that  routes  the  order  through  the  firm's  trading  desk or to  third-party
wholesalers with "payment for order flow" arrangements that normally inhibit the
customers' price, speed and quality of execution.

     RushTrade  Direct  fulfills  the needs of online  investors  by  delivering
real-time quotes and aggregated  information from third party providers combined
with  RushTrade's  Direct  Access  Routing  Technology  (DART(TM)).  Experienced
registered   representatives  provide  customer  service.  RushTrade  Direct  is
delivered to customers via the Internet and can be accessed  from  virtually any
computer with a web browser.

RushTrade Direct features include:

     o    Intraday and historical charts
     o    A list of upcoming stock splits
     o    Analyst upgrades and downgrades
     o    News headlines and advanced news search
     o    Company and symbol lookup
     o    Market commentary
     o    Market summary
     o    Company fundamental data
     o    A calendar of upcoming economic events including estimates
     o    A listing of several market indices with quotes


                                       15
<PAGE>

     RushTrade  Direct Pro meets the requirements of more  sophisticated  online
investors,  semi-professional  traders and  portfolio  managers by providing the
latest trading  technologies  and services  available in an easy-to-use  trading
system.  Significant  features  of  the  Level  II  product  include  streaming,
real-time  Level  II  stock  quotes,  news,  charts,  research  and  RushTrade's
proprietary  Direct Access Routing Technology  (DART(TM)).  RushTrade Direct Pro
clients have access to the same customer  service support that RushTrade  Direct
users receive.

     The technological  advancements made in RushTrade Direct Pro constitute the
third  generation  (3G) of  trading  software  platforms.  RushTrade  Direct Pro
provides  a clean and  intuitive  user  interface  through  the use of  multiple
methods of accessing each tool and performing  each task and the  utilization of
advanced Windows(TM) functionality.  RushTrade's Level II product user interface
is designed to be much more efficient than that of the competition.

     RushTrade   Direct  Pro  software  can  be  downloaded  with  less  than  a
1.6-megabyte requirement verses 8 to 10 megabytes required for most of the other
competitive  software  platforms.  While  other  competitive  platforms  require
broadband data  connections  such as ISDN, DSL or T-1  connections,  the Company
believes that RushTrade Direct Pro is the only Level II software  application of
its kind that will  operate  effectively  with as little as a 56K modem  dial up
connection.

     RushTrade  believes  that  its  data  center  can  host  200% to 300%  more
customers per server than its  competitors.  These features are expected to give
RushTrade a distinctive advantage in the marketplace and substantial  advantages
as a low cost services provider in its operations and in the proposed  licensing
of the RushTrade software to other broker/dealer firms.

     While improving upon the user interface, RushTrade simultaneously developed
decision  support  tools  that  provide  many  of the  latest  advanced  trading
technologies.   These   technologies   include  multiple  order  entry  methods,
sophisticated basket trading capabilities, conditional orders, parametric alerts
and a stock market screening tool. These advanced  decision support tools enable
traders and active investors to quickly make more informed decisions.

In addition, RushTrade Direct Pro features include:

     o    User defined alarms and screen alerts
     o    Most actives, top % gainers, top % decliners
     o    Streaming, real-time Level II Quotes
     o    Direct access trading utilizing DART(TM)
     o    Conditional   Orders  i.e.:   Trailing  Stops,  Make  Best,   Reserve,
          Discression, etc.
     o    Market Matrix(TM) stock screening tools
     o    Powerful charting package including intra-day charts and studies
     o    3G Board View (Watch list)
     o    Real-time news available option and fully customizable format
     o    A calendar of upcoming economic events including estimates
     o    A listing of several market indices with quotes

Technology

     RushTrade's  Direct Access Routing  Technology  (DART(TM)) is a proprietary
smart order routing  technology  that provides  advanced  Direct Access  trading
capabilities  to online  investors.  DART(TM) is directly  connected to multiple
Exchanges and Electronic Communication Networks (ECNs), which allow customers to
bypass  the  "middlemen",  brokers  or Market  Makers  that  have  traditionally
executed  customer  orders.  ECNs receive orders that are executed against other
orders within the ECN's electronic order book.

These market participants include:

     o    Nasdaq SuperMontage(TM) System
     o    New York Stock Exchange SuperDOT(TM) System
     o    American Stock Exchange SuperDOT(TM) System
     o    Archipelago/REDIBook ECN
     o    Instinet/Island ECN and others

                                       16
<PAGE>

     Utilizing  these  multiple  direct  connections,   DART  automatically  and
continuously  searches  the  entire  market  for the best  price  available  and
automatically  sends the order to that particular  market maker participant in a
fraction  of a  second.  DART(TM)  continues  to  send  the  order  until  it is
completed.

     DART's smart order routing is  accomplished  by an  innovative  proprietary
trading  algorithm  developed  by  RushTrade's   software  development  team  in
collaboration  with experienced day traders and  semi-professional  traders with
years of trading experience.

Market Opportunity

     Online  trading  remains  a  dynamic  force in  today's  financial  markets
representing  nearly  one-third  of total  trading  volume on the New York Stock
Exchange and Nasdaq.  According to Bear Stearns & Co. Inc., there were over 20.5
million online retail trading  accounts in the United States at the beginning of
2003, up 8% from 19 million in 2002 which was up from 17.4 million,  an increase
of 20% from 2001. "Semi-professionals" accounted for 83% of this trading volume.

     Many industry experts expect "direct-access to become an increasingly large
part of trading  operations and hedge funds in the US and abroad and continue to
dominate retail day trading with order volumes to steadily increase the next few
years, from over 300 million in 2002 to 400 million in 2003 to approximately 500
million  in  2005,"  according  to the  December  2002  issue of  Active  Trader
Magazine.  The Company believes it has a superior,  low cost product offering to
very  receptive  markets  in both  retail  direct  access  online  space and the
institutional market.

     The  convergence  of  these  market  forces  with the  availability  of new
technologies and regulatory  actions to improve market  efficiencies have caused
industry  analysts to view Direct  Access as the next  frontier in the brokerage
industry. Much like the traditional retail brokerage industry was revolutionized
by the introduction of online trading,  Direct Access is seen as the second wave
of  change  transforming  the  online  brokerage  business  according  to Keefe,
Bruyette  & Woods,  Inc.,  an  industry  specialist  in  banking  and  financial
services.

     A  strategic  partner  of the  Company,  Knobias.com,  LLC  is a  financial
information service provider which creates, consolidates, maintains and delivers
a complete  database of historical and real-time  information  covering the U.S.
equities market.  New technologies have begun to erode the dominance  previously
enjoyed by a few large  players.  These  giants have  profited  for years from a
product offering of expensive,  proprietary  technology platforms.  The Internet
Age has helped many small providers who can more efficiently  deliver  financial
tools and information.

     RushTrade  and Knobias have  combined  their  efforts to offer a co-branded
RushTrade Direct  Pro/Knobias  Desk Top Product,  which will provide to this $14
billion industry a new-age platform that the Company believes is more efficient,
complete, and extremely price competitive.  As the industry consolidates vendors
and costs,  both RushTrade and Knobias  believe that they are well positioned to
quietly chip away market share form the few industry leaders through  aggressive
marketing,  competitive  pricing,  flexible  deployment,  efficient delivery and
creative consolidation.

Growth Strategy

     RFGI's growth plan involves several key components  including online trader
education  programs,   strategic   alliances,   target  marketing  and  software
licensing.  RFGI expects to use its status as a public  company and its stock as
publicly traded  "currency" to pursue strategic  acquisitions that would bolster
revenues  and cash  flow.  This  strategy  may be delayed  due to the  Company's
current stock price

     RushTrade is pursuing two primary channels of distribution for its products
and services. First, business-to-consumer,  by acquiring direct retail customers
through  its  broker/dealer  subsidiary,  RushTrade  Securities,  Inc.,  an NASD
broker/dealer  registered in all 50 states. RushTrade accounts are self-directed
and   customers   meet   strict    suitability    requirements.    And   second,
business-to-business  by licensing  versions of the RushTrade  software products
and by providing real-time financial data to other  broker/dealers and financial
institutions   through  its   technology   development   subsidiary,   RushGroup
Technologies, Inc.

     Strategic  relationships  with industry  partners  such as Knobias,  Online
Trading  Academy  and others are  designed to source and secure  online  trading
customers that have received training,  are the most active  participants in the
active  trader  market and are  expected  to generate  more  revenue per trader.


                                       17
<PAGE>
<TABLE>
<CAPTION>

Online Trading Academy is currently providing prime customers to RushTrade under
an earlier  announced  agreement.  RushTrade and Knobias are  currently  jointly
developing  a  "top-line  desk  top"  product  for  future   deployment  in  the
Institutional marketplace.

     RushTrade is executing a low cost "guerrilla" sales and marketing  strategy
in  addition to its  strategic  alliances  that is  producing  desired  results.
RushTrade's  domain  names,  www.daytrade.com,  and  www.rushtrade.com  have web
traffic that generate most of its current sales leads.  RushTrade  believes that
it can position  itself as a low cost leader in the retail direct access "space"
as it prepares to launch the co-branded  RushTrade  Direct  Pro/Knobias Desk Top
Product in the Institutional marketplace.

     Since  the  release  of the  RushTrade  products  in late  2002,  RushTrade
Securities,  Inc. has experienced  substantial month over month increases in new
accounts, shares traded volume and/or customer account assets.

     The number of RushTrade customer accounts and corresponding customer assets
have grown as follows:

        Total       As of      Securities      Cash          Total        Margin         Total
      Accounts      Date         Value        Balance        Assets        Debt          Equity
     --------------------------------------------------------------------------------------------
<S>  <C>         <C>          <C>           <C>           <C>           <C>           <C>
         95       9/30/2002   $ 1,492,474   $ 1,671,317   $ 3,163,790   $  (27,652)   $ 3,136,139
         140     12/31/2002     4,335,121     1,984,429     6,319,549     (318,152)     6,001,397
         190      1/31/2003     5,608,639     4,501,291    10,109,930     (829,355)     9,280,575
         225      2/28/2003    10,415,611     5,188,474    15,604,084   (1,426,446)    14,177,639
         301      3/31/2003    11,552,613     4,803,235    16,355,847   (1,169,472)    15,186,375
         421      4/30/2003    14,054,217     6,765,568    20,820,086   (1,468,478)    19,351,607
         522      5/31/2003    15,434,623     8,304,606    23,739,229   (1,799,998)    21,939,231
         636      6/30/2003    18,794,159     9,141,242    27,935,402   (2,598,923)    25,336,479
         751      7/31/2003    20,419,951     9,993,480    30,413,430   (2,701,092)    27,712,338
         856      8/31/2003    22,312,506    10,612,005    32,924,511   (3,148,393)    29,776,118
        1,001     9/30/2003    20,740,815    10,992,947    31,733,762   (2,075,382)    29,658,380
        1,116    10/31/2003    21,590,111    11,396,924    32,987,035   (1,261,640)    31,725,395

</TABLE>

     The  following  table shows the  activity  level for 2003 of the  RushTrade
Securities, Inc. customer base:

               For the         Number        Number         Number of
              Month of       of Trades      of Shares     New Accounts
             ----------     -----------   ------------   --------------
             January           3,414        3,596,532           50
             February          3,851        3,583,894           35
             March             4,521        3,039,325           76
             April             7,019        4,242,451          120
             May               8,178       10,029,062          101
             June             11,054        8,772,640          114
             July             10,839       11,632,790          115
             August           10,112       12,672,975          105
             September        13,315       32,177,054          145
             October          15,700       39,072,872          115

3.   Results of Continuing Operations


Three Months Ended September 30, 2003 and 2002


                                       18
<PAGE>

Revenues

     The following table sets forth the components of the Company's revenues for
the periods indicated:

                                       Three Months Ended September 30,
                                      ----------------------------------
                 Revenue                    2003               2002
        --------------------------    ---------------    ---------------
        Investment Services             $     366,928      $     421,376
        Software Services                           -                  -
        Corporate                                   -                  -
                                      ---------------    ---------------
                  Total                 $     366,928      $     421,376
                                      ===============    ===============

     Total revenue for the third quarter decreased $54,448, or 13%, from 2002 to
2003.  This  decrease  reflects  the  Company's  repositioning  as a  real  time
financial  technology  development and direct access online  financial  services
company from a traditional  financial  services holding company with traditional
insurance and broker/dealer services.

     In the third quarter, Investment Services revenue decreased $54,448 or 13%,
from 2002 to 2003.  The  decrease in revenue is  primarily  due to  management's
decision to reposition its retail securities  brokerage and insurance  marketing
resources  and efforts to  concentrate  on its RushTrade  direct access  on-line
trading system. Revenue from the RushTrade business unit increased $283,895 from
$42,587 in the third  quarter of 2002 to $326,482 in the third  quarter of 2003,
an increase of 667%.  Overall market conditions may have also contributed to the
overall decline in the Investment Services revenue.

     RushGroup   Technologies,   Inc.,   the  Company's   financial   technology
development subsidiary, plans to license versions of the RushTrade direct access
software and provide real-time  financial data services to other  broker/dealers
and financial  institutions  which is expected to become a significant stream of
revenue  for  the  Company  in  the  future.  There  is an  ongoing  development
initiative  on the  software  to modify and enhance  versions  of the  RushTrade
software for licensing to this market,  however the Company has not received any
revenue from this source.  The Company expects to be able to market the software
to outside entities in 2004.

Expenses

     The following table sets forth the components of the Company's expenses for
the periods indicated:

                                       Three Months Ended September 30,
                                      ----------------------------------
                 Expense                    2003               2002
        --------------------------    ---------------    ---------------
        Investment Services             $     415,418      $     448,204
        Software Services                     172,911            172,911
        Corporate                             270,699            199,412
                                      ---------------    ---------------
                  Total                 $     859,028      $     820,527
                                      ===============    ===============

     Total third quarter  expenses  increased  $38,501 or 5%, from 2002 to 2003.
Investment  Services  expenses  decreased 7%, or $32,786 and Corporate  expenses
increased 36%, or $71,287.  Software  Services  expenses are the amortization of
software development cost and have remained constant since July 2002.

     Investment Services expenses in the third quarter decreased $32,786, or 7%,
from 2002 to 2003.  This decrease is primarily due to a reduction in commissions
paid to  independent  sales  representatives  in 2002  offset by the  additional
marketing cost related to the Company's  repositioning  as a real time financial
technology development and direct access online financial services company.

     Software  Services  has ongoing  development  activity  on the  software to
enhance  its use and  ability to license  its  proprietary  products  to outside
entities;  however,  the Company has not  received any revenue from this source.
Expenses in Software  Services are the amortization of the capitalized  software
development costs. Amortization began in July 2002.

     Corporate  expenses in the third quarter  increased  $71,287,  or 36%, from
2002 to 2003.  The Company was able to reduce the  infrastructure  necessary  to
support the retail  brokerage  operations;  however,  this was offset to a great
extent from the new  marketing  efforts  supporting  RushTrade.  Supporting  the
retail  representatives  required  several  support  personnel.  As  the  retail
activity was lessened, the Company was able to release or redeploy the personnel
to  other   activities  along  with  other  assets  devoted  to  supporting  the
representatives.   This  resulted  in  some  expenses  that  were  allocated  to
Investment Services in 2002 being allocated to Corporate in 2003.

                                       19
<PAGE>

Net loss

The following  table sets forth the components of the Company's net loss for the
periods indicated:

                                       Three Months Ended September 30,
                                      ----------------------------------
            Net Income (Loss)               2003               2002
        --------------------------    ---------------    ---------------
        Investment Services*            $     230,401      $     (26,828)
        Software Services                    (172,911)          (172,911)
        Corporate                            (270,699)          (199,412)
                                      ---------------    ---------------
                  Total                 $    (213,209)     $    (399,151)
                                      ===============    ===============

*The net income from  investment  services for the three months ended  September
30, 2003 includes other income of $278,891  resulting from a gain on the sale of
certain assets and a gain on the settlement of liabilities of $53,891.

     Net losses in the third quarter  decreased  $185,942,  or 47%, from 2002 to
2003. The income from  Investment  Services  increased from a loss of $26,828 to
income of $230,401  from 2002 to 2003.  This is the result of a one-time gain of
$225,000 on the sale of certain assets to Brazos Holdings and a one-time gain of
$53,891 from the settlement of liabilities. Corporate operating losses increased
from $199,412 to $270,699. The loss from Software Services remained the same and
relates  entirely to amortization  expense of capitalized  software  development
costs. The increase in Corporate  operating loss is in part due to the reduction
in business  activity with the winding down of the former retail  securities and
insurance  brokerage  business  offset  somewhat  by the  higher  gross  margins
relating to the new  RushTrade  business  model which to some extent  offset the
Company's costs saving initiatives.

     The Company  recorded  earnings before  interest,  taxes,  depreciation and
amortization,  (EBITDA),  of $49,839 in the third  quarter 2003 versus a loss of
$172,437 in 2002.  Expenses  related to interest,  depreciation and amortization
amounted to $263,048 in the third quarter 2003 and $226,714 in the third quarter
of 2002. The EBITA of $49,839 reflects the Company's  repositioning,  the growth
in revenue from the RushTrade  business unit and the one-time gain from the sale
of assets to Brazos Holdings of $225,000 and a one-time gain from the settlement
of liabilities of $53,891.


Nine Months Ended September 30, 2002 and 2001

Revenues

     The following table sets forth the components of the Company's revenues for
the periods indicated:

                                        Nine Months Ended September 30,
                                      ----------------------------------
                Revenue                     2003               2002
        --------------------------    ---------------    ---------------
        Investment Services             $     805,115      $   3,678,124
        Software Services                           -                  -
        Corporate                              10,016                  -
                                      ---------------    ---------------
                  Total                 $     815,131      $   3,678,124
                                      ===============    ===============

     Total revenue for the first nine months decreased $2,862,993,  or 78%, from
2002 to 2003. This decrease reflects the Company's  repositioning as a real time
financial  technology  development and direct access online  financial  services
company  from  a  more  traditional  financial  services  holding  company  with
traditional insurance and broker/dealer services. The decline of its traditional
retail brokerage  business from the winding down of the former retail securities
and insurance  brokerage business and the June 2002 sale and transfer of certain
assets of Rushmore  Securities  Corporation to Empire Financial Holding company,
Inc. is a significant cause for the decrease in revenue.

     Investment  Services  revenue  decreased  $2,873,009,  or 78%, from 2002 to
2003.  The  decrease in revenue is  primarily  due to  management's  decision to
reposition its retail securities brokerage and insurance marketing resources and
efforts to concentrate on the continued  development and launch of its RushTrade
direct access on-line  trading system.  Overall market  conditions may have also
contributed to the overall decline in the Investment  Services revenue.  Revenue
from the new RushTrade  business unit  increased  $531,913,  from $65,395 in the
first  nine  months of 2002 to  $597,308  in the first nine  months of 2003,  an
increase of 813%.

                                       20
<PAGE>

     RushGroup   Technologies,   Inc.,   the  Company's   financial   technology
development subsidiary, plans to license versions of the RushTrade direct access
software and provide real-time  financial data services to other  broker/dealers
and financial  institutions  which is expected to become a significant stream of
revenue  for  the  Company  in  the  future.  There  is an  ongoing  development
initiative  on the  software  to modify and enhance  versions  of the  RushTrade
software for licensing to this market,  however the Company has not received any
revenue from this source.  The Company expects to be able to market the software
to other entities in 2004.

     Corporate  revenue increased from 2002 to 2003 primarily due to the sale of
the URL www.gro.com for $10,000. This was a one-time event.

Expenses

     The following table sets forth the components of the Company's expenses for
the periods indicated:

                                        Nine Months Ended September 30,
                                      ----------------------------------
                  Expense                   2003               2002
        --------------------------    ---------------    ---------------
        Investment Services             $   1,178,886      $   3,741,585
        Software Services                     524,566            172,911
        Corporate                             733,838          2,161,247
                                      ---------------    ---------------
                  Total                 $   2,437,290      $   6,075,743
                                      ===============    ===============

     Total expenses decreased  $3,638,453 or 60%, from 2002 to 2003.  Investment
Services expenses  decreased 68%, or $2,562,699 and Corporate expenses decreased
66%, or $1,427,409. Software Services expenses increased $351,655.

     Investment  Services expenses  decreased  $2,562,699,  or 68%, from 2002 to
2003.  This decrease is due to a reduction in  commissions  paid to  independent
sales  representatives  and reflects the Company's  repositioning as a real time
financial  technology  development and direct access online  financial  services
company  from  a  more  traditional  financial  services  holding  company  with
traditional insurance and broker/dealer services.  Additionally, the decrease in
Investment  Services  expenses is the result of a one-time write off of goodwill
of $1,042,028 during 2002.

     Software  Services  has ongoing  development  activity  on the  software to
enhance its use to outside  entities;  however the Company has not  received any
revenue  from  this  source.  In 2003 the  Company  had  amortization  for three
quarters  versus the  one-quarter  of  amortization  in 2002.  The Company began
amortization of the software development costs in July 2002.

     Corporate  expenses decreased  $1,427,409,  or 66%, from 2002 to 2003, with
the primary  reason  being the  reduction  of the  infrastructure  necessary  to
support the retail brokerage operations.  Supporting the retail  representatives
required  several support  personnel.  As the retail activity was lessened,  the
Company was able to release or redeploy the personnel to other  activities along
with other  assets  devoted to  supporting  the  representatives;  however, some
expenses  being  allocated  to  Investment  Services in 2002 were  allocated  to
Corporate in 2003.

Net loss

     The following table sets forth the components of the Company's net loss for
the periods indicated:

                                        Nine Months Ended September 30,
                                      ----------------------------------
                Net Loss                    2003               2002
        --------------------------    ---------------    ---------------
        Investment Services *           $     (94,880)     $     (63,461)
        Software Services                    (524,566)          (172,911)
        Corporate                            (723,822)        (2,161,247)
                                      ---------------    ---------------
                  Total                 $  (1,343,268)     $  (2,397,619)
                                      ===============    ===============

*The net loss from  investment  services for the nine months ended September 30,
2003  includes  other  income of $278,891  resulting  from a gain on the sale of
certain assets and a gain on the settlement of liabilities of $53,891.

                                       21
<PAGE>

     Net losses  decreased  $1,054,351 or 44%, from 2002 to 2003.  The loss from
Investment  Services increased from $63,461 to $94,880 or 49% from 2002 to 2003.
This in part is a reflection of the lower level of business  activity due to the
Company's repositioning. Corporate operating losses decreased from $2,161,247 to
$723,822.  The  decrease in Corporate  net loss is in part due to the  Company's
costs saving  initiatives and in part due to the reduction in business  activity
and the requirements of managing a smaller level of business activity.

     The loss before interest,  taxes,  depreciation and amortization  decreased
from  $2,030,305  in 2002 to  $596,570  in  2003.  This  reflects  the  improved
operating structure from the Company's repositioning.

Liquidity

     Cash Flows from Operating  Activities - The Company  incurred a net loss of
$1,343,268 for the nine months ended  September 30, 2003.  This amount  included
non-cash  expenses  totaling  $637,192.  Cash  flows from  operating  activities
increased by an decrease in receivables of $18,690 and by a decrease in prepaids
and deposits of $44,130 offset by a net increase in accounts payable and accrued
expenses of $268,656 due to the Company's lack of available  cash; thus yielding
a net cash flow used in operating activities of $653,491. The Company incurred a
net loss of $2,397,619 for the nine months ended September 30, 2002. This amount
included  non-cash  expenses  totaling  $1,581,246.  Cash flows  from  operating
activities  were  increased  by a decrease in  receivables  of  $325,354  and by
various  other  cash  flow  adjustments  aggregating  a net  source  of  cash of
$216,078;  thus  yielding  a net  cash  flow  used in  operating  activities  of
$274,941.

     Cash  Flows  From  Investing  Activities  - Cash  flow  used  in  investing
activities  during the nine months ended September 30, 2003 was $82,586 from the
capitalization  of  development  costs  related to the  RushTrade  direct access
software  RushTrade Back Office Tool.  This outflow was offset by the receipt of
$150,000 of proceeds from the sale of certain  assets.  The net cash provided by
investing  activities  for the first nine months of 2003 was $67,414.  Cash flow
used in investing activities during the nine months ended September 30, 2002 was
$393,594,  due to  capitalizing  $448,047 in  development  costs  related to the
RushTrade  direct  access  software  and  purchasing  various  fixed  assets for
$25,011.  This  outflow  was offset by the  receipt of $79,464  form the sale of
certain assets.

     Cash  Flows  from  Financing  Activities  - During  the nine  months  ended
September  30, 2003,  the Company  raised  $645,000  from the sale of 12% Senior
Secured  Convertible  Bonds and  received  net  advances  from  related  parties
totaling  $80,000.  These  increases were off set by repayments of notes payable
totaling  $16,099  and a decrease in the  Company's  bank  overdraft  of $37,750
during the first  quarter of 2003.  During the nine months ended  September  30,
2002,  the Company raised  $100,390 from the sale of common and preferred  stock
and  $400,000  from  borrowings.  The Company  paid $40,466 as payments on notes
payable and $38,184 as preferred stock dividends.

     The  Company's  cash  and cash  equivalents  at  September  30,  2003  were
$149,352,  and the Company's  liabilities  exceeded its cash and  receivables by
$3,412,872. The Company's requirements for normal cash expenditures,  as well as
costs for the further development of the proprietary on-line RushTrade software,
have  historically  been  supplemented with borrowings and equity capital raised
through the private placement of securities;  however, there can be no assurance
that these sources of cash will be available in the future.

     The accompanying  financial statements have been prepared assuming that the
Company will continue as a going concern. At September 30, 2003, the Company had
$3,650,350  in  liabilities,  and cash and  accounts  and other  receivables  of
$237,478.  Also, the Company  incurred net losses from continuing  operations of
$2,203,896 in 2001,  $3,131,636 in 2002, and $1,343,268 in the first nine months
of 2003. Although the Company believes that it will be able to continue to raise
the necessary funds until it reaches a sustainable level of profitability, these
matters raise  substantial  doubt about the  Company's  ability to continue as a
going  concern.  The financial  statements do not include any  adjustments  that
might result from the outcome of this uncertainty.

     The Company has taken  several  steps to increase  cash  through the use of
borrowings and equity.  Year to date, the Company raised $745,000  through a 12%
Senior Secured Convertible Bond offering and short term borrowings.  These bonds
bear  interest at 12% per annum,  principal  and  interest  are due on or before
December 31, 2007 and are  convertible  into shares of common stock at a rate of
50% of the average market price of the stock for the ten days preceding the date
of  conversion,  but not less  than  $0.15  per  share.  The  Company  may force
conversion if the stock trades above $2.00 per share for 10 consecutive  trading
days. The bonds are secured by the RushTrade  software,  trade names,  websites,

                                       22
<PAGE>

customer  accounts  and other  assets.  At  September  30,  2003 the Company has
outstanding  bonds with a principal  balance of  $1,173,748  and will attempt to
raise additional capital through the ongoing sale of the Bonds.

     The Company has outstanding  convertible notes payable totaling $485,000 at
September 30, 2003. Of this amount,  $300,000 bear interest at 9%, are due April
1, 2005,  and are  unsecured.  $185,000  of the  convertible  notes  payable are
currently due,  convertible  into the 12% Senior Secured  Convertible  Bond, and
bear interest at 7%. The holder of the convertible  note has submitted a request
that the  $185,000 be  converted  into RFGI Common  Stock.  This request will be
submitted to the Board of Directors for its review and consideration at the next
meeting.  The Company also has  outstanding  notes  payable of $36,301.  Of this
amount,  $18,675 is  currently  due and $17,626 is a capital  lease with a final
payment  in July 2004.  Additionally,  during  the first  quarter  of 2003,  the
Company was advanced  $100,000  from  related  parties.  These  advances are non
interest  bearing  and do not  have a stated  maturity  date.  Of the  $100,000,
$30,000  has been  repaid,  $15,000  has been  converted  into the  bonds  and a
subscription  agreement  has been  signed to convert  $35,000  into RFGI  Common
Stock.

     The  Company  anticipates  that  it will  need  approximately  $800,000  to
$1,000,000 to fund operations and repay maturing debt during the next 12 months.
Although no  assurances  can be made,  the Company  believes  that the continued
increase in revenue of the RushTrade business unit in conjunction with the sales
of the 12% Senior  Secured  Convertible  Bonds or other  private  placements  of
equity or debt  securities  will provide  sufficient  funds necessary to reach a
sustainable level of profitability.

     The Company conducted an extensive internal reorganization and reduction of
staff related to its  repositioning  and new business  development  activies and
implemented steps to closely monitor expenses. Additional marketing efforts have
been  implemented  to  increase  revenues  since the  release  of the  RushTrade
software products in late 2002. Pending the release of the RushTrade Back Office
Tool,  the  Company   expects  to  pursue   licensing   agreements   with  other
broker/dealers  and other financial  institutions which is expected to produce a
new revenue stream to further increase revenue.

     RushTrade's  marketing and sales efforts are currently  underway to acquire
new  active  trader/customer  accounts  that  will  generate   transaction-based
revenue.  RushTrade believes that it has the low cost operational infrastructure
and a relatively low threshold to reach profitability in the near future.  Since
December 2002 new sales  representatives  have been hired to generate additional
sales leads. Additionally,  the Company is using Internet advertising to provide
leads for the sales  representatives,  at an average cost of approximately  $100
per new  account.  The Company  believes  that it has  embarked on a  successful
marketing strategy to generate the necessary active trader/customer  accounts to
capture customer assets with the trade volumes and related revenues necessary to
reach a sustainable level of profitability.  There can be no assurances that the
steps taken by the Company  will result in the Company  being able to settle its
liabilities  as they  become due or that the  Company  will be able to  generate
revenues or cash flows from  financings  sufficient to support its operations in
the short term.

Forward-looking statements

        Certain  statements  contained in this 10-QSB  Report and other  written
material and oral statements made from time to time by us do not relate strictly
to historical or current facts.  As such,  they are considered  "forward-looking
statements"  that provide  current  expectations  or forecasts of future events.
Such statements are typically  characterized  by terminology  such as "believe,"
"anticipate,"   "should,"   "intend,"  "plan,"  "will,"  "expect,"   "estimate,"
"project,"  "strategy" and similar expressions.  Our forward-looking  statements
generally  relate to the  prospects  for future sales of our  products,  and the
success of our strategic  corporate  relationships.  These  statements are based
upon  assumptions  and  assessments  made  by our  management  in  light  of its
experience and its perception of historical trends, current conditions, expected
future developments and other factors our management believes to be appropriate.
These  forward-looking   statements  are  subject  to  a  number  of  risks  and
uncertainties,  including  the  following:  our  ability to  achieve  profitable
operations and to maintain  sufficient cash to operate our business and meet our
liquidity  requirements;  our ability to obtain financing, if required, on terms
acceptable  to us, if at all;  the  success  of our  research  and  development;
competitive   developments  affecting  our  current  products;  our  ability  to
successfully  attract  strategic  partners  and to market both new and  existing
products;  exposure  to  lawsuits  and  regulatory  proceedings;  our ability to
protect our intellectual  property;  governmental laws and regulations affecting
operations; our ability to identify and complete diversification  opportunities;
and  the  impact  of   acquisitions,   divestitures,   restructurings,   product
withdrawals  and other unusual  items.  A further list and  description of these
risks,  uncertainties  and other matters can be found  elsewhere in this 10-QSB.
Except as required by  applicable  law, the Company  undertakes no obligation to
update any forward-looking  statements,  whether as a result of new information,
future events or otherwise.


                                       23
<PAGE>

Use of non-GAAP financial measures

Financial  measures  included in this  Management's  Discussion  and Analysis of
Financial  condition and Results of Operations  that are not in accordance  with
generally  accepted  accounting  principles  (GAAP) are  referred to as non-GAAP
financial  measures.  While management  believes these measures contribute to an
understanding  of  the  Company's  financial  performance,  they  should  not be
considered in isolation or as a substitute for measures of performance  prepared
in  accordance  with  GAAP.  Management  uses and  presents  non-GAAP  financial
measures,  along with GAAP results,  to evaluate and communicate the performance
of the Company and its  segments.  Management  believes the  non-GAAP  financial
measures provide an additional analytic tool to understand the Company's results
from core operations and underlying  trends.  Management  believes that adjusted
earnings calculations are helpful in making period-to-period comparisons because
they  eliminate the effect of certain  accounting  changes,  as well as gains or
losses on certain transactions.
















                                       24
<PAGE>

Item 3.   Controls and Procedures

          (a)  As of September 30, 2003, we carried out an evaluation, under the
               supervision  and  with  the   participation  of  our  management,
               including  the  Chief  Executive   Officer  and  Chief  Financial
               Officer,  of the effectiveness of the design and operation of our
               disclosure controls and procedures pursuant to Rule 13a-15(e) and
               15d-15(e) of the  Securities  Exchange Act of 1934 (the "Exchange
               Act").  Based upon that evaluation,  the Chief Executive  Officer
               and  Chief  Financial   Officer  concluded  that  our  disclosure
               controls and procedures are effective in timely  alerting them to
               material  information  relating  to the  Company  (including  its
               consolidated   subsidiaries)  required  to  be  included  in  our
               Exchange Act filings.  Both the Chief Executive Officer and Chief
               Financial  Officer  are  directly  involved  with the  accounting
               process.

          (b)  The Chief Executive Officer and Chief Financial Officer concluded
               there have been no significant  changes in our internal  controls
               or in other factors,  which could  significantly  affect internal
               controls subsequent to the date we carried out our evaluation.











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<PAGE>

PART II.     OTHER INFORMATION

Item 1.  Legal Proceedings

      The Company and its  subsidiaries  are  engaged in legal  proceedings  and
arbitrations  from time to time.  Management  believes some of these proceedings
could have a material  effect upon the operations or financial  condition of the
Company if the Company is unsuccessful in defending against the actions. In some
cases the actions could affect the subsidiary,  Rushmore Securities, but not the
Company.

      On January 16, 2003, eight former securities account customers of Rushmore
Securities  filed a  complaint  against the  Company  contending  that they made
numerous  investments in securities that a former account  representative of the
Company  sold  outside  and away from his  representation  of the  Company.  The
claimants allege the investments were  fraudulent,  speculative,  and unsuitable
and that the  Company  failed to  properly  supervise  the  representative.  The
claimants  contend they  invested  $808,000 in these  securities  and the entire
amount was lost through such  investments.  The Company denies the  allegations,
contends they are barred by the applicable  statutes of limitations  and intends
to vigorously pursue its defense.  Currently,  the Company is unable to estimate
the ultimate liability, if any, related to this complaint.  However, should this
complaint  be settled in favor of the former  customers,  any  liability  to the
Company would have an adverse effect on the Company's financial condition.

      In June 2002, a former securities account customer of Rushmore  Securities
filed for NASD  arbitration  against her former account  representative  and her
successor  brokerage firm. She has improperly named Rushmore  Financial Group as
respondent.  The account representative settled this issue with the claimant for
$11,000 on April 30,2003. The Company issued the account representative a $3,000
bond as an inducement to settle.

      In April 2003, a group of former securities representatives filed for NASD
Dispute  Resolution naming the Company,  Rushmore  Securities and Mr. Moore. The
former representatives are claiming $178,288 in commissions.  A date or location
for the hearing has not been set.  The Company has  unsuccessfully  attempted to
negotiate a settlement with the representatives and intends to vigorously defend
the claim.  The Company has  estimated  the ultimate  liability  related to this
claim to be  approximately  $43,000 and  accordingly has recorded an accrual for
this  amount  in  the  financial  statements.  This  issue  is  pending  with  a
preliminary hearing to take place on April 6, 2004.

      An employee  consultant agency filed a claim in the Dallas County Court at
Law, on December 17, 2002 claiming  that the Company  failed to pay for services
rendered in placing  temporary  workers in the amount of  $41,630.  The suit was
settled on July 24, 2003 for $15,000 and 5,000  shares of the  Company's  common
stock valued at $1,450.

      In May 2003, a former securities  account customer of Rushmore  Securities
filed for NASD  arbitration  against their former  account  representative,  the
account representative's account manager, their local office and their successor
brokerage  claiming  the  investments  were  unsuitable  and  speculative  their
accounts  decreased  in value by  $125,000.  A response was made On May 28, 2003
with a preliminary hearing scheduled for April 12, 2004. Currently,  the Company
is unable to estimate the ultimate liability, if any, related to this complaint.

     In May 2003, a former  securities  account customer of Rushmore  Securities
filed for NASD arbitration  against her former account  representative and their
successor   brokerage  firm  claiming   their   investments   were   unsuitable,
speculative, negligent, gross negligent and with negligent supervision and their
accounts  decreased in value by between $100,000 and $500,000.  On June 23, 2003
the Company  filed a response and is waiting for the notice for the  preliminary
hearing. Currently, the Company is unable to estimate the ultimate liability, if
any, related to this complaint.

      On June 30, 2003, a former vendor filed a claim in the Dallas County Court
claiming that the Company failed to pay for services rendered on their copier in
the amount of  $39,710.  The  Company has filed a counter  claim  alleging  over
charges and the improper  installation of a software  product caused the Company
incalculable harm. A non-jury trial is set for January 14, 2004. Currently,  the
Company is unable to estimate the ultimate  liability,  if any,  related to this
complaint.

      On August 5, 2003, a financial daily business publication filed a claim in
the Dallas  County  Court at Law  claiming  that the  Company  failed to pay for
advertising in their  publication in the amount of $4,513. On August 29, 2003, a
response  was filed with the court.  A successful  settlement  is being made for
payment. This item is pending settlement for approximately $6,200.

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<PAGE>

      On November  10, 2003, a former  securities  account  customer of Rushmore
Securities   filed  for  NASD   arbitration   against   their   former   account
representative,   and  their  successor  brokerage  firm  claiming  his  account
decreased in value by $150,000 due to fraud, negligence, and breach of fiduciary
duty.  The Company  must file a response by December 26,  2003.  Currently,  the
Company is unable to estimate the ultimate  liability,  if any,  related to this
complaint.

      On November 12, 2003, a former  vendor filed a claim in the Dallas  County
Court that the Company failed to pay for services rendered on the publication of
Company  documents in the amount of $11,865.  The Company has fully  accrued the
amount of this  liability  and will attempt to  negotiate a settlement  with the
vendor.

Item 2.  Changes in securities and use of proceeds

Recent Sales of Unregistered Securities

     During the second quarter the Company issued 146,250 shares of common stock
to employees as additional compensation.

     During the current  quarter the Company issued 7,000 shares of common stock
to vendors to satisfy claims.

Item 6.  Exhibits and Reports on Form 8-K

     a.   Exhibits.

Exhibit 31.1 Certification of Chief Executive Officer Pursuant to Rule 13a-14(a)
or Rule 15d-14(a).

Exhibit 31.2 Certification of Chief Financial Officer Pursuant to Rule 13a-14(a)
or Rule 15d-14(a).

Exhibit 32.1 Certification of Chief Executive Officer Pursuant to Rule 13a-14(b)
or Rule 15d-14(b) and 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906
of the Sarbanes-Oxley Act of 2002.

Exhibit 32.2 Certification of Chief Financial Officer Pursuant to Rule 13a-14(b)
or Rule 15d-14(b) and 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906
of the Sarbanes-Oxley Act of 2002.

     b.   Reports on Form 8-K.

     None


                                    SIGNATURE

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

                                    Rushmore Financial Group, Inc.

Dated: November 14, 2003            By /s/ Dewey M. Moore, Jr.
                                    -------------------------------
                                    Dewey M. Moore, Jr.
                                    Chief Executive Officer

Dated: November 14, 2003            By /s/ Randy Rutledge
                                    -------------------------------
                                    Randy Rutledge
                                    Chief Financial Officer



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